Business Environment Analysis Report: Ryanair, UK Airline (Semester 1)

This report provides a comprehensive analysis of Ryanair's business environment, exploring various aspects such as different types of business organizations (private, public, and voluntary), their legal structures, and their purposes. It delves into the size and scope of these organizations, specifically focusing on Ryanair as a case study. The report examines the interrelation of organizational functions like marketing, finance, and human resources, and their impact on achieving organizational objectives. Furthermore, it conducts a PESTLE analysis to assess the positive and negative impacts of macro-environmental factors on Ryanair's operations. The report concludes with an internal and external analysis to identify the airline's strengths and weaknesses, and it evaluates the interplay of macro-environmental elements on the company's performance. Overall, the report offers a detailed overview of Ryanair's strategic positioning within the business landscape.

Business and business
environment

Table of Contents
INTRODUCTION...........................................................................................................................3
SECTION 1......................................................................................................................................3
P1 Different types and purpose of business organisation and their legal structure................3
P2 Size and scope of different types of organisations ...........................................................4
P3 Relationship between different organisational functions and their link with organisational
objectives................................................................................................................................7
..........................................................................................................................................................8
SECTION 2......................................................................................................................................8
P4 Positive and negative impacts of macro-environmental factors........................................8
TASK 4..........................................................................................................................................10
P5. Internal and External analysis of specific organisations in order to identify strengths and
weaknesses...........................................................................................................................10
P6 Interrelation of strengths and weakness of macro environment elements on a company12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment refers to both internal and external factors of a business
organisation that affects its overall performance. It includes customers, suppliers, technology,
laws and legislations and various other factors that are essential for a business organisation in
order to operate its business operations (Chetwood and et. al., 2014). In this present report, the
chosen private organisation here is Ryanair, which is a largest European airline. In this report,
purpose of private, public and voluntary organisation and their legal structure has been
discussed. In addition to this, relationship between different organisational functions, positive
and negative impact of macro environment on business operations and internal and external
analysis of a business organisation has also been discussed.
SECTION 1
P1 Different types and purpose of business organisation and their legal structure
There are various types of business organisation in a business market that are established
with a different aims and objectives. In this regard, there are majorly three types of business
organisation that is discussed below as:
Private organisation: The private organisation is a business entity which is run by
individual and companies rather than government. Their main motive is to maximise their
profitability in a competitive business environment (Crane and Matten, 2016). In this regard, the
chosen private organisation here is Ryanair which is the largest European airline.
Purpose of private organisation: The main purpose of Ryanair is to maximise their
profitability by providing best in class airline services to their potential customer in a business
environment.

Public organisation: The public organisation is a business entity which is owned,
managed and controlled by government authorities. Rather than earning profit their main motive
is to satisfy needs and requirement of their public (Gharajedaghi, 2011). In this context, the
chosen public organisation here is British Airways which is the largest British airline.
Purpose public organisation: The main purpose of British Airways is to provide best
quality airline services in order achieve societal aims and objectives.
Voluntary organisation: The voluntary organisations are non-profit organisation that are
established for welfare of the society. In this regard, the chosen voluntary organisation here is
Cancer Research UK which raises money through donations, community fund raising and
corporate partnerships.
Purpose of voluntary organisation: The main purpose of Cancer Research, UK is to
control rapidly increasing death due to cancer by conducting research for the prevention of
disease.
Beneath is the difference between serial, owner manager and intrapreneur :-
Intrapreneur Owner manager Serial
Intrapreneur is a person which
is working in an large
organisation and have rights
and behaviour like
entrepreneur of that
organisation.
Owner manager is the person
also known as entrepreneur, as
it is a person who use to lead
an organisation along with
managing it.
Serial is a type of entrepreneur
who use to make some
innovative ideas, so that they
can invest and start new
business.
P2 Size and scope of different types of organisations
Business environment is comprising of various types of organisation such as public,
private, voluntary, multinational organisations etc. The size and scope of different types of
organisation is discussed below as:
(a) Private organisation: The private organisations are established with a motive to
maximise their profitability by providing goods and services to their potential customers in

