Context of Business: Internal and External Factors of Ryanair Airlines

This report analyzes the internal and external factors of Ryanair Airlines, including strengths, weaknesses, opportunities, and threats. It also discusses the impact of Brexit on the company and suggests strategies for improvement. The report recommends implementing the Scientific Management Theory to enhance operational processes and employee performance.

Context of Business

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
TASK 2............................................................................................................................................6
TASK 3............................................................................................................................................7
TASK 4..........................................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
The context of business can be understood by the explanation of various factors which
enables companies to construct long term goodwill and strong profitability ratios for reaching
high expansion scales. Ryanair airlines is one of the oldest Irish airlines operating its operations
all over Europe, having large customer base and strong aviation services which has enabled the
company to reach high end benchmarks. The report explains internal and external business
environment factors, scenarios on which company can enhance its position among other business
world brands. The report has significantly highlighted various business segments which are weak
and not efficient in delivering services. It explains innovative business models, formulation of
business expansion with which they can raise productivity cycles and brainstorm new ways of
training and developing employees.
TASK 1
The internal factors of Ryanair airlines which constitute the fundamental force of
company capabilities and potentialities for gaining strong position in market place industry can
be analysed by SWOT analysis (Büyüközkan and Ilıcak, 2019).
 Strengths: Ryanair Company has long legacy of goodwill among customers which is high
strength factor for company in occupying strong place among aviation industry. There is also
large capital funds before internal management which gives company strong investment
avenues in machinery and technology within aircrafts, promote and expand its business
operations into untapped countries market share.
 Weaknesses: Ryanair is facing tough competition of new airlines companies, brand emergence
with innovative technology factors and high raw cost which gives profound competitive
environment to company. Preferences of customers are changing dynamically which is giving
tough factors of potential energy which the company in present operations is majorly lacking.
Ryanair airline has faced decline in revenue margins and low productive services due to these
weaknesses, where it has been unable to strike high position among global aviation industry.
 Opportunities: Ryanair does have the opportunity to leverage huge potentialities of occupying
firm place within customers by delivering high quality services and leveraging strong

technology with advanced machinery in aircrafts. These opportunities are the most lucrative
factors to gain strong position in the industry and compete with strong determinants, to gain
long term goodwill and strong profitability. Opportunities can be leveraged with strong internal
company structure where the management is largely efficient; research breakthrough needs to
be induced within frameworks to bring large profitable revenues and goodwill factors.
 Threats: Ryanair airlines have threat of huge competitive forces which are highly innovative in
technology standards, creative working handles and strong promotional avenues which enable
to get strong place among customers. Ryanair has been facing huge competition from the world
aviation industry with emergence of new companies; airlines industry is downgrading the
rational viability among consumers (Namin, Askari and Ebrahimi, 2019).
Swot analysis explains the various paradigms of internal management within Ryanair
Company where it is certainly weak, the points it has to restructure and fragment its forces to
gain high ends of large customers market share. There are various parameters of strengths with
high capital funds and long term goodwill, other weakness and threat can be minimised with use
of potential opportunities for growth. Productivity can be developed only when external
competitive environment is also considered while establishing long term strategies and
decisions for expansion into untapped countries market share.
External environment (Pestle analysis)
External business environment can be analysed on the parameters of functional innovation,
creativity within company services and the various funnels which are external to company but with
high long term implications. Pestle analysis is one of the most effective business model which
explains the various scenarios in detail, Ryanair company needs to stand on these points to reach high
scale business platforms and enhanced business services to customers around the world.
 Political factors: Brexit decision has largely affected Ryanair airlines company operations on
various parameters which can be analysed by the fact that there has been high constraints built
within UK and European Union. The increased taxes and changes in prices are high on both
countries which significantly impacts company operations and expansion decisions.
 Economic factors: The imbalanced economic situation in country can be analyzed by the
changing disposable incomes within people where they affect their decisions to choose airlines
for their travels. Ryanair has been largely affected with high preferences of quality standards

with low margin on profitability factors impacts on business (Achinas, Achinas, and Euverink,
2019).
 Social factors: The evolving customer’s preferences are an important social factor of change
within various parameters which impacts Ryanair company operations largely. Social factors
are highly important for company to focus on, as long term goodwill and high profitable
revenues can be achieved by gaining strong customer base demands . The changing preferences
of social changes in customers preferences, diversity implies the various factor of growth, long
term research implications which deter mine further growth and high quality integration of
various services.
 Technological factors: The high innovation within technology sectors of companies in aviation
industry are coming up with new advanced technology frameworks, by new modernised
systems coming up Ryanair is facing huge competition from external factors. Macro
environment technology integration highly impacts company present production standards. New
modernised technology imposes huge risk of innovation, high investment of capital funds which
Ryanair has to focus on for gaining strong place in expansion.
 Legal factors: The wide changes and legal compliance factors due to high political unstable
environment and changing demographics decisions impacts Ryanair company operations. Legal
factors within macro environment are not only highly important for establishing long term
goodwill, and the synergy with which they gain strong place and position among customers
around world (Stevenson and Marintseva, 2019).
 Environment factors: The changing environment factors, climate change impacts company
outputs, services on various grounds which can be understood by the fact that there is high
focus on these for expansion into new untapped countries market. These factors of macro
environment in dynamic business world highly relate to various changes which Ryanair has to
determine while establishing their business strategies.
The external factors of macro environment in which Ryanair operates it business is
highly competitive, vast and rapidly evolving under various forces which imply the change of
various factors. There is lack of innovation and creativity with quality standards which impact
their business revenues, growth scenarios and the research ability needs to be built for gaining
optimistic growth with productivity.

