Ryanair Strategic Analysis: Internal, External Environment & Planning

This report provides a detailed analysis of Ryanair's business strategies, focusing on both the macro and internal environments. It begins by implementing frameworks such as PESTLE, stakeholder analysis, SWOT analysis, and the Ansoff matrix to assess the impact of the macro environment on Ryanair. The report then evaluates Ryanair's internal environment and capabilities using frameworks like the resource-based view, McKinsey's 7S model, and the VRIO framework. Porter's Five Forces model is applied to analyze competition within the marketplace. Furthermore, the report analyzes Ryanair's strategic planning using concepts, theories, and models such as Bowman's strategic clock and Porter's generic strategies, providing a comprehensive overview of the airline's strategic positioning and potential areas for improvement. Desklib provides access to similar solved assignments and resources for students.

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Business strategy

Contents
lINTRODUCTION..........................................................................................................................1
lTASK 1...........................................................................................................................................1
lP1- Implementation of frameworks for analysing the impact of macro environment of the
organisation..................................................................................................................................1
lTASK 2...........................................................................................................................................5
lP2 Evaluate the internal environment and capabilities of company using appropriate
frameworks..................................................................................................................................5
TASK 3............................................................................................................................................7
P3 Applying Porter's Five Forces model used to analyse the competition within a marketplace
for an organisation.......................................................................................................................7
TASK 4............................................................................................................................................8
P4 Applying a range of concepts, theories and models, analyse strategic planning for given
organisation..................................................................................................................................8
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................10

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·INTRODUCTION
Business is defined as an entity where the main goal is to earn maximum profit for
generation of cash flow through business operations. It is crucial for organisations to innovate
strategies for establishing themselves in the competitive market place. Business strategies are
methodologies through which a business operation achieve their desired organisational
objectives. These strategies are usually long term plans of the organisation which involves
guiding principles that ensure proper decision making. The chosen organisation for this
particular report is Ryanair founded in the year 1984, headquartered in Swords, Dublin. Ryanair
is an Irish airline, sister to Ryanair UK, Alta Air and Buzz (Centobelli, Cerchione and Ertz,
2020). This report highlights appropriate models for external and internal analysis along with
porters five forces. The discussion also revolves around business strategies adopted by Ryanair
using bowman strategic and porters generic clock.
l壱TASK 1
l弐P1- Implementation of frameworks for analysing the impact of macro environment of the
organisation
Macro environment of an organisation consists of external factors which influence the
working of a business organisation. Business strategies are a set of principles opted by
organisations to build a brand image in the marketplace. Ryanair, has implemented many
business strategies to ensure achieving the organisational goals in a smooth manner.
Mission statement offered by Ryanair is to provide low fare to passengers to ensure
increased traffic of customers. The main aim is to ensure cost and operational efficiency.
The main objective of Ryanair is to establish their position as the company offering cost
effective travelling fares to its passengers (Malone, 2020).
Strategic planning techniques
·Business analysis: Analysis of business operations ensure continuos analysis of strengths and
weaknesses of the organization by rectification of loopholes.
·Benchmarking: Benchmarking is a practice through which an organization is able to compare
its goals to its competitors for establishment of a unique brand image. Ryanair should compare
their organisational growth with their respective competitors and implement strategies
accordingly .

Analysis of the macro environment
PESTLE ANALYSIS
Pestle analysis is a framework for analysis of the macro environmental factors
influencing the operations of an organisation. Therefore, in context to Ryanair, pestle analysis is
described as follows:
·Political factors: This particular factor analyse the role of governmental intervention in the
economic growth of the business operation. In context to Ryanair, there is a negative impact on
selling of the ticket when government imposes passenger tax rates. UK government has hike the
prices of tax by three times which has affected the sales of the organisation.
·Economic: This factor analyses the economic growth and interest rate of the organisation to
check the profit aspect (Özo?lu and Topal, 2020). Ryanair was badly affected when the price of
pound dropped.
·Social: This factor involves beliefs and attitudes of the general public towards the business
operation. Ryanair was profiting from passengers who love to travel for long and short distances.
This is because Ryanair offers the cost effective flights.
·Technological: Ryanair can employ the use of technology by providing excellent and feasible
services to its customers by use of mobile applications for booking tickets.
·Legal: This factor is related to laws and legislations through which a business can operate
smoothly. With reference to Ryanair, the use of lost cost strategy has negatively impacted the
operations of business.
·Environmental: The analysis is based on environmental changes that influence the working of
business operations (Purba, Fransisca and Joshi, 2021). Ryanair, being an airline company
releases carbon footprints which is alarming for the environment impacting the smooth
functioning of the business.
Stakeholder analysis
This step is considered crucial in producing business strategies for delivery of high
quality products or services. The barriers are uncovered and removed as the project progresses.
Power interest grid will be used for stakeholder analysis of Ryanair.
·High power-high interest: These are individuals who are employed in the top management
chain of the company and are also the decision makers, therefore, they need to be closely