accordance with their needs and requirement (Gilboy, 2016). In this context, the chosen here is
Ryanair which is a private organisation.
 Background: The chosen organisation Ryanair is an Irish low cost airline founded on
28th November 1984 and its headquarter is in Swords, Dublin. It is one of the largest
airline that carries more international passengers.
 Products and services: In this context, Ryanair provides low fare airline and in-flight
services to their potential customers as compared organisation dealing in same market
segment.
 Size: The route services of the Ryanair is rapidly increasing as they serve in 35 countries
in Europe, North Africa and Middle east. It operates its airline services with more than
400 air-crafts and retaining its profitability in a business market as they provides low fare
airline services to their customers.
 Vision: The vision of Ryanair is to be Europe's leading low fare airline and continuously
improve its low faire strategy to satisfy its potential customers in a business environment.
 Mission: The main mission of Ryanair is to be the most profitable airline by providing
best in class airline services to their customers.
 Objectives: Ryanair's main objectives is to deliver best in class services to their
customers and also expand their business operations in a competitive environment.
 Structure: The chosen organisation Ryanair is operating its business activities with
formal organisational structure.
 Legal structure of private organisation: In this regard, legal structure of private
organisation is of two types i.e. sole proprietorship and partnership which are discussed
below:
(a) Sole proprietorship: In this legal structure, organisation is owned, managed and
controlled by a single person. Thus, a sole proprietor is responsible for entire profit and loss
arises while operating its business activities.
(b) Partnership: In this legal structure, two or more person come into an agreement in
order to control and managed a business entity. In this regard, they work as a co-owners and
shares equal profitability in a business organisation.
(b) Public organisation: The public organisations are monitored and managed by
government and are established with a motive for welfare of public (Li, and et. al., 2011). In this

context, the chosen public organisation here is United Kingdom Atomic Energy
Authority(UKAEA).
 Background: The chosen organisation United Kingdom Atomic Energy Authority and
it is a UK government research organisation that is responsible for the development of
nuclear fusion power.
 Products and services: The organisation,UKAEA is responsible for the development
of nuclear fusion power, nuclear weapons and provide other services that are related to
nuclear power and energy.
 Size: United Kingdom Atomic Energy Authority inherited nearly 20,000employees
which doubled to 41,000 by 1961 and in present it provide employment at a large level
and there are thousands of employees.
 Vision: Enable economic growth & new high tech jobs in UK industry and grow the
UK's nuclear technology capability.
 Mission: UKAEA's mission is to lead the commercial development of fusion power and
related technology and position the UK as a leader in sustainable nuclear energy.
 Objectives: Maintain the UK's position as a world leader in fusion research &
development.
 Structure: The chosen organisation United Kingdom Atomic Energy Authority follow
hierarchical organisational structure.
Legal Structure of public organisation: In this regard, legal structure of public
organisation is classified into two types which are discussed below as:
(a) State government: In this legal structure, their main role is to monitor all arrangements
formulated by legislations of a country.
(b) Local government: Under this legal structure, business entities operate their business
operations in order to satisfy basic needs of their people.
(c) Voluntary organisation: The voluntary organisation are non profit that are
established for betterment of the society (Meiners, Ringleb and Edwards, 2014). In this context,
the chosen organisation here is Cancer Research, UK formed on 4th February, 2002. Their main
motive is to control the increasing death causes due to cancer.

 Mission: Their main mission is to cure cancer by conductive effective research in order
to double survival rates.
 Vision: Their vision is to carry out world class research activities in institutes,
universities and hospitals with a motive to raise awareness about cancer.
 Products and services: They are protecting rights of cancer people for enhancement of
the nation.
 Size and Scope: It was established in 4th February, 2009 for generating awareness in
order to cure cancer.
 Objectives: Their main objectives is to conduct effective research in various institutions
for creating awareness about cancer.
Legal structure of voluntary organisation: The legal structure of voluntary organisation
includes association, trust, industrial and provident society which are discussed below:
(a) Association: This is the common form of unincorporated structure formed be small
and new groups in order to carry out the association activities. It is very cheap and
flexible as compared to other incorporated structure.
(b) Trusts: This incorporated structure is governed by trust deed and usually formed by
groups that does not require membership structure.
P3 Relationship between different organisational functions and their link with organisational
objectives
It is necessary for a business entity to perform its organisational functions efficiently and
effectively in order to achieve their specific aims and objectives in a business environment
(Sekaran and Bougie, 2016). In this regard, it is essential for the chosen organisation Ryanair to
perform its organisational functions like marketing, finance and human resource management
effectively in order to maximise their profitability. The major functions of different departments
and their relationship is discussed below as:
(a) Marketing: The major function of marketing department of a business entity to
promote their products and services in order to increase their customer reach. In this context,
marketing department of the chosen organisation Ryanair is inter-related with production
department because, it is essential for marketing department to know quality and uniqueness
regarding the products and services manufactured by production department.

