Contemporary Developments in Business and Management Assessment

This report explores the contemporary developments in business and management assessment, focusing on external factors that affect companies and the relevance of customer relationship management (CRM) on Ryanair airlines. It discusses the importance of understanding political, economic, social, technological, legal, and environmental factors, as well as the application of Porter's Five Forces Model. The report also evaluates the effectiveness of Ryanair's CRM approach and suggests areas of improvement.

Contemporary
Developments in
Business and
management
Assessment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1 ...........................................................................................................................................3
External Factors that affect companies & its importance..........................................................3
Porters Five forces Model...........................................................................................................5
TASK 2 ...........................................................................................................................................6
2.1 Relevance of CRM on Ryanair airlines...............................................................................6
2.2Evaluation of effectiveness of organization's response.........................................................8
2.3Areas of improvement in response to Ryanair......................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
BOOKS & Journals...................................................................................................................11

INTRODUCTION
Nowadays, Management skills is not enough to survive in the market or to gain success.
There is a need to adopt contemporary practice in the organisation so that managers gain
knowledge about how to integrate and implement the activities of organisation effectively.
Businesses are growing and expand its operations at global level. Therefore, contemporary
business practices assist managers in gaining knowledge about the culture of other countries so
that they can achieve competitive edge at marketplace(Alvarez, 2016). In this current report,
Ryanair is chosen as a base organisation. Ryanair is an airline services and its subsidiaries are
Malta air, Lauda, Ryanair UK. The company was founded in year 1984 by Michael O'Leary. Its
head office is in Dublin, Ireland. This report covers the external factors that effect organisational
effectiveness and performance. With this, their importance is described in the report. Later, it
covers customer relationship management and its affect on the policies of the organisation. At
last, it suggest some methods to improve the performance of the company.
TASK 1
External Factors that affect companies & its importance
External factors effect the ability of businesses that directly impact organisational goals
and objectives. Ryanair, an airline company which headquarter in Ireland founded by Michael
O'Leary. The manager of the company wants to know the external factors that affect their
business. For this, they use PESTEL analysis framework which is described in detail below:
PESTEL analysis
This method considers the political, economic, social, technological, legal and
environmental factors. PESTLE analysis of Ryanair airlines are as follows:
Political factors:
Those factors in which the government interferences takes place while formulating
policies. It includes elements such as political stability, trade tariffs, tax policy and many more.
In context to Ryanair airlines, the company main earning is from UK and maintains large market
share and customer base in united kingdom(Anastase and Grigoruț, 2016). Entry of Brexit in UK

economy negatively affects the business of Ryanair and declines the level of profitability. In
addition to this, the stability of UK government is good that helps Ryanair in expanding its
business easily which further leads to gain more market share and profitability.
Economic factors:
It consist of exchange rate, currency rate, interest rates and so on. These factors plays an
important role in survival and success of company in the market. With reference to Ryanair
airlines, recession in UK adversely affect the earning potential of airlines in United Kingdom.
The financial crisis declined the development as well as growth of Ryanair airlines in EU
countries. In addition to this, increase in the price of fuel force company to increase the booking
fare which directly decline the demand of airline industry. With this, the profitability and sales is
also declined.
Social factors:
It includes components such as beliefs, norms, culture, traditions, values, opinions and so
on of all the people who is living in the country. In context to Ryanair airlines, the low cost
strategy increases the level of middle class people and they prefer to go for more trips. The
airline has a strong market base and operate around 320 routes. The upper level authorities
should always considers that the preference and needs of its customers, workforce,stakeholders
fulfil. With this, they engage its customers as well as employees for longer time(Axelsson,
2018).
Technological factors:
Most of the population prefer those services which is highly advanced and innovative. In
today's world, technology is changing rapidly and in order to being competitive companies adopt
these technologies. With reference to Ryanair airlines, the manager uses digital communication
medium to reach to target audiences. Moreover, it provides an opportunity to understand the
customer behaviour by identifying customer's data which is provided on online platforms. In
addition to this, adopting new technologies attracts more customers and assist in maintaining
quality of services that Ryanair provides to its customer's.
Environmental factors:
It involves those elements that affect the environment such as weather, environmental
offsets, climate, global changes and many more. Nowadays, people are more concerned to live in
a healthy and environmental friendly environment. With reference to Ryanair lines, the company

