Ryan-air's Strategic Management Analysis

The report conducts a SWOT analysis of Ryan-air's industry, highlighting its position as Europe's largest budget airline. It also explores the company's relationship with employees, suggesting that changes in employee compensation arrangements could impact the business. Furthermore, the report discusses strategic directions such as market penetration, development, product development, and diversification, which can contribute to high productivity and profitability in the global market.

Strategic management

Table of Contents
INTRODUCTION...........................................................................................................................3
Main body ..................................................................................................................................3
1.Background information of the company................................................................................3
2.External analysis of the Airline industry .................................................................................4
3.Brief competitor analysis-........................................................................................................5
4.Internal strategic capabilities....................................................................................................6
5.Strategic direction option.........................................................................................................7
6.Strategy selection and justification .........................................................................................9
CONCLUSION................................................................................................................................9
REFERENCES .............................................................................................................................10

INTRODUCTION
Strategic management refers to the process of controlling, monitoring and assessment of
all that is important for an organization in the accomplishment of business goal and objective.
Strategic management also involved bundle of decision and acts which a manager undertakes
and also it decides the performance of the firm(Ansoff and et.al., 2019). Report will high lights
the external analysis of the Ryan-airlines industry and also evaluates the internal environment of
the company. Ryan-air is recognized as a first and largest budget airline industry of the Europe.
It was founded in 1985 by the Ryan family. In this report we will also discuss the strategic
direction tools for evaluating the Ryan-airlines strategic choices and its future directions.
Main body
1.Background information of the company
Ryan-airlines is the first largest budget industry of the Europe and it was established in
1985 by the Ryan family for providing the scheduled passenger service between Ireland and UK.
At the initial level it was full of service carrier with two class of seating, leasing three different
type of aircraft. Ryan develop its self as Europe's favourite airline and as the worlds the largest
international carrier by passengers. Ryan use key aspects of various strategy for increasing the
productivity of the firm. It uses fair and route policies strategy to stimulate demand. It also
includes the low operating cost which is the heart of the Ryan-airlines strategy. This strategy can
effectively implement in the Ryan-air through Aircraft costs which can be down through
purchasing the aircraft from a single manufactures and it also reduces the airport costs for
maintaining the low operating cost(Strategic management, 2019). It includes the productivity of
the firm through providing various productivity based incentives to its employees. Ryan-air's is
considered as the successful company and the prime market leaser in the European world and it
heavily relays on the leadership of Michael O' Leary but at present the business strategy are

focus on the cost leadership and its cost leadership is not sustaining for the future growth. It
needs to maintain better link and healthy relation with unions in the future.
2.External analysis of the Airline industry
External analysis of Ryan-airlines industry can be effectively done through the pestle
analysis which includes the various factors such as political, social, technological, environmental
and legal factors.
P-political factor
Ryan-airlines is operating in Europe the stability of flight routes and destination my
guaranteed. The political institution such Eu affects the airline's industry by establishing various
rules and regulation or restriction like establishing EU competition law. The airlines also affect
sue to the Terrorist attacks last year in the Paris but it is just an assumptions and has no evidence.
E-economical
As already includes the case study that Ryan-airlines is operating in the Europe and earn
profits from a stable economy and the economic down turn did not change the low price strategy
of Ryan-airlines. It still provides the cheapest flights and noticing high customer demand for low
fares at its hard times. The exchange rate is also threat for the Ryan-air industry.
S-social factor
The customer is the main part of the every successful business and keeps it in existence.
According to the various type of Ryan-air's customer, different social factor create. Business
travellers are more service oriented and the leisure travellers more price oriented. The Ryan
provides the services to everybody in Europe avoiding distinguishing between
customers(Sammut‐Bonnici & Galea, 2015).
T-technological
Technological advancement also affect the business of the company because new
technological changes costly investments in the new air-planes and along with Ryan has to deal
with recycling, pollution and noise of the aircraft.
L-legal factor
Legal factor affect the airline's industry at very large extent because Ryan-air is subjected
to lawsuit by the European government for receiving state aid at certain airports of the Europe.
The Brexit may require Ryan-air to comply with the UK and EU regulations.