monitored. Decisions made by managers at the top level of management in Ryanair will impact
the business.
·High power- low interest: These employees are required to be kept in loop as they are given
essential details about the business for satisfactory purposes.
·Low power- high interest: Travel agents are the stakeholder under this category who have no
role in the company but are required to be informed (Sawe and et.al., 2021). Travel agents for
Ryanair ensure that services offered by the business are adequately delivered to consumers.
·Low power-low interest: This category involves stakeholders who might lose interest with
excessive flow of information. Airports are an example of this category where there is no power
and interest in Ryanair.
SWOT Analysis
SWOT analysis is a framework used in the rectification of strengths, weaknesses, threats
and opportunities in a business operation to ensure implementation of effective strategies. With
reference to Ryanair, SWOT analysis is given as follows:
·StrengthsWeaknessesRyanair owns about 450 fleets which are considered its biggest
strengths. The goal is to increase the number to 600.
·Consistency of providing cost effective fares is another strength of the organisation. This is
done to ensure customer attraction. Along with low fares, this company offers non essential
services as add-ons. This particular organisation does not offer cash based refunds because of
which many customers are dissatisfied. The vouchers offered by the company are time limited
(Thota, 2018).
·The reputation of business was negatively affected due to cut down of 3000 jobs resulting in
work laid off.

·OpportunitiesThreatsRyanair have realised the opportunity and decided to take loan of 800
million euros from Bank of England Covid Corporate financing facility. The company can use
the amount in order to expand the business.
·Due to restrictions imposed by many governmental agencies on travelling across the
boundaries, manufacturers of airlines get majorly affected so Ryanair can adopt that opportunity
and make plan to purchase many airlines at low cost. The biggest threat is that Ryanair is unable
to control the governmental regulation as it infringe the norms implemented by government
during Covid conditions which highly affects the brand of the image.
·Another threat is lack in access of air traffic due to Covid 19 pandemic. It takes time for air
traffic line to back to normal till the sufficient availability of vaccine in nation (Farrukh, M., and
et. al., 2020).
·Ansoff matrix model
Ansoff matrix is a tool utilised by the organisations to analyse and plan the strategies to
attain growth. The model consists of four strategies which a firm can adopt with the purpose to
expand the business. It reference to Ryanair, it is exampled below-·Market penetration- This strategy concerned with increase the sale of the existing product in
the existing market. Market penetration strategy does not frame with the purpose of introducing
or bringing any new product or service at the marketplace but to improve sales of existing
product only. Ryanair organisation can think of adopting this strategy to enhance the sales
volume by providing same services to the existing marketplace.·Product development- This strategy focus on bringing new product or service at the existing
marketplace. With this strategy companies intends to attract more consumers to their firms by
providing them the product or service of their use within the existing market. Ryanair can adopt
for strategy and may plan to introduce some new product in the market so that more costumers
get attracted and satisfied with the services in the existing market and firm can have an
opportunity to grow their business remarkably (Agustina, K. and Karyono, O., 2019).