using an innovative aircraft fleet in which the consumption of fuel is less. As per the company
CSR report, the company follow all the laws and legislations of safety environment(Barrett,
2016) .
Legal factors:
It includes those legislations which is required to follow by every organisation in order to
maintain legality in the company. Exit of UK from EU completely changes the laws of the
country which affect the legislations of airlines. with this, the burden on the company increases
which automatically declined its efficiency level. Restrictions between EU & UK decline the
demand of business and the level of sales. In addition to this, due to increase in financial burden
the company reduces the pay scale of workforce which directly leads to reduce productivity of
employees.
Porters Five forces Model
Threat of new entrants: In order to enter in this industry, it needs high amount of money
as well as time. Ryanair is renowned company in terms of its services and low-fares since 1985.
The threat of entry in this type of industry is weak. Because it requires high maintenance cost,
high development cost, survival cost , high investments and many more(Boyer, 2014). Ryanair
has strong marketing position and the managers of company highly promoted its services on
websites, newspaper, social media and so on. Therefore, it is difficult for companies to enter and
gain competitive advantage in airline industry.
Competitive Rivalry: The competition is high in airline industry. Competitors such as
Easy Jet is the biggest competitor of the company and this decline its sales sometimes. The low-
fare policy of the company attracts more customers and increases its sales. Ryanair airlines also
focuses in developing marketing strategies that assist them in making high market position and
gain competitive edge at marketplace.
Threat of Substitute: Many customers choose the mode of transportation as per their
budget and price. Low budget customers prefer buses and trains as compare to airlines. The
customers also prefer those airlines which gives them services in low amount and save their time.
So it is wholly depend on the customers that threat of substitute is high or low. As now, company
focuses more on building loyal customers and engaging them for longer time(Brewster, 2019).
Bargaining power of suppliers: The power of suppliers in airline industry is high as they
have limited number of labours and furl suppliers. In context to Ryanair, the company have a

contact with Boeing who supply spare parts, products, technical support to Ryanair. The manager
of the company maintains a good relationship with the suppliers so that they give services on
time which will further help company in matching with the demand.
Bargaining power of Buyers: In today's world, customers are totally aware about the
prices or about the competitors of the company with whom they are taking services. This force
companies to low down their [prices and give high quality of services in order to retain
customers(Brocke and Rosemann, 2014). With reference to Ryanair, the company tries to week
the power of customers by offering them best services as well as quality. Therefore, customers
did not switch to other airlines.
TASK 2
Customer relationship management is a method that help companies in maintaining
strong relations with the current customers as well as with the potential customers. It also assist
organisation in retaining and engaging them for longer period. The companies uses various
communication medium in order to make good connections such as telephone, websites, live
chat, social media, email and many more. By the help of this method, the managers learn about
the needs and requirements of their customers and gain more knowledge about target and
potential audiences. Companies uses CRM software in order to collect and maintain data about
its customer's and reach current and potential users. Also, they analyse the data to improve their
services and goods as per the specification of their customers(Cui and Li, 2017).
2.1 Relevance of CRM on Ryanair airlines
Ryanair, the company uses customer relationship management approach in order to make
good relations with its customers and gain customer loyalty. They provide high quality service to
customers so that customers can gain good experience from its services and remain loyal with
Ryanair. The implementation and execution of CRM approach increases the profitability of the
company. With this, the company develop services that gives the advantage to both customers as
well as organisation. The upper level authorities of the company found it relevant as it assist in
engaging customers, employees, stakeholders and society also.
Customers: In airline industry, it is important for the company to give best customer
experience. As the survival of companies is depend on the customer's. In context to Ryanair, the
company offers personalized services to its customer's so that they enjoy and feel comfortable in