E-environmental factor
Ryan-air affected by the environmental aspects in terms of increasing the cost of the
Ryan-air due to the EU regulation of emissions for airlines which mandates airlines to operates
their business under EU emissions trading scheme. The company also has to focus on the
environmental initiatives through well maintaining its operations and facilities.
3.Brief competitor analysis-
The competitive analysis of the Ryan-airline industry can effectively identify through the
Porter's Five forces model which helps in providing the holistic view of an industry. It includes
the five forces such as Threats of new Entrants, bargaining power of supplier, bargaining power
of buyers, threats of substitute product and service and rivalry among the existing competitors.
The main competitors of Ryan-air's industry is British airways, Alitalia and Easy-jet.
Threats of the New entrants
The new entrants in the airline industry brings various innovations, new ways of doing
things and put the pressure on the Ryan-air by lower pricing strategy, reducing cost and
providing best services to consumers. Ryan-air has to maintain all these challenges for
safeguarding its competitive edge.
Bargaining power of the supplier
Most of the company in airline industry buy their raw material from various suppliers.
Powerful supplier in service sector use their negotiating power to gain high higher prices from
the Ryan-air's which results in the low productivity of the firm(Sharpley, 2018).
Bargaining power of the buyers
Illustration 1: porter's five forces model

Buyers plays an important role in the success of every business and they want to buy the
best products with good offers by paying minimum price as possible, Which puts a pressure on
Ryan-air's company's profitability in the long term.
Threats of substitute product or services
It shows when a new product and services meets similar customer needs in different
ways. The threat of substitute products is high when it offers a value proposition which is
uniquely different from present offering of the Ryan-air's. For example it has main competitors
such as British Airways which provides same service to consumers.
Rivalry between the existing competitors
Competition among the existing players in the airline's industry results in the sown prices
and also decrease the overall profitability of the Ryan-air's company. This competition does take
the toll on the long term profitability of the firm. For example Ryan-air's and Easy- jet has great
competition in the market place which decrease the profitability of the Ryan-air because Easy-jet
provides their services less prices as compared to the Ryan-air industry.
4.Internal strategic capabilities
The internal environment analysis of the Ryan-air industry can be effectively done
through the swot analysis which determine various aspects of the firm such as strength,
weakness, threats and opportunities. The strategic analysis of the of Ryan-air's internal factor
demonstrate strength which consider as a key success factor of the industry such as low cost, low
fares and innovation in the leadership and strategies(Razal, 2016).
Strength
 Ryan-air's established in more than 200
locations and cover 1800 routes in the
Europeans market.
 Ryan-air's low cost base is a key
competitive advantage for the firm in
the market place.
 It operates point to points flights with
in the short distance locations.
 It has string balance sheet and good
Weakness
 The relationship with its employees and
change in employee compensation
arrangement could impact the business
of the Ryan-air's.
 Overcapacity in the near future due to
the aggressive fleet expansion.
 Wide fluctuations in the price and
availability of the fuel because it
constitutes a key input cost.

shareholder returns.
Opportunities
 Ryan-air's has good scope to increase
ancillary revenues through my Ryan-
air.
 Opportunities in the declining charter
plan.
 It intends to grow by offering low fares
and fare promotions.
Threats
 Increase in Irish corporation tax rates.
 Fluctuation in fuel prices is threat
because it affects the company's
business model and profitability.
 Competition from other low cost
companies.
 ATC staff shortage & strikes in Europe,
it reduces the productivity of the firm.
5.Strategic direction option
The Ansoff matrix model is essential for strategic marketing planning. This model is
applied for identifying the various opportunities to grow revenue for the business by developing
new products and services into market. It includes four stages which provides the strategic
direction to Ryan-air's for its future growth such as Market penetration, market development,
product development and diversification(Ingason & Jónasson, 2018).
Market Penetration
Market penetration strategy provides the various factors which help the Ryan-air's to sell
their existing goods and services. It can possible through increasing the market share of current
products which can be achieved by a combination of competitive pricing strategy's, advertising,
sales promotion and various resources dedicated to personal selling.

