Ryanair Case Study Strategy Management(1) 5d4y4o

Contents 1. Introduction..................................................................................................................................... 1 2. Strategic position analyses............................................................................................................ 1 2.1 Environment analysis ................................................................................................................. 1 2.1.1

PESTEL analysis .............................................................................................................. 1

2.1.2

Porter’s five forces framework ........................................................................................ 3

2.2 Strategic capability analysis ...................................................................................................... 4 2.2.1

Cost efficiency .................................................................................................................. 4

2.2.2

SWOT analysis .................................................................................................................. 5

3. Strategic choices of Ryanair .......................................................................................................... 6 3.1 Business level strategy .............................................................................................................. 6 3.1.1

Strategy clock ................................................................................................................... 6

3.1.2

A competitive advantage over years ............................................................................... 7

3.2 Corporate level strategy ............................................................................................................. 8 4. Strategy evaluations ....................................................................................................................... 9 4.1 Suitability ..................................................................................................................................... 9 4.2 Feasibility .................................................................................................................................. 10 5. Conclusion .................................................................................................................................... 10 References .......................................................................................................................................... 11

1. Introduction The jungle of business in the airline industry has been reinforced by the introduction of an innovative idea—the no-frills carriers, which is becoming customers’ new favourite. Mintel (2008) noticed those budget airlines have among the chief drivers of intra-European travel growth these years. Among low cost airlines, Ryanair, the largest budget airline in Europe (Evans, Campbell, & Stonehouse, 2003, p.375), is one of the most successful cases. Since its first take-off in 1985, Ryanair has experienced numbers of strategic modification according to both its environment and own capability changes, up till nowadays the company’s full flight. This essay is divided into two parts: the first half will examine Ryanair’s environment and strategic capability, and the second half will identify the strategies Ryanair has chosen with regards of the analyses done previously. The focus is mainly on the period between 2006 and today and some crucial moments for Ryanair are also mentioned. 2. Strategic position analyses In Part 2 of this essay, analytical tools are used to analyse the environment and capability of Ryanair. In the first half, the macro and immediate environment are identified through PESTEL and Porter’s framework analyses; in the second half, cost efficiency direction and a SWOT analysis are given to find out Ryanair’s organisation capability. 2.1 Environment analysis 2.1.1 PESTEL analysis Finlay (2000) sees the “remote environment” as crucial to business that it is “a model of those elements in the environment” that may affect the business’s decision making but it is beyond the influence of the business. As to the macro-environment of the company, a PESTEL framework is utilised to list the influences from the outside. Johnson et al. (2008, p.55) has quoted that the framework consists of six main elements, namely Political, Economic, Social, Technological, Environmental and Legal. Among those factors this budget airline is more likely to be influenced by some “key drivers” (Johnson, Scholes, & Whittington, 2008, p.56). For Ryanair, such environmental factors have a higher impact on the strategy the organisation made, such as the government regulations, environmental concerns, and as the low cost is the key success secret of Ryanair, the company is also vulnerable to the fuel price changes. Figuring out the fact that the no-frills had been stuck in “soaring fuel cost” and “impending EU Emissions measures” embarrassment, Mintel (2007) questioned whether they should keep prices low. Political Political issues are concerned with the role of government, and this factor is one of the key drivers Ryanair should take into consideration. The British increasing air enger duty for short-haul flights and similar tax in Ireland is predicted to cause the enger numbers fall (BBC, 2009). The air enger duty, set to rise in November 2009 and 2010 respectively, has become another main concern of Ryanair (Mintel, 2009). Also the ever rocketing airport charges worsen the situation for Ryanair. 2005’s new EU regulation of enger compensations for delays, cancellations is also expected to bring Ryanair a huge spending annually. Box and Byus (2005) mentioned that as a non-union operation company based in Dublin, the trade union pressure from the local government was rather big

