Comprehensive Business and Strategic Management Analysis of Ryanair

This report provides a comprehensive analysis of Ryanair's business and strategic management. It begins with an executive summary and table of contents, followed by an introduction to Ryanair and its business model. The report includes a ratio analysis to assess the company's financial performance. It then delves into a VRIO analysis to evaluate Ryanair's resources and capabilities, followed by a SWOT analysis to assess the company's strengths, weaknesses, opportunities, and threats. The report utilizes the TOWS model to formulate strategies based on the SWOT analysis. Additionally, it examines the implementation of change management using John P. Kotter's eight-step model. Finally, the report offers strategic recommendations, including the SAF strategic model, and concludes with a summary of the findings and a list of references.

Running head: BUSINESS AND STRATEGIC MANAGEMENT
BUSINESS AND STRATEGIC MANAGEMENT
Name of the Student
Name of the University
Authors Note

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Executive summary:
The following study is based on the case of Ryan air. The aim of the study is to analyse the
business of the Ryan air and prepare the strategy for the company. The main scope of the study is
that it explains about the resources of the company by using the VRIO model and analyse the
importance. The environment of the company has analysed based on the SWOT and prepare the
strategy by using the TOWS model. There also discusses about the implementation of
management change by using John P Kotter’s eight-step concept. The study has concluded that
that the Ryan company need to concern about the human resource management and the quality of
the service in addition to some major resources analysed in VRIO.

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Table of Contents
Introduction:....................................................................................................................................3
Discussion:.......................................................................................................................................3
Ratio Analysis:.............................................................................................................................3
VRIO analysis of RYANAIR:.....................................................................................................5
VRIO framework of RYANAIR:............................................................................................7
SWOT analysis of RYAN-AIR:..................................................................................................8
John P Kotter’s model of change management in Ryan air:.....................................................13
Strategic Recommendation:.......................................................................................................17
SAF strategic model:.................................................................................................................17
Conclusion:....................................................................................................................................18
References:....................................................................................................................................19

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Introduction:
Ryan air is the first budget airline, which has inspired by the U.S. budget airline. This
report is basing on the case study given by Elearon O’ Higgins. The report has analysed about
the strategies of the Ryan air Company. The report discusses about the resources of the Ryan air
and classified based on the VRIO model. The opportunity and threat of the company analysed
through SWOT analysis. To, determine how to compensate the threat and take the advantage
from the opportunity of the environment TOWS model has considered for the study. All the eight
steps of John P Kotter’s model has discussed for implementation of the management change in
the company. At the end of the discussion there is a couple of recommendation has given to the
management of company.
Discussion:
Ratio Analysis:
Interpretation:
The net profit margin shows a lower growth from 2010 to 2012 while the revenue shows
a significant growth this denotes that company has a lower control over the NPM. A rise in NPM

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shows that the firm has higher debt financed and maximum of the money flow out in term of
interest. The ratio of gross profit margin has addressed a positive result that shows that there is a
control over the pricing of the good and services.
Interpretation:
The current ratio of the Ryan air is more than the standard ratio that is 2:1 in 2012 while
in 2011 and 2010 it was less than the standard. The cash ration of the company also more than
that shows the company is able to meet the financial obligation.

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Interpretation:
In 2012, the company has given a less period as compare to the preceding years, which is
analysed from the above ration analysis. The asset turnover ratio has shows that the company is
fails to use asset in fully efficiently as it is less or equal to 0.50 in the year from 2012 to 2011.
Interpretation:
The debt ratio shows that around 45 percent of the assets has financed by long term or
short-term debts, which is under control for the last three years. In other hand, the company has a
good operating income that is able to meet the current liability of the company.
VRIO analysis of RYANAIR:
VRIO is a framework using for business analysis, which help the firm to establish the
firm’s largest strategic scheme. VIRO stands for valuable, rareness, imitability and organisation.
VIRO is the internal analysis of organisation but it main concern about the evaluation of the
resources of the firm, to identify the phase of it falls under (Kotler 2015). This strategic planning
tool helps the company to determine a effective business decision. The VRIO analysis address
about the different qualitative, quantities information and the interpretation of the information

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gives a competitive advantage. This helps in identify and analysis of the resources in the
company.
The VRIO consider the resources of a company in the following dimension-
 Value – this admit about how expansive the resources and the convenient to collect from
the market.
 Rareness – this inform about the availability of the resources
 Iimitability – this states the difficulty in imitate the resources
 Organisation – this is the resources supported by the any present arrangements and can
the organisation use it properly