TASK 2
There are a lot of problems which Ryanair airlines are facing because of the Brexit and
they have to be solved fast so that the company can maintain their reputation in the market. The
company has to increase the costing of the services and products they are giving to the customers
because there is an increase in the trading taxes which is making a great impact on the
organization which has to be controlled on time. The organization will have to come up with
other ideas and strategies to use in the market so that they can have a better functioning for
themselves which is going to be very helpful for the company. The company will have to reduce
on the services and the raw material they are getting so that the company can reduce their prices
for the customers (Akgüç, Beblavý and Simonelli, 2018). Customers are not very satisfied with
the organization because of the prices, which is leaving the company with two options which are
reducing the raw material and services or improving the services and satisfaction level of the
customers from time to time. But the organization can not improve the services because the other
issue the business is having is that they are being unable to get employment in the organization
which is making it very difficult for the organization to function effectively in the market. It is
because of the negative impact on the customers and there is no improvement in the services but
the price increase has made a negative coverage of the organization which is making the
company have a very negative impact.
After Brexit the employees have left the organization because the wages reduced and the
customer shares in the business as well. When the employees do not get what they need or are
not motivated from time to time they tend to leave the organization which Ryanair is facing. The
employees of the company have to be ensured that the situation of the organization will get better
in the market but they are not being able to do that because they did not focus on the employees
but the operations inside the organization. The focus was on the prices and the taxes which
increased therefore it is very important for the company to have a better workforce which is
motivated and have new ideas for the airlines so that they can improve and increase the profit
margins again. It is because of the negative coverage the organization is not being able to
promote them more and attract the right employees as well in the company which is a very
important factor in the organization. Ryanair has lost on a lot of loyal customers in the
organization because of the decisions they have made after Brexit which is why it is very

important for the organization to have a positive influence on the customers by the media
(Akgüç,Beblavý and Simonelli, 2018). The media of the country will have to be shown the right
measures and taken into confidence that the organization has made effective decisions for them
to work in and the company is doing everything for the customers.
Ryanair will also have to focus on the employees in the organization so that they can
have a loyal set of workforce which is supporting the organization to operate in the market.
Ryanair has created a great image of them in the market which is a very important factor for the
company which is why it is very important that they maintain their standards for the customers
with the help of the employees which are there in the company. Employees are the backbone of
the organization which is why this requires immediate attention of the company and improve that
factor so that the operations of the organization is smooth which will create a better impact on
the customers. Ryanair has been very particular about making decisions in the organization so
that there is a better brand image of the organization in the market. Internal and external factors
were analysed but because of Brexit there were a lot of problems which the company has faced
as discussed above which the company has to make decisions for (Caputo, Borbély and Dabic,
2019). The company will have to get back their reputation in the market and the market share
which they have lost over time has to be recovered.
TASK 3
As Ryanair faces many problems all of which stem from a need to better manage its
operational processes and employees, Ryanair is recommended to implement and incorporate the
Scientific Management Theory of management which was created by Fredrick Taylor. This
management theory will aid Ryanair’s management operations to enhance the performance,
efficiency and productivity of its employees and workforce so that Ryanair’s operational
productivity and profitability can be increased in the consumer markets. This would also provide
Ryanair with a competitive advantage against its industry rivals in the markets. Scientific
Management Theory is a management theory which focuses on analysing and synthesizing the
workflows of employees within a business organisation such as Ryanair. Its primary objectives
for implementation are to improve the effectiveness and efficiency with which an employee
performs his duties and responsibilities (Su, 2017). Successful implementation of Scientific

Management Theory to Ryanair’s operations and functions will effective allow it to make
efficient use of time restrictions, lower their production and operational costs, retain larger
number of employees in the industry, increase performance and efficiency of their workforce and
create or maintain productive relationship between Ryanair’s management and its entire
workforce.
Scientific Management Theory is particularly beneficial to Ryanair’s operations because
of the key features that Scientific Management Theory provides to Ryanair. These key features
are as follows:
 Universality: The theory can be applied to enhance the productivity and profitability of
any business organisation or to all levels of the business’s management and
administration.
 Flexibility: The Scientific Management Theory is highly flexible in its application and
makes use of non-static rules, dynamic guidelines and managerial discretion.
 Focus on Behaviour: The Scientific Management Theory tries to deal with the complex
behaviours of Ryanair’s managers and employees with the intention to provide Ryanair
with increased productivity, efficiency and profitability in the consumer markets.
 Equal Responsibility: The theory mandates that all operational responsibility is divided
equally amongst Ryanair’s management and employees so that a productive relationship
between management and workforce can be created.
In order to incorporate the Scientific Management Theory into its operations and
functions, Ryanair needs to integrate the following key principles of Scientific Management
Theory into all functions performed by its workforce and management. The key principles that
Ryanair needs to integrate into its operations are as follows:
 Scientific Management: One of the key principles of Scientific Management Theory
which Ryanair needs to incorporate into its management’s operations is the use of
scientific investigation approach for all the decision-making operations conducted by its
management, as opposed to the traditional ‘rule of thumb’ approach. Ryanair’s
management is required to base all their decisions on the application of scientific
approach to the objectives of the decision making.