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The company has to cut prices to attract more engers, at the same time higher costs trim its profit from 2008, especially since the recession period. Ryanair has been continuously calling on government to make sensible reduction in duty levied on airline including tourist taxes (BBC, 2009). Security concerns have jumped to the top agenda of government since September 11th, 2001 attack. The strict and complex check-in process is the other way around with Ryanair’s quick check-in strategy, aiming to lower costs. Economic Economic factors are also among the key drivers for Ryanair. Being one low cost airline, the vulnerability to cost factors like fuel prices, exchange rates puts Ryanair faced with various economic challenges when making strategies. As shown in the case (O’Higgins, 2008), Ryanair’s fuel costs “represented 35 percent of operating costs in 2006”, while the company promised not to the fuel surcharges onto engers, the pressure of cost savings has to be shoulder by other spheres of operation within the organisation. The firm said in BBC news that high fuel prices had been a “drag on profitability” (BBC, 2006). In addition, the turbulence and instability of fuel prices has been a headache since early. During the year of 2008 and 2009, Ryanair has engaged in the hedging, however, the Botching use of this strategy is said to cause £92 million in the last quarter of 2008 (Robertson, 2009). Moreover, the fact that the denomination of oil price is in US dollars, exchange rate fluctuations, especially during the depreciation period of UK Sterling in 2009 and 2010, will no doubt compound the risk for Ryanair. Mintel (2009) statistics shows the third quarter of 2008 witnessed the hit of recession of budget airline. It seems that Ryanair has tried to find way to cut staff costs. I have noticed websites its staffs build to complain about the poor working environment and low average pay. Social As to the Social factors, the increasing travel lifestyle and international student trips are two main ones. Mintel (2010) finds out the short break abroad has been a trend for UK people. Ryanair has provided those with tight budget with opportunities to flight abroad, and its low prices and varied destinations across Europe have made itself a preferred choice for international students, and even home country students also like to choose it for backpack trips. The foreign property ownership trend will also help the increasing traffic. Illustratively, a research shows about 800,000 UK households have a second home abroad in 2006, achieving an increase of 45% compared to June 2004 (Kirby, 2006). However, the recession also effects people’s travel lifestyle: Mintel also finds fewer trips was taken in 2009 than previous years, while about three quarters (71%) claim to cut down spending, Ryanair had planned to ground numbers of its aircraft in early 2009 due to enger number fall and fuel prices (Bond, 2008). Technological Ryanair has also never ceased to technologically improve the efficiency to cut cost. It calls itself “Europe’s greenest airline” and as shown on Ryanair official website, their efforts of fuel emissions, noise, and waste reduction have resulted in a leading status comparing with other major airline firms. Ryanair’s 100% online service is a good way to cut cost, and a free online check-in system launched in 2006 is encouraged to save check-in time. Environmental

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The Environmental factors for Ryanair are concerned with noise, and pollution controls, and energy consumption controls. It is stated in the case (O’Higgins, 2008) that aviation represents 2.6 per cent of greenhouse gases emissions in the EU in 2006. With more environmentally-friendly aircraft developed and introduced with less emission and more efficiency, Ryanair has tried to achieve beyond the general regulations of EU. It claims to reduce the fuel burn per 100 revenue enger kilometres (PRKs) year by year as shown in Figure 1, resulting in less CO2 emissions by 4%. For the airline industry, the force majeure is another unexpected risk that may cause great losses, just like the 2010 volcano ash cancelation around North European countries. Figure 1 (Source: Ryanair official website)

*Includes the adverse effect of a temporary use of inefficient aircraft acquired from Buzz. ** Estimate Legal The last factors are legal ones. Two main issues are Ryanair’s misleading advertising controversy and the flight security issues concerning pilots flying hours. One 2008 CNN news said the firm had been found guilty of transgressions over two years’ period. For security concerns, EU has restrictions on pilot flying hours to prevent dangerous fatigue. Ryanair does business on point to point flights with quick turnaround; it has to ceiling this hour limit for its pilots to achieve efficiency (Weston, 2002). 2.1.2 Porter’s five forces framework The impact of the firm’s immediate environment of the surrounding competition is of great importance for strategy making, and cannot be ignored (Johnson, Scholes, & Whittington, 2008, p.60). Porter’s five forces is utilised to evaluate the total attractiveness of Ryanair’s industry, i.e. the low cost airline. Barriers to entry the industry are those obstacles the new entrants have to get over to compete successfully. The budget airline industry requires a solid financing back and experience is a plus for success. Also, the economies of scale are a barrier, as the low fares and high efficiency operation 3

with airplanes of the same model in use in Ryanair. The awareness and acknowledgement among consumers of Ryanair is another barrier, which drives access to supply or distribution channels hard to reach, and makes differentiation difficulty to provide. Recent years there are new entrants like bmibaby, Jet2 in the UK, and Goodjet, Hallas jet in other western European countries has tried to explore in this field. The Stellar growth in this sector has attracted over 60 no-frills competitors in the arena (Jobber, 2007). Substitutes still cannot form a huge threat for Ryanair, with the advantage of shorter travel time, especially for those trips like overseas and cross-channel. However, the threat of substitutes of other transport methods becomes obvious after the economic condition goes bad. Mintel’s research has shown the threats of rail to budget airline, since the consumers of Ryanair are chasing the low price, if there is option of a better offer, the loyalty does not exist any longer. Watching the money value going down, some people tend to choose other activities instead of travel. The buyers of Ryanair are mostly value hunting engers. Those individuals do not have a strong buyer power because they don’t purchase a huge volume. The firm continues to “encourage engers to switch from high fares” carriers (BBC, 2010). The suppliers of Ryanair are technology group and most important, the oil dealer, and airports. As discussed previously the firm is subject to fuel price changes, and airport charges. The power of those two is quite strong, while the oil suppliers are concentrated suppliers; there is high switching cost for airports. That’s why Ryanair select its airports carefully to earn more engers with lowest costs. Although in recent years the biggest rivalry for Ryanair in this sector is easyjet, with high growth rate in no-frills airline and the company’s image, the leading position of Ryanair is hard to change currently. Jobber (2007) has pointed out easyjet increasingly uses shadowing and undercutting the major carriers compared to Ryanair’s point-to-point flights between secondary airports. 2.2 Strategic capability analysis We can notice in Europe, even in the UK, there are numbers of firms operating as budget airline, sharing an identical external environment, yet Ryanair is a superior performer. Johnson et al. (2008) highlights the strategic capabilities one company owns—they are different and hard to copy or obtain by another. 2.2.1 Cost efficiency The statement by Johnson et al. (2008) that a good management of costs is a key strategic capability can prove itself true in Ryanair’s case. The company’s attention has been paid to those four key cost drivers directly or indirectly: economies of scale, supply costs, product/process design, and experience. When a high volume of output can be achieved to cover the capital input, an effect of economies of scale can be quoted to achieve cost efficiency (Johnson, Scholes, & Whittington, 2008). The identical aircraft type can reduce the cost of pilot training and on board staff, as well as maintenance and reparation. Hooley et al. (2007, p.45) has also mentioned the firm’s “more people fly more often”: through selected routes with expected traffic growth. When the routes are of limited number, increased flight volume can bring cost efficiency. Aircraft manufacturers and airports are two major suppliers of Ryanair. The firm chooses Boeing other than like Airbus is out of it capability for cost cutting. The airports selection is quite similar— secondary airports are another source to achieve lower cost than its rivals. Ryanair makes good use of process design. Capacity-fill management is crucial for airline for unfilled seats cannot be “stocked” for subsequent sale (Johnson, Scholes, & Whittington, 2008), Ryanair does not offer unchanged prices, it set special offers and has its online booking system to decide the offer time and volume to achieve maximum the enger seated number. 4