(b) Finance department: This department works for providing financial stability to a
business organisation, which helps them in smoothly operating their business operations. In this
regard, the finance department of Ryanair is inter-related with production and marketing
department as it provides them funds, which helps them in manufacturing and promoting
products and services in a business environment.
(c) Human resource management: The major function of human resource department
of a business entity is to recruit and select right persons for a right job. They are also responsible
for improving employee’s performance by organising various training and development sessions.
In this regard, the human resource department of the chosen organisation Ryanair is inter-related
with finance department as for improving performance of its employees, they will have to
organise various training and development sessions that required additional funds.
The main advantage of inter-related functions is that, it helps a business entity in
achieving its specific aims and objectives in a shorter time span. On the other hand, inter-related
functions may create a conflicts among employees of a business entity.
(Illustration 1: Organisational chart, 2013)
(Source: Organisational Chart of a company, 2013)
Effect of micro businesses on economy of UK : As UK is a nation which is said as hub of small
and micro business, which use to perform their functioning in business environment of nation.
These micro businesses use to provide huge amount of tax to them, therefore they are said as
back bone of UK.

SECTION 2
P4 Positive and negative impacts of macro-environmental factors
The chosen organisation Ryanair is operating its business operations at a global level. In
this regard it is essential for this company to identify various external factors that effects its
business activities. The pestle analysis of Ryanair is discussed below as:
(a) Political factors: The political laws and legislations differs from region to region. It
includes taxation, laws and legislation, which affects the business operations of the chosen
organisation Ryanair. For instance: Ryanair is maintaining its large business base in UK but after
Brexit outcomes, it will affect its overall productivity in a business environment.
Positive impact: This factor will help the chosen organisation in operating its business
activities in a legal manner. For example, if there are make change in the government policies
and they are favourable for the organisation than it create positive impact on the business of
Ryanair.
Negative impact: The new taxation policies and legislative laws will effect overall
performance of a business entity in a dynamic business environment. For example, if the
company operate its business in those countries which apply high tax rate that create negative
impact on the business of the company.
(b) Economic Factors: This factor includes rate of inflation, interest rate, foreign rate
that can affects economic stability of the chosen organisation Ryanair. For instance, if recession
will occur in UK then it will create difficulty for Ryanair to maximise its profitability.
Positive impact: At the time of good economic condition, this factors will help in
increasing productivity of the chosen organisation as it increases purchasing of their customers.
In Ryanair, it is related to the economic condition of the company if the sales of the organisation
increase it create positive impact on the economic condition of the company and country also.
Negative impact: On the other, economic instability will leads in decreasing purchasing
power of their potential customers that will eventually effects productivity of the chosen
orgpriya.sanisation. If purchasing power of the consumers are decreased, it create negative
impact on the economic condition of the company.
(c) Social factors: This factor includes demographic class, educational level, culture etc.
In this context, Ryanair is providing low fare airline services to their customers that will helps
the chosen organisation in changing lifestyle of their potential customers.

Positive impact: This factor will help in improving brand image of a business entity in a
business environment. If the company produces the products and services according the
consumers demands and provide satisfaction to them, it create positive impact on the business of
the company.
Negative impact: If a business organisation is unable to achieve societal aims and
objectives, then it will leads in decreasing their demand. If the company provide high pricing
services, it create negative impact on the business because at high price most of the customers
are not able to purchase its services that create negative impact.
(d) Technological factors: In this context, it is essential for the chosen organisation to be
technologically advanced in order to sustain their productivity in a business environment.
Positive impact: Adopting latest technologies in operating business activities will help a
business organisation in achieving their goals and objectives in a shorter time period. If the
company adopt new technologies and provide satisfaction to the consumers needs it can be a
positive impact for the business o0f the organisation.
Negative impact: On the other hand, it effects employee’s overall performance as
sometimes they are not comfortable in using new technological tools and equipments. If the firm
do work according old technologies this create negative impact on the business of the
organisation.
(e) Environmental factors: In this regard, it is essential for the chosen organisation to
operate their business activities in a eco-friendly manner. This factor is related to those activities
that are perform by the company and not impacted the environment negatively.
Positive impact: This factor will help the chosen organisation in operating their business
activities in accurate manner without effecting environmental resources. Ryanair can use use eco
friendly things that are not harmful for the company.
Negative impact: As Ryanair is providing low faire online services, it creates difficulties
regarding optimum utilisation of environmental resources. It is related to the harmful activities of
the company that crete negative impact on the business of the company.
(f) Legal factors: In this context, it is important for the chosen organisation to identify
legal market factors before expanding its business operations. It is related to the laws and
legislations of the company and government.