·Market development- This strategy concerned with using the existing product but in the new
market in order to attract more customers to the firm. Ryanair can adopt this strategy to create
new customer base in new marketplace by providing existing services in less cost.
·Diversification- This strategy focused to introduce new product into new market. It denotes the
complete diversification of the company. Diversification involves high risk for an organisation.
Ryanair may choose top adopt for this strategy but company will need a high investment value to
entering into a new market with new offerings.
Ryanair is recommended to opt market development strategy to introduce same product
into new marketplace. This does not leads to burden the company with high investment cost and
company can attract consumers and expand business to a new locality.
l壱TASK 2
l壱P2 Evaluate the internal environment and capabilities of company using appropriate
frameworks
Strategic capabilities and their key components
This process involves the procedure to improve and enhance the strategy of business in
order to gain the competitive advantage in market. There are six elements of the strategy the
includes tools, purpose, values, vision, and action plan. All these elements assist in increasing
the effectiveness of strategy to accomplish the goals of the operations (Maniora, J., 2018).
Resource based view strategy
This managerial framework used by the companies to determine an effective strategy that
may help company to become stable and sustain for long run in competitive marketplace. There
are mainly two types of resources that is, intangible and tangible. Ryanair is smart enough to
manage their resources as the organisation understand the value of using and managing the
resources in an appropriate manner to prepare unique products for consumer use.
McKinsey's 7S model
This framework helps the firm to evaluate their design by considering seven internal
entity which can help to determine the alignment effectively and allow firm to take steps to
achieve the objectives. In reference to Ryanair, it is mentioned below-

·Strategy- It is the plan that an organisation choose to achieve the competitive advantage in the
marketplace. Ryanair made an strategy to offer low fare tickets to passengers in order to attract
more consumers to the offering and try to sustain in competing market (Wadström, P., 2019).
·Structure- It represents the manner in which an organisation's different units and divisions are
being organised. In context to Ryanair, organisation have a hierarchical structure which consist
of a long chain of communication which flows from up to down.
·Systems- It includes the procedure of a company in which a firm used to operate their daily
operations. The Ryanair have access to both technology and manual operations that makes their
work easy and quick.
·Skills- Skills are the abilities that help an organisation to perform effectively and efficiently.
Ryanair provides training to their employees so the employees can serve better, convince
customers and provide better experience to all customers.
·Style- It involves the approach in which an organisation is being managed by other top
management system. Ryanair follows the combination of transformational and autocratic
leadership style in which one leader have complete authority to make decisions (Kong, D., and
et. al., 2020).
·Staff- It is concerned with number and types of employees serving for the organisation.
Approximately 17500 employees used to work for Ryanair, all employees work with full
dedication and help company to achieve the goals of the company.
·Shared values- Values are mainly defined by norms and standards which illustrates the
behaviour of employees working with the organisation and action taken by company. Ryanair
follows the core value that it values money and efficiency as well as it deals with low price
(Kitsios and Kamariotou, 2021).
VRIO Frameworks
This tool is used by the company to bifurcate their resources into four main components.
In reference to Ryanair, it is mentioned below-
·Valuable- It indulge the resources that add value for consumers. Under this category, Ryanair
has its financial resources as this resource is valuable for the company.

·Rareness- It involves the availability of rare resources. The Ryanair has rare human resources
to which the organisation intends to provide special training in order to train the employees to
compete the market and sustain for a long run (Olson and et. al., 2021).
·Imitable- It is concerned with the affordability to copy the resources. Ryanair has its customer
community as inimitable as it is a difficult task to imitate culture and community dedication.
·Organisation- It involves the fully organised resources. The logistic and distribution services
of company are well organised which makes their services more efficient.
·TASK 3
·P3 Applying Porter's Five Forces model used to analyse the competition within a marketplace
for an organisation
This strategic tool utilised by many organisations with the intention to evaluate the
existing competitive environment. It is used to minimise the risk of losing the existing
competitive edge in which a company stand in the marketplace. In reference to Ryanair, it is
discussed below-
·Threat of new entrants: It is concerned with the convenience of people to make entry in the
market. In reference to Ryanair, this force has low power as aviation industry already consist of
high entry barriers and actually expensive. Purchasing or even leasing of jets is too expensive to
afford. So Ryanair has less burden of new entrants.
·Bargaining ability of suppliers: It is concerned with easiness that assess the suppliers to drive
up the prices on high scale (Ciampi and et. al., 2020). In context to Ryanair, this force has
comparatively high power as due to limited availability of airline manufacturers and they are:
Boeing and Airbus. Ryanair prefer to buy air-planes from Boeing so their bargaining power is
really high due to limited number of airbus suppliers.
·Threat of substitutes: It refers to the concern that how customers are likely to find the
substitute or alternative of company services. In reference to Ryanair, this source has low power
as Ryanair implemented the strategy of displaying the train fare on their websites which help the
passengers to compare and encourage them to use the service of Ryanair air-planes than trains.
·Rivalry among existing competitors: This tool focus on number and strength of competitors
in the market. In reference to Ryanair, this force has high power due to availability of many
airlines at the same route with comparatively low cost. Every competitor strive to fluctuate down

