Ryanair: SWOT and PESTLE Analysis

Context of Business

Contents
INTRODUCTION OF CASE STUDY............................................................................................1
SWOT ANALYSIS.........................................................................................................................1
PESTLE ANALYSIS......................................................................................................................3
IDENTIFIED ISSUES THROUGH ABOVE ANALYSIS.............................................................5
RECOMMENDATIONS.................................................................................................................6
REFLECTION.................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION OF CASE STUDY
Every organisation operate in a flexible and dynamic business environment in which
various forces affect its operations and decision making process. Determine those elements and
study the same is very essential for every business enterprise in order to offer better services to
its customers and to get competitive advantage. Ryanair, which is a Irish airline having
headquarters in Swords is consider in this report for study. various problems which company is
facing and different theories that can be use b y company to deal with those issues is all included
in this report.
SWOT ANALYSIS
Ryanair- SWOT analysis
SWOT analysis refers to the thorough study of the organisation’s structure, success criteria,
stakeholders and the industry environment to acknowledge the organisation’s strengths,
weaknesses, opportunities and threats.The purpose behind the SWOT analysis is to determine the
major influencing factors that are affecting the development of Ryanair internally as well as
externally. The analyzed factors are to be utilized to forming further strategies and also to make
any necessary changes required in the existing strategies (Aarup, 2017).
Internal factors
Strengths
Management Ryanair is being led by some of the most influential managers, including
its CEO Michael O’Leary who is known to be very outspoken. He believes that a good
leadership approach must include backing of all the sectors together to improve cooperation and
gain maximum results. Ryanair has an organisation structure with a short hierarchy, this
closeness helps the company to maintain effective communication both inter and intra sectors.
Low cost fare Ryanair presents itself as an airline that offers the lowest fares giving them
an incredible competitive advantage. The intention behind placing the airline into this category is
to attract customers with limited spending potential. This unique selling proposition helped
Ryanair to become the most desirable name in the middle-class psychographic segment of target
audience. Another competitive advantage Ryanair possess under the same strength is the service
that offers a one-way pricing policy, unlike any other competitor airline.
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Choice of secondary airports In the hue of avoiding congested airports with inconvenient
turn-around time, Ryanair focuses on the secondary and regional airports. The chosen secondary
airports help reduce airport charges. The passengers spend comparatively less time for checking
in and at the gates than they had to spend at the major airports (Zhu, And Zolkiewski, 2016).
Low cost of operation Ryanair manages to maintain the lowest operating cost in the
short haul airline sector in Europe. More than an advantage it is necessary for Ryanair to
minimize the operation cost in order to provide the lowest fares. Ryanair keeps a tight watch on
the cost of its labour, the fuel, cost of airport, unnecessary expenditure on excessive
maintenance, etc. The high number of passengers also helps balance the cost of operation.
Finances Ryanair is one of the most financially stable airlines in Europe. The company is
known to be generating the highest revenue in the airline sector of Europe. Apart from the period
of fuel prices hike in 2008-09 Ryanair never failed to cover the cost of its capital.
Weaknesses
Low employee satisfaction The employees at Ryanair have claimed to be treated with
disrespect. The staff also states concerns about how they the demands and requests are neglected.
This puts Ryanair in a bad light as opposed to its competitors like Southwest who are branding
themselves as an airline that cares about everybody. The airline refuses to accept union forms
amongst the employees. There have been complaints from the staff such as their inability to
charge the mobile phones on air. The pushing of unfair agreements has also been brought
forward (Rong, and et. al., 2015).
Inconsistent earnings Ryanair earns most of the earnings over the period of summer.
The revenue earned in the rest of the year contributes as a very little portion in the annual
revenue of Ryanair. Since 2008-2009, a consistent trend of losses can be seen during the winters.
The management at Ryanair proposed to resolve this issue by grounding 80 carriers during the
month of winters, thus saving the extra operation and maintenance cost.
Disappointing brand perception Despite of its strong standing unique selling
proposition, Ryanair fails to manage its perception in the eyes of its audience and other stake
holders. According to the surveys and the feedback, Ryanair is perceived to be an inconsiderate,
mean and a rip off brand of airline. This negative publicity has direct and adverse on the
Ryanair’s sales (Zhu, and Zolkiewski, 2015).
External Factors
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