using their services (Gamble, Peteraf and Thompson, 2014). The management team of the
company takes feedback from the customers so that they can improve its services which further
leads to profitability. They send Thanking mail to customers in order to make them feel special
and valued. For instance, A woman cancel and claimed company to refund its amount due to her
mother passed away, the company refund the amount with in an hour with soft & kind words. It
shows that Ryanair cares about its customers issue and puts efforts in maintaining good relations
with the customers. In addition to this,they understand the conditions as well as situations of
customers . Moreover, the company have team who provide 24 hours online service to its
customers and solve their problems & issues. It assist company in fulfilling the demand of
customers on time so that they can use their services only and remain loyal with them(Hagmann,
Semeijn and Vellenga, 2015) .
Sometimes customers get frustrated when the problem arise at the time of payment. They
suddenly change their decision and prefer other flights. The company used path analysis which
allows to identify the medium customer use to make payment. Therefore,the managers of
Ryanair add some extra node of payments so that their customers did not face difficulties. The
company also improves its boarding process, check-in process, booking process so that they can
offer good services to customers. Ryanair offers club membership to its customers in which the
customers get exclusive offers and services at the time of booking with Ryanair. This strategy
attracts more customers to using their services which automatically leads to increase in their
level of sales. In addition to this, the company did survey and research in market so that they get
to know about the new trends, customer choices, taste & preferences and so on that helps them in
satisfying their customers. With this, the company give thanking note with a personalized
message in order to feel customer valuable(Lawton, 2017) .
From the above, it has been stated that company uses different strategies and puts extra
efforts in maintaining good relations with customers. The company is always be on risk that is
they can lose customers any time. In order to decline the level of risk, the company should meet
the expectations of customers which is beneficial for both company as well as customers.
Investors: Those person who invest in the company and source funds. It plays a very
crucial part in organisation as the increase and decrease in the share of company is in their hands.
It is analysed that upper level authorities plan strong CRM activities so that they can attract and
influence investors to invest high amount in their company. Investors have the knowledge about

the targets and goals of the company. Customer relationship management helps in satisfying
customers which leads to increase in revenue of the company that directly affect the investors
and they invest more in the company(Leonidou and Hultman, 2019) . With this, Ryanair can
gain more market share as well as reputation.
Competitors: The competitors affect the sale or profitability level of the companies. They ave
the power to change to change the scale of the businesses. In context to Ryanair, the manager of
the company plan effective marketing strategies in order to strengthen the relation with
customers. CRM approach assist companies to build good relations with customers so that they
did not switch to other company and remains loyal with the organisation. It also helps in gaining
competitive edge and builds high market position. In addition to this, customer relationship
management assist companies to gain more customers as compare to its rivals.
Public: Nowadays, people prefer online services as compare to offline services. As it
saves the time of the customers. By the help of CRM approach, a company can build positive
image in the mind of customers. In context to Ryanair, the marketing team of the company
advertises about its offering on various channels such as Instagram, Facebook, Twitter, LinkedIn
and many more applications. This communication channels help companies to give services to
customers on time and solve their issues faster. With this, Ryanair strengthen its relationship
with customers for longer period of time.
2.2Evaluation of effectiveness of organization's response
Ryanair airline offers its services in many countries at international level. The strategies
formulated by the management assist in gaining success and compete with its rivals. The
company Customer relationship management is effective and plays an important part in attaining
goals on time. The potential and effectiveness of CRM on Ryanair Airlines is described below:
Customer are the assets for every company and the reason behind the survival of
company in the market. Customer relationship management plays an integral part because for a
company its customers always matters. Therefore, CRM help companies in building good
relations with its target as well as potential customers. Customer relationship management drives
customer loyalty for long term which is beneficial for both company and consumers. It helps in
managing and identifying the needs and preferences of users and thus improve the services as per
their customers requirements. With this, the marketing team who uses and conduct this approach
make the data and lads of interested customers which a company can convert into actual user in