The Ryan-air's use the low cost product strategy for providing fair travelling charges to its
consumers.
Market development
Market development is the growth strategy where Ryan-air's seeks to sell its existing
services into new market place. Ryan-air's can use this strategy through designing different price
policies to attract the different consumers and creates a new market segment. It also possible
through developing new distribution channel. For example Ryan-air develop the e-commerce and
online sides for booking from any location which creates the new markets(David & David,
2016).
Product development
With the help of the product development strategy Ryan-air's can achieve the higher level
of competitive advantage through introducing new products into existing new market. Ryan-air's
develops plan to offer budget fares on routes currently served by mainstream and higher cost
competitors, but expect to open new routes not currently served by any carriers.
Diversification
Illustration 2: The Ansoff matrix for strategic direction of Ryan-
air

It is the growth strategy where a business market new products in new markets. It is a
more risky strategy for Ryan-air's because business is moving into markets in which it has no
experience. Having become the largest international airline across the Europe with respect to
passenger carried, Ryan continues its growth ambitions. Ryan-air's can easily expand their
business globally because it follows the strategy of fare and route policies.
6.Strategy selection and justification
The Ryan-air have to focus on the market development strategy for improving their
business in the global market and also gain the desired level of result. The Ryan-air's can focuses
on the current and existing market for developing the strategies for the current and future
products. Ryan-air's have to use the law fair price strategy for improving their productivity and
also through this strategy company can attract new consumers(Graham, 2016).
The Ryan-air's can follow this market development strategy because in this strategic
direction company have to develop a new market for selling its existing goods and services and
Ryan can effectively enter into the new market for producing its goods and services because it
follows the low fare and routes policies which attract the customers towards the company. When
launching a new route, Ryan-air's policy is to price the new route at its lowest fare so that it will
be significantly lower than other companies but it still provides a satisfactory operating
marketing. As it is low cost airlines can efficiently enter into the new market form providing
existing goods and services to its consumers for achieving competitive advantage from the
market place.
CONCLUSION
The above study has been summarized that strategic management plays an important role
in the every successful industrial establishment because it provides the strategic direction to
employer for directing their business for achieving higher profitability. This report defines the
swot analysis of the Ryan-air's company which shows that Ryan-air's industry is the Europe's
largest budget airlines and it also shows that Ryan-air's relation with its employees are not fair
and change in employee compensation arrangement could impact the business of the Ryan-air's.
The above report also describes that strategic directions such as market penetration, market
development, product development and diversification plays an important role in the future
growth of the business in the global market which results in the high productivity and
profitability of the business.

REFERENCES
Books and journals
Ansoff, H. and et.al., (2019). Implanting strategic management. Springer.
Dale, C. and et.al., (2016). Business planning and strategy. Operations Management in the
Travel Industry, 21.
David, F. R., & David, F. R. (2016). Strategic management: A competitive advantage approach,
concepts and cases. Pearson.
Graham, A. (2016). Airport strategies to gain competitive advantage. In Airport Competition.
(pp. 109-122). Routledge.
Ingason, H. T., & Jónasson, H. I. (2018). Project: Strategy. Routledge.
Razal, R. B. (2016). Market Opportunity Analysis and Value Proposition Design for the Entry of
Yellowjet, a Philippine Low Cost Airline to European Mar-ket.

Sammut‐Bonnici, T., & Galea, D. (2015). PEST analysis. Wiley Encyclopedia of management.
1-1.
Sharpley, R. (2018). Tourism, tourists and society. Routledge.
Thomas, M. (2015). Ryanair: success before love. Strategic Direction.31(8). 1-3.
Tran, N. B. and et.al., (2015). Ryanair Holdings.
Online
Strategic management, 2019. [ONLINE] Available
through<https://searchcio.techtarget.com/definition/strategic-management>