Ryanair Case Study: Challenges, Solutions, and Management Theories

This report presents a case study of Ryanair, a prominent Irish budget airline, addressing challenges such as rising costs, Brexit uncertainties, and staffing issues. The analysis begins with SWOT and PESTEL frameworks to evaluate Ryanair's internal and external environments, identifying staffing issues as a primary concern. The report then proposes solutions based on two management theories: Maslow's Hierarchy of Needs and Adam's Equity Theory, aiming to improve employee motivation and address staffing challenges. The application of these theories aims to enhance employee satisfaction and performance. Finally, the report includes a reflection on the project experience, providing a comprehensive overview of the analysis, proposed solutions, and the learning process involved.

Ryanair Case Study

Table of Contents
INTRODUCTION...........................................................................................................................1
1. SWOT and PESTEL analysis for Ryanair..........................................................................1
2. Using analysis from task 1, identification of main problem faced by company................4
3. Proposed solution to the problem identified above using at least TWO management theories
................................................................................................................................................4
4. Short report on the experiences driven while doing the project.........................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
The following project is based upon the case study of Ryanair which is a globally
renowned Irish budget airline which was founded within the year 1984. This organisation is
acknowledged to be encountering several challenges like increment in overall cost, uncertainty
associated with BREXIT and staffing problems. Along with this, Ryanair has also been dealing
with negative media coverage done over its employee relation, customer services and dispute.
The report seeks to explore the internal and external analysis of the airline by way of conducting
PESTLE and SWOT analyses. Along with this, it also includes main issues faced by Ryanair
requiring immediate action to be taken along with the rationale. Further, the solutions to these
issues are stipulated by application of management theories and concepts. Lastly, overall
experience driven by an individual over the course of project is provided with the help of
reflection.
1. SWOT and PESTEL analysis for Ryanair
It is important for an organisation to constantly keep screening its external and internal
environment with a view to gain knowledge of the opportunities and threats associated with
them. In this relation, Ryanair is acknowledged to be facing a number of issues since some time.
Thus, the management of this corporation is conducting external and internal analyses to gain
knowledge of the domains whereby changes can be made or new policies can be introduced to
improve the organisational situations. The external and internal analyses are being done by
Ryanair with the help of PESTLE and SWOT frameworks as follows:-
SWOT Analysis
It is an internal screening framework which is put to use by companies with a view to
gain knowledge of the positives and negatives that possess the potential of affecting the
organisation in the long run. Through the application of this framework, the management of
Ryanair seek to gain an overview of the present internal situation so as to implement
management theories and business strategy accordingly. Thus, the SWOT analysis in the light of
Ryanair is presented as beneath:-
STRENGTH:
One of the most prominent strengths of Ryanair is acknowledged to be its provision of
low cost airline facilities. This provides assistance to the corporation in gaining the attention of
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large number of individuals. By providing them satisfactory quality services at low rates, the
entity is able to gain their trust and instil loyalty within them towards the airline. In addition to
this, it is identified that this is widely renowned across the globe, especially in Europe whereby it
has a large base of loyal customers and extensive brand goodwill. Ryanair has the biggest short
haul network carrier through provision of its facilities across 1600 routes within the confines of
over 32 countries.
Illustration 1: Top 10 Airlines ranked by Seats Europe to Europe
WEAKNESSES:
With the passage of time, it is identified that the biggest weakness of the firm lie in
employee compensation related systems. This is one aspect that has largely been lowering down
the efficiency of Ryanair by a significant margin. Further, the entity holds weak brand perception
owing to poor performance recognition and award systems along with the absence of polls and
surveys to gain knowledge of views and opinions of people.
OPPORTUNITIES:
By enhancing customer interaction, Ryanair has the opportunity of inflating its goodwill
and resultant its sales. Further, with re-designing of the website, entity can gain the attention of
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large number of customers. Ryanair can even provide booking facilities, fast end security and
reserved seating facility to people in a single fee.
THREAT:
The biggest and the most apparent threat faced by Ryanair is BREXIT which has resulted
in to decline in the value of pound. This affects the sales as well as profit margins of the
respective airline by a significant percent age. Further, the entity faces shortage of staff due to
high turnover ratio. Apart from these, intense competition within the confines of airline sector is
yet another threat that has been dampening the goodwill and positioning of the company at the
market place.
PESTEL Analysis
It is an external analysis framework which is applied by companies with the sole motive
of gaining knowledge of the impact placed by factors of external business environment upon the
activities and business functioning. The management of Ryanair is conducting this analysis with
a view to identify the challenges that have been affecting the company along with the
opportunities that can be tapped by the airline to ensure its long term sustainability within market
place.