Positive impact: The legal environment of UK is stable which helps the chosen
organisation in increasing their demand. The laws that are in favour of company create positive
impact on the growth of the organisation.
Negative impact: The Brexit scenario will leads in reducing demand of Ryanair as it
separates UK from European Union. Those laws and acts which are unfavourable for the
company create negative impact on the firm.
TASK 4
P5. Internal and External analysis of specific organisations in order to identify strengths and
weaknesses.
The process undertaken by an organization to determine its strengths and weaknesses, as
well as the opportunities and threats, this process is considered as Swot analysis of an
organizations (Saleem, 2017). Ryanair DAC is an Irish low-cost airline founded by Michael
O'Leary in Swords, Dublin, Ireland in 1984. This article summarizes about the internal and
external analysis of Ryanair DAC.
Strengths opportunities
1. Low Costs – Characteristics that will help to
achieve positive outcomes or Organization
goals. Ryanair has the lowest cost of any
airline in the economy whether measure as
CASK or cost per passenger.
1. Brand Perception – If the company launch
new product within its existing brand it carets
opportunity for the company. It will attract
more customers because the brand is already
known with the consumers (surveys). This help
the company to provide various opportunities
such as increasing sales and earning profit etc.
2. Innovation -Most of the organization talk
about innovation but being really innovative
requires from the customers, that they never
seen before. No European airline has done
more changes in the creation of short haul
flying than Ryanair and after this innovation
has become key to the success for Ryanair.
2. Seasonality of earnings – In this factor, the
organisation can provide seasonal offers by
providing offers an discount and create
opportunities for the business of the company.
For example, Ryanair can provide offers in off
season and use discount pricing strategy that
raise an opportunity for the growth of the firm.

Weaknesses Threats
1. Improved customer Service – Ryanair has
moved towards raising the quality of its
passengers which include redesigned website
with more fascinating look and with fewer
clicks to make a reservation.
1. Accident – This states about the accidents
which happens due to climate conditions and
also by mistakes made by the pilot.
2. Business Travellers - Ryanair has recently
establish its business traveller product. This is
a packet product, offering a scope of attributes
for a single fee, including booking flexibility,
choice of reserved seating in premium rows
and a checked bag.
2. Loss of Focus – These conditions occur
when the organization distracted from its core
competence of rendering risk-free and timely
short-haul air travel at low fares.
P6 Interrelation of strengths and weakness of macro environment elements on a company
In this context, there are various macro environmental factors that affects overall
performance of a business entity from both positive and negative perspective (Zsambok and
Klein, 2014). The strength and weakness of macro-environmental factors discussed below as:
Factors Strengths Weaknesses
Political factors The present regulation in UK is
stable regarding air traffic, that will
help Ryanair in operating their
business activities effectively.
The unfavourable Brexit outcomes
will leads in effecting their
productivity.
Economic factors Ryanair is providing low fare airline
services to their potential customers
because economic stability of UK.
At the time of recession, it
decreases purchasing power of
Ryanair's customers. This will
affect their productivity.
Social factors They are providing low fare airline
services helps in changing lifestyle
As Ryanair's has moved towards
raising the quality of services

of their customers. which has led to fewer clicks to
make reservation.
Technological factors Ryanair has brought innovation in
their technology which has become
a reason for success for that
company.
Ryanair has launched a business
traveller product which has caused
a decline in growth of reserved
business travellers.
CONCLUSION
From above mentioned report it can be concluded that business environment is a sum
total of all internal as well as external factors. Types, size and scope of private and public
organisations Interrelationship of different functions such as marketing, finance and human
resource within an organisation is discussed. PESTEL is being elaborated to show negative and
positive impact of macro environmental factors. SWOT analysis is used to analyse internal and
external environments of Rynair.

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