 Scientific Recruitment: Another key principle of Scientific Management Theory that
Ryanair’s Human Resource Management department needs to adopt is the scientific
approach to recruiting and selecting all future employees of the organisation. This will
ensure that Ryanair procures select talented and skilled employees who are able to further
improve the productivity and profitability of Ryanair by performing with increased
efficiency and effectiveness. Ryanair’s management and HRM are also recommended to
make use of scientific approach of training and development of their employees to avoid
lapses in performance and increased efficiency of the workforce.
 Cooperating Management and Workforce: Ryanair needs to implement this principle of
Scientific Management Theory into the operations, functions of their management and
workforce in order to create a healthy productive relationship between its management
and workforce. This principle entails that Ryanair needs to change its operational culture
so that there is increased cooperation between the functions and operations of its
management and workforce. On effective implementation this will also result in
increased productivity and profitability for Ryanair in the consumer markets.
 Optimum Outputs: This principle of Scientific Management Theory states that Ryanair
needs to align the objectives and goals of its management, workforce with the intention to
achieving maximum outputs for the organisation (Chen and Hitt, 2019). Only when
Ryanair implements optimum outputs as a key principle in its operations and business
strategy, can it observe any positive change to its productivity and profitability in the
consumer markets.
 Shared Responsibility: To effectively implement Scientific Management Theory into its
operations, leadership of Ryanair needs to delegate the operational responsibilities
equally amongst its workforce and management. Ryanair’s management needs to take
responsibility of lapses in workforce performance and vice versa to implement necessary
changes that can increase the productivity and profitability of Ryanair.
As Ryanair is also experiencing high turnover rates and low employee motivation and job
satisfaction levels, it is recommended to incorporate the Herzberg’s Two Factor theory of
motivation into its operations. Herzberg’s Two Factor theory is a content management theory of
motivation, which states that there exist various factors in the business environment of Ryanair,
which can have immense impact on the performance, efficiency, motivation and job satisfaction

levels of its employees and workforce. According to the Herzberg’s Two Factor theory of
motivation, there exists motivating factors in Ryanair’s business environment and hygiene
factors too, both of which are immensely influential to Ryanair’s efforts to increase its
employee’s motivation and job satisfaction levels. Ryanair’s management and leadership needs
to ensure various motivating factors are present in its operational culture such as jobs that
provide employees with a sense of achievement on completion of the task, recognition from
management and superiors for good performing employees, future potential for employee growth
and development in Ryanair’s structure through promotions, autonomy to accomplish delegated
tasks to the employee etc (Alshmemri, Shahwan-Akl and Maude, 2017). Ryanair’s management
also needs to ensure presence of hygienic factors in its operational culture such as fair and equal
organisational policies and rules, safe and healthy working conditions, unbiased payment
structure to all employees, corruption free working environment etc. Only when both hygienic
and motivational factors are present within the operational culture of Ryanair, can it effectively
implement Herzberg’s Two Factor theory of motivation into its operations with the intention to
increase the motivation and job satisfaction levels of its employees and be able to retain them.
TASK 4
It is very important for the team to work as one so that the report can be completed on
time and also for the result to be effective. There has to be a satisfaction of all the members of
the group in the report so that when presented the group is satisfied which will get a satisfaction
of the readers as well. There has to be a good understanding of the group and there are conflicts
which can rise while working in a group but they have to be solved and new ideas can generate
from that which is the observation of all the members. There are a lot of time management and
distribution of work which is required so that the work can be done by those members which will
be able to cover that field. The work was given to members according to their skills and
capabilities so that the result of the report is satisfactory. There was a little experience in the
group to work as one which is why the report is not completed as expected but because the time
period left in hand was little we put in our best. We did not know that there was a requirement of
a leader in completing a report as well but we did end up having a leader by the end of the report
so that there was monitoring and updating all the members of the group of the work which was

left and completed. A lot of decisions had to be made so that the report could be completed on
time and effectively (Direction, 2019).
CONCLUSION
Based on this report, it can be concluded that the internal and external factors present
within the business environment in which Ryanair operates in influence its productivity and
profitability considerably. This report also evaluates the main problems that Ryanair currently
faces and recommends solutions to these problems by using Scientific Management Theory and
Herzberg’s Two Factor Theory of motivation.

REFERENCES
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