Political Analysis
Rise in rate of passenger taxes from current rate may impact upon overall sales of ticket
by air making people shift their trend to other modes of transport. This will place a significant
impact over the sales and profit margins of the entity. Yet the political stability of European
countries tends to provide support to Ryanair to facilitate growth and development.
Economic Analysis
The downfall in the value of Pound owing to BREXIT affects the profitability and sales
of the respective airline. Yet the opportunity such as decline in oil price inflates the profits for
the corporation.
Social Analysis
The per capita income of individuals and Britain is relatively higher than other countries.
This influences people to travel thereby creating opportunity for Ryanair to enhance its existent
level of sales and profit margins.
Technological Analysis
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With the rapid advancements taking place within the domain of technology, it can be
analysed that Ryanair has the opportunity to leverage the use of digital technology in an effective
manner for the enhancement of its profits. Social media marketing can be used by the
corporation in a better manner for gaining the attention of large number of individuals towards
the low cost airline facilities.
Environmental Analysis
Customers in the present time are largely concerned about the environment. They only
prefer to stay connected with those brands which operate in an eco friendly manner. Thus,
Ryanair should ensure that it releases the least possible carbon footprints so as to act in the
interest of nature.
Legal Analysis
It is essential for Ryanair to operate in the interests of law. In this regard, the airline
industry has a number of standards related to safety and security of travellers that should be
followed by the organisation at all the times.
2. Using analysis from task 1, identification of main problem faced by company
As per the discussion done above with PESTLE and SWOT analyses, it can be determined that
staffing issue has been largely affecting the function of Ryanair in the long run. In this regard, it
has been acknowledged that the problem of high staff turnover is affecting the airline firm the
most. This is owing to the lack of motivation within them. Along with this it has been identified
that due to shortage of workers in organisation, Ryanair faces low production level. This
significantly affects profitability of company and thus needs to be dealt with, within due course
of time.
3. Proposed solution to the problem identified above using at least TWO management theories
As per the analysis of Task 2, it has been determined that the main issue faced by Ryanair
is staffing challenges. It is highly important for the respective airline company to take into
account the staffing challenges and thereby undertake measures or theories through which these
can be effectively tackled in due course of time. With respect to this, it is determined that
motivation is a factor that drives the behavioural pattern and performance of individuals in a
positive manner. Looking upon this, the management of Ryanair is applying motivational
theories. With this, the company seeks to address the staffing challenges and motivate them to
put their best foot forward for the accomplishment of organisational goals and objectives.
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Maslow's Hierarchy of Needs
Maslow's theory is a motivational theory that comprises of five models. Every individual
has different needs and have goal oriented behaviour. It is depicted as the 'Need Hierarchy
Model' because needs are driving force of an individual. One need is satisfied, other rises up as
they are never satisfied. The five needs of Maslow's hierarchy are given below as follows:
Physiological needs: These are the basic needs of human survival like food, shelter, air,
clothing etc. These are the primary needs of an individual without which human needs cannot be
satisfied. These needs are very important as without these needs, an individual can't survive. To
meet this level of needs of employees, Ryanair maintains a fair compensation system whereby
individuals are provided with salaries and benefits in accordance with their job role as well as
responsibilities.
Safety and Security needs: The safety and security needs become secondary. These
include financial security, health and wellness and also safety against accidents and injury etc.
This need play a vital role in motivating the human's behaviour. This need of employees
belonging to Ryanair is fulfilled by the company through providing them medical insurance, life
insurance and many more facilities.
Social Needs: The social needs in Maslow's hierarchy includes friendship, family, social
needs, etc. play an important role in human's life. Today, it is important for people to be loved,
and accepted by other people in order to overcome stress, depression and anxiety as this need
fulfil their basic needs. This need of employees is met by Ryanair through arrangement of
informal get together and parties whereby individuals can get along with each other and know
each other on a personal level.
Esteem Needs: The fourth need of Maslow's hierarchy need is esteem needs which mean
needs of sense of appreciation and self respect. After fulfilling above three needs, it is important
for people to gain prestige, self esteem and recognition. People can achieve this by doing hard
work and having confidence in their abilities. Ryanair fulfils this need of employees by
recognising and rewarding the deserving and efficient individuals in frequent intervals of time.
Self Actualization Needs: These are the needs which develop one's potential. In this
need, an individual accomplish everything what he desires. The self actualization needs are
characterised by risk taker, hard working, responsible individuals etc. They are innovative and do
the things in a creative way and in a unique way. This need is fulfilled by Ryanair by carrying
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out training and development sessions for the employees such that they can be given
empowerment opportunities.