their fares by reducing the facilities provided to onboard passengers (Magerakis and Habib,
2021).
·TASK 4
·P4 Applying a range of concepts, theories and models, analyse strategic planning for given
organisation
Porter's generic strategies
This strategic tool is very effective as it describes the manner in which an organisation
able to sustain and get an competitive advantage in marketplace. Three main strategies has been
framed to apply to all products, enterprise, and service of any size. In reference to Ryanair, it is
discussed below-
·Cost leadership: This strategy mentions the leadership of cost in market. This strategy is
effective in attaining the competitive advantage and driving the sales. Ryanair adopted for low
cost strategy with the intention to seek attention of more passengers towards the offerings. The
strategy of offering low price to customers still provides a reasonable profit to the organisation.
·Differentiation: Through this strategy, companies intends to make unique offerings for
customers different from competitors. In order to go for this strategy, organisations prefer to do
complete research of the market along with needs and demands of the customers as well as
analyse for offerings provided by the competitive organisations and then try to come up with the
unique idea and high quality services. Ryanair can grab the opportunity and make offerings for
the customers which are innovative and unique enough to attract them in comparison to other
organisations competitively present at marketplace (Siltaloppi, Rajala and Hietala, 2021).
·Focus: This strategy focus on two different variants to sustain and attract customers and seek
their focus towards the organisation. First variant is the cost focus in which the company make
effective strategies to attain the cost advantage ion competitive environment. Second variant is
differentiation which concentrate on seeking differentiation in target segment. Ryanair can opt
for this strategy by seeking attention to fare p[rice and for differentiation variant, company
should focus on introducing new innovative services which can give competitive advantage in
market.
Bowman's strategic clock

This is the strategic model which mentions many options in favour of strategic
positioning. It explores about the appropriate position in which a product must be positioned to
attain suitable competitive place in the market. In reference to Ryanair, the strategies are
discussed below-
·Low price and low value added- This strategy focus on keeping the price low in order to
compete with competitive organisations existing in marketplace. Ryanair can adopt for the
strategy and can set low fare price for their services to beat up the competitors (Kitsios and
Kamariotou, 2018).
·Low price- Through this strategy, organisations focused to produce and offer large quantity of
valuable deals to the customers. Low price strategy unable to produce large profit margin due to
low price offering to consumers but release the product or service in bulk helps in generating
high profit to the organisation. Ryanair can establish low price fares to passengers to make it a
effective and attractive deal for customers with the focus of gaining profit by making offerings
to large amount of passengers.
·Hybrid- As name suggests this strategy is the hybridisation/combination of both the above
discussed strategies. The organisation mainly focus on providing low price service to the
customers along with high value added products.
·Differentiation- Differentiation involves the effort of trying their level best in providing high
quality services with average and affordable price in the market. Ryanair can opt for this
strategy by making efforts to produce quality product and also focus on branding to retain loyal
service users.
·Focused differentiation- This strategy is generally opted by the organisation who considered
to be as high brands which provide luxury brands with high prices to their target customers.
Ryanair operates by offering low price so this strategy is not suitable for this organisation. But to
opt this strategy Ryanair will need to make changes in the fare charges plan and modify its
management.
·Risky high margins- This strategy involves the planning to charge high price from the
customers and this strategy is risky and in unsuitable to sustain for long time in the market.
Ryanair, if suppose to adopt the strategy they has to change their fare price plans from low to
high for the quality service they have been providing but it may be risky for the organisation
(Ali and Anwar, 2021).