future and thus increases its sales. By this way, they cut down their time and cost as well.
Through CRM activities, Ryanair collects the feedback of its customers which help them in
matching the expectations of customers and improving the services which they offer in the
market. The positive aspect of CRM is it builds strong relations which further strong the
position of company in market. CRM tools such as Twitter, Facebook, LinkedIn reachability is
wide that increases the customer base and sale of company. Interacting with customers on
continuous basis and remain touch with them feel customer's valued and special which further
helps company in maintaining positive mindset of customer(Pels, Njegovan and Behrens, 2017).
By the help of CRM approach, Ryanair handles the issue and problems of customers effectively
or in an appropriate manner.
On the contrary, customer relationship management have negative aspects also. Using
new technologies in making connections with people sometimes occur high cost for the company
which directly decline the revenue of the company. In giving the services to people, the company
needs a team who gives services 24 hours and this may occur high cost for the company. If the
organisation not able to fulfil the promises that had done with the customers creates the negative
mindset of customers towards the company. Poor communication and leadership skills also
affects the company image in market and thus companies did not build good relations with
employees. Companies uses CRM software in maintaining the data of customer's increases the
cost of the company. For this, company charge high amount from customers which directly
decline the level of sales of Ryanair.
2.3Areas of improvement in response to Ryanair
Ryanair, the Airline services which is famous for its high quality services in low fare.
The company adopts effective strategies to sustain and gain success in the market of Airline
industry. But there are some areas in which the improvement is required so that they can increase
its customer base and improve its market position. The company needs to follow all the
legislations so that they cannot engaged and waste their time in legal considerations. It can
reduce financial burden which positively effect on the pay scale of workforce. With this, the
company need to focus more on protecting the environment by adopting the environmental
friendly technology. In addition to this, the company can spent amount in CSR activities in order
to improve the living standards of people of society(Renwic, 2018). It will help Ryanair in

making healthy relationships with the people of society. In order to utilize the resources
optimally and efficiently, the Human resource manager of the company should hire talented and
educated staff who can help company in increasing productivity. With this, the company offers
job opportunities in the market that can improve the economic conditions also. In addition to
this, the company considers the strategies of its competitors while making plans for development
so that creative and effective strategy can be built which leads to increase in the level of profits.
It also assist company in making position in market and gain competitive advantage. At last, the
services or medium of communication with customers can be improve in order to gain loyal
customers and building relationships in the market.
CONCLUSION
From the above study, it has been concluded that macro environmental factors affects the
efficiency level of the organisation. PESTLE analysis assist organisation in analysing the
elements that impacts the growth of their businesses. The effective marketing strategies helps
companies in gaining more profit. The strategy is effective when it increases the customer base
as well as revenue of the company. In context to Ryanair, the upper level authorities of company
focuses in building those strategies which strengthen their relationship with customers. In
addition to this, they develop alternative plans and attractive offers to gain more customers.
Customer relationship management aid companies in improving their relations with potential and
present customers. Technology plays a crucial role in reaching and attracting customers such as
Facebook, websites, LinkedIn and so on. This innovation assist management in developing ang
growing in the market rapidly as well as effectively.

REFERENCES
BOOKS & Journals
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(Alvarez, 2016) (Anastase and Grigoruț, 2016) (Axelsson, 2018) (Barrett, 2016) (Boyer, 2014)
(Brewster, 2019) (Brocke and Rosemann, 2014) (Cui and Li, 2017) (Gamble, Peteraf and
Thompson, 2014) (Hagmann, Semeijn and Vellenga, 2015) (Lawton, 2017) (Leonidou
and Hultman, 2019) (Pels, Njegovan and Behrens, 2017) (Renwic, 2018)