Adam’s Equity Theory
This theory was developed by American psychologist John Stacy Adams who
emphasised on to the proper equality of the work and its outputs in the organisation. The input of
the work is considered as the practice or execution for any respective task and activity that is
required to achieve the goals and objectives of the business. Thus the output is termed as the
reward that is provided to the employee and the workforce in place of their extensive
performance in the work, this is comprised of salary, remuneration, rewards, bonus, appreciation
tokens, salary appraisals etc. All of these elements are needed to be distributed among the work
force in order to maintain the effective and positive work flow. These outcomes are based on the
respective input thus it is provided according to the performance and on the basis of achievement
level. There is an another important factor that ios considered while implementing this theory in
the company that is to maintain the effective balance among the both input and output of the
employee. The basic needs and desired demands of the individual are fulfilled accordingly under
the principles of this theory. Thus in relation of Ryanair it can be easily determined that the
effective implementation of the Adam Equity theory helps the company to identify the needs and
demand of its people which leads to the ultimate enhancement in their motivation. The work to
maintain the proper fairness of outcome distribution also leads to less case of job dissatisfaction
among the employees as well as it does make them more loyal and dedicated towards their job in
the organisation. The management of the equity is the foremost priority of this theory which is
applied and certainly achieved by maintain the balance among the elements of input of loyalty,
hard work, dedication, skills, knowledge, efforts etc of the employees and the output that
organisation provides in the form of recognition, profit sharing, challenges, authority and
responsibility, salary, bonus etc.
4. Short report on the experiences driven while doing the project
The overall experience drawn by me as a result of undergoing this project was a mix of
positives and negatives. While collecting data for the assignment, my researching skills helped
me a lot. As a result of this, I was able to collect data from a wide array of sources such as books,
journals, articles etc. Further, critical thinking skills allowed me to look at every piece of
information from critical point of view. Through the application of this skill, I was able to
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identify which data should form a part of my project and which should not. In addition to this,
my analytical skills enabled me to undergo carry out an internal and external screening of the
business environment of Ryanair. For this purpose, I selected two strategic management models
named SWOT and PESTLE analysis about which my tutor had already given us lessons. By
applying the learning from my class lessons, I was able to effectively determine the positives and
negatives of internal and external environment for the concerned company. Apart from this, data
interpretation skills allowed me to collect and write information based on graphs and bars within
the assignment. Apart from this, evaluation skills provided assistance to me in examining the
case study in a manner such that answers to it could be effectively developed within due course
of time. The negative aspect associated with the project was my ineffective written
communication skills which created hurdle for me while jotting down the information collected
from various sources within the project. Yet another thing which affected my performance was
lack of IT skills which created issue for me while collecting information from online sources.
CONCLUSION
On the basis of above discussion, it has been analysed that internal and external screening
of the business environment is essential for each and every company across the globe. PESTLE
and SWOT analyses are the strategic management models or tools which provide assistance to
the corporation in gaining knowledge of the positives and negatives associated with business
environment. Further, it is identified that motivational theories provide assistance to a company
in dealing with challenges linked to staffing. Also, it helps the entity in reducing the staff
turnover ratios.
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REFERENCES
Books and Journals
Dobson, P.W. and Piga, C.A., 2013. The Impact of Mergers on Fares Structure: Evidence from
European Low‐Cost Airlines. Economic Inquiry, 51(2), pp.1196-1217.
Abeyratne, R., 2014. Market Based Measures. In Aviation and Climate Change (pp. 69-81).
Springer, Cham.
Myro, S., Légidos, B.R. and Hernández, P.I., 2013. Effect of low cost airline companies on
international tourism in Spain. Estudios Turísticos, (198), pp.61-79.
Abeyratne, R., 2014. The Challenge Faced by ICAO. In Aviation and Climate Change (pp. 83-
105). Springer, Cham.
Angelopoulos, P. and Leivo, P., 2013. Drivers and barriers for relocation of freight operators to
smaller airports-A case study at Jönköping airport (Axamo).
Naletina, D., Damić, M. and Jabučar, A., 2019. Customer Satisfaction with Services of Low-Cost
Carriers at Pula and Zadar Airports. InterEULawEast: journal for the international and
european law, economics and market integrations, 6(2), pp.71-97.
Ferro, F.I.V., 2018. Equity research-Ryanair Holding PLC (Doctoral dissertation, Instituto
Superior de Economia e Gestão).
Abdi, M.R., Elliot, L. and Edalat, F.D., 2016. Strategic Business Plan Based on Total Quality
Management for Property-Marketing Small Enterprises in UK. In Handbook of Research
on Entrepreneurship in the Contemporary Knowledge-Based Global Economy (pp. 509-
527). IGI Global.
Smircich, L., 2017. Concepts of culture and organizational analysis. In The Anthropology of
Organisations (pp. 255-274). Routledge.
Shields, J and et. al., 2015. Managing employee performance & reward: Concepts, practices,
strategies. Cambridge University Press.
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