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VRIO framework of RYANAIR:
Resource/capacity Value Rareness Imitability Organisation
Aircraft
Maintenance
Fuel
Head quarters
Secondary airport
Ryan family and shareholder
Creditors
Discount from govt. And
airport
Innovative production
Online booking for passenger
Compensation for cancellation
Environment concern
Customer satisfaction
Brand image
Staff productivity
Team work and managerial
skill
Yes
Yes
Yes
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yes
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yes
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yes
yes
yes
yes
yes
yes
yes
yes
yes
yes
yes
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yes
As, of 2012 report of Rayan has 294 new Boeing 737-800 aircraft heaving more than
1500 flight per day. The company has 51 air bases across the 28 European countries. The
company has the own maintains department and has fuel support from the supporters.
In financial resources point of view the company has listed in UK stock exchange and it
raises the money from the capital market. Ryan provides the lowest cost airline service with

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highest profit and its capital comes from shareholders, creditors and government discounts
(Ahmed, et al 2019).
Ryan has the innovative production process that the reason why it gives the low cost
services. The brand image, patent, compensation to customer and copy right of the company are
difficult to imitate (Barrett 2016). This also value for the company.
There some intangible resources which of Ryan like its operational approach, the
reputation in the market, the unique routines, practices, the employee skills and experience which
is not possible to imitate in competitive concern.
Ryan has the best organisational capacity that it utilises the entire intangible and tangible
asset in an efficient manner to increase the productivity (Giurgiu and Borza 2015). The
operational capability of the company makes it the world’s most profitability airlines.
SWOT analysis of RYAN-AIR:
SWOT analysis gives the information about the environment by matching the firm’s
resources and ability with the environment in which it operates. This analysis address about the
key factor to concern with respect to the environment to develop the strategy and how, these
factors affect the company (Armstrong, et al 2014). The aim of the analysis is to determine the
strength and weakness of the firm that how it is able to deal with the changing environment
comprises of opportunities and threat. A SWOT includes two type of environment first external
(opportunity, threat) and internal (strength, weakness).

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Internal analysis:
This analysis focuses on the internal strength and weaknesses and can be identified by the
resources of which are analysed in the VRIO model.
Strength:
Strengths are like the fuel to the firm and give the advantage to the company. An
organisation’s strengths are its resources only, which can be use as to establish the strategy and
helps in achieve the goal of the firm. The following are the strength of the Ryan air-
 Ryan has reputed company in the airline industry and has a strong brand value. This is
the most recognised brand in the global
 The company has unique marketing strategy that is low-cost/low-fare model. This will
give it a competitive edge.
 The company has all of its aircraft is only Boeing-737. This policy is termed as
commonality policy, which helps the company in the cost reduction in term of
maintenance and spare parts. In addition, it helps in training and enhances the skill of
the staff.
 The company is lead by Michael O’Leary who is innovative and aggressive leadership
quality, which made the publicity of the company.
 The company has the innovation in the ticket booking sector because of that more than
90% of the ticket booking has done from online only. This helps in reduction in
intermediaries and distribution cost.
 According to the Air magazine, the Ryan is the world’s most profitable and successful
airline in the world with high number of flight and passenger (Phillips 2015).

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 The service quality of the Ryan is extremely good. The company has a strategy to clean
the flight in between a flight.
 Provide compensation to the customer on cancellation and delay in the flight, which
increase the loyalty of the customer.
Weakness:
This analysis determines the limitations of the firms that denote that there is absence of
some strength. Weaknesses are act as an obstacle for the company in achieving its objectives.
The main drawbacks are-
 There is poor working environment in the Ryan in the company which can be observe
that employee are not allowed to charge their phone to reduce the electricity bill.
 There is poor legroom in the flight, which create a negative perception in the mind of
customer.
 The secondary airport that company has at a significant distance from the city that
consume more time to travel and cost for the customer point of view (Graham 2013).
 There is a less strategy towards changing in the fuel price to hedge against the future
losses of opportunity cost.

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External Analysis:
Opportunity:
Opportunities are analysed from the analysis of external environment, which
enhance the profit and growth of the company. The positive factors surrounding the company
are-
 The company can dominant the European airline industry by increase in the quality
with the low-cost strategy.
 It mainly operation in the European continent so it has an opportunity to expand its
flight in the intercontinental level.
 Increase in the demand that is the rise in air travellers.
 There is an opportunity to increase the operational range by acquiring the small and
loss generating airline companies.
 The company can also enter into the logistics industry, which enhances the company’s
expansion and growth.
Threats:
The external environment is ever changing so it brings opportunities as well as the threats
which impact on the company’s operation. The threats may arise from the economic,
technological change, strength of the competitors.
 Fluctuation in fuel price has a threat for the company as the price in the international
market is rising which may hamper the low cost strategy of the company (Iñiguez,
Plumed and Martínez 2014).