Adesuyi , Ibukunoluwa(@00284075)Agbelusi, Oluwafisayo

Tola(@00299101)Ibiloye, Omotoke Seyi(@00289980)

Ogunbor, Osarobo Naomi(@00291067)Orija, Oluwabusola(@00295120)

Uchealor, Bill-Anthony(@00284390)

Business environment of Ryanair Pest Analysis Porter’s five forces Strategic group analysis Value chain analysis Resource based view Leadership style of Michael O'Leary Conclusion and recommendations

PEST

PORTER’S FIVE FORCES

PORTER’S FIVE FORCES

STRATEGIC GROUP

Political factors Deregulation as the market increases in size, therefore economies of scale may

arise. Expansion of EU

Economic factors

Recession September 11 crisis

Social factors

Changing consumer demographics Technological factors

Fluctuating consumer preferences increase in economies of scale in production due to expanding market size

E-commerce method of selling tickets, therefore less infrastructure required, overhead savings

Threat of New EntrantsMEDIUM

•High capital investment•Barriers of entry

•Threat of existing firms

Threat of Substitute ProductsMEDIUM

•Main: Land, rail and water•Indirect: video conferencing

Buyers’ Bargaining PowerHIGH

•Low switching cost•Price sensitivity•Low loyalty

Suppliers’ Bargaining PowerMEDUIM

•Switching cost

Industry Competitors

Rivalry Among Existing FirmsHIGH

•High degree of competition

Strategic Group Map of Ryanair: Easyjet, Aer Lingus and Ryanair are in the same strategic group and so compete closely.

The Critical Success Factors (CSFs) of Ryanair are as follows:

The strategic focus of having the lowest prices. Being reliable in the industry for punctuality. Service and frequency.

Infrastr.HRMTech. Dev.Proc.

Margin

Mar

gin

Minimum Corporate HQ

Low Cost Training

Internet

Boeing Discount

Quality Training

Low Cost Suppliers

Airport Agreements

No Frills

Low Cost*

Quick Turnaround

time

Reliable Service

Low Cost Promotions

Free Publicity

Controversial

Internet Sales

Yield Management

Limited Resources

Basic/Low Cost

High Productivity

Inbound

Logistics

Operations Outbound

Logistics

Marketing

& Sales

Service

Limited Crew

Internet Information

Alliances

Management Control

Integrated Systems

Outsourced

In-houseLow Tech Marketing

Internet Sales

Performance Contracts

Low Cost

THRESHOLD RESOURCES•Website•Operations denominated in Euro•Offices, facilities, appropriate personnel, suppliers and customers

UNIQUE RESOURCES•Brand name(Ryanair)•Management team(Micheal O’leary)•Number one low budget airline•Boeing airplanes

THRESHOLD COMPETENCES•Outsourcing of major services•Online booking•Operation of on-time delivery•Point to point routing

UNIQUE COMPETENCES•No frills strategy•Reduced turn-around time•Low cost•Route policy strategy

Autocratic style of leadership

Determining strategic direction.

Effectively managing the firm’s resource portfolio.

Exploiting and maintaining core competences.

Developing human and social capital.

Sustaining effective organisational culture.

Improve customers perception of Ryanair Improve its oil hedging and currency trading practice. Expand into Eastern Europe and North Africa countries. Succession planning. Continue its market penetration plans especially their strategic

alliance with Aer Lingus. By applying the above recommendations, Ryanair will

definitely maintain its leadership position in the budget airline industry.

http://www.youtube.com/watch?v=g3so6AJe4UQ