Experience is also a key factor of Ryanair’s capability after over 20 years operating in this industry. In the Europe it has the first-mover advantage, and has gained a reputation. In addition, Ryanair has realised the situation in the experience curve, as unit cost efficiency (fuel burn per unit stated in Figure 1) improvement continues year by year. 2.2.2 SWOT analysis SWOT analysis provides a link between the important factors from the business environment and the organisation’s capability that is to influence the strategy development (Johnson, Scholes, & Whittington, 2008, p.119). By listing the opportunities and threats in Ryanair’s business environment, the analysis aims to indentify the strengths and weakness relevant to its capability to deal with those changes in the environment. Strengths and Weakness A well-known brand image of low prices established is a greatest advantage for the company. Ryanair’s operation for over 20 years in Europe as a first mover actually increases the entry barriers, thanks to experience and its reputation. Ryanair’s latest annual report shows 8% traffic growth with 16% revenue increase compared with 2009. The Continuous improvement to the aircraft fleets enhances the fuel efficiency and on the other hand the same Boeing 737-800 model can reduce training and maintenance costs. Ryanair’s overall online service simplifies the booking and check-in process, saving staff numbers. New fuel hedging strategy tries to minimize the risk of price changes. Ancillary income brings big revenue for the company. However, constantly changing business environment factors like fuel prices, exchange rates have become a major threat to low-cost strategy. The bad image of work environment and pay rates, nonunion can affect the business in the long run. Various new taxes and duties throw another burden for Ryanair to find out new technological methods to achieve innovation for low cost. Opportunities When Ryanair tries hard to develop new routes, the new -in EU provide good opportunities for the company. If as planned, Ryanair’s new long-haul market expansion will bring in more revenues. Ryanair also “spies opportunities as airports suffer”, stated Pilling (2009). According to the firm’s official website news of February 2009, Ryanair’s traffic grew by 13% as “more consumers switch to Ryanair’s low fares from high competitors”. The shrinking pockets of people during recession bring good news to Ryanair. The firm’s CEO Michael O’Leary announced that “the dramatic cuts in flights and capacity” by lots of carriers caused decreasing traffic at many of Europe’s major airports. These airports reduce charges to earn more businesses, which create a distinct opportunity for Ryanair, whose quick turnarounds and check-in facilities are quite welcomed. However, Papatheodorou (2008) mentions that these low cost carriers (LCC) “seem to be built both for economic recession and recovery” in that people turn to low price airlines in recession, while LCC “meet the increased travel demand for leisure purposes”, especially short-haul routes. The fuel efficiency and less emission environmental-friendly model will be a new trend in airline industry. Efficiency and effectiveness seeking scheme of Ryanair have enabled the firm steps ahead of the industry. With growing number of engers gradually accepted the concept, the popularity of Ryanair will continue to rise over years. Threats As detailed discussion of environment in previous PESTEL and Porter’s five forces analysis, there are some key threats Ryanair is facing.

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The price of fuel has always been within the upmost consideration. Keeping cutting fares compounds the pressure to make a profit; as a result the company must try even harder to find a way out. Also, new entrants want to get a share of the big cake of budget airline industry, putting new pressure to the company. The traditional airline giants like BA, Air has responded by slashing prices on many European flights to compete with added values like free food and drinks (Jobber, 2007). These reactions are no doubt great challenges for Ryanair. 3. Strategic choices of Ryanair Founded in 1985, operating for over 20 years, the moment Ryanair made the strategic decision to transform itself into the low cost airline (combined with the introduction of other companies alike) is a historic one, which Shaw (2008) sees it as change of the marketing in the sector “at a stroke”, of which “it is almost impossible to exaggerate the significance”. If the initiation of Ryanair’s low cost strategy is the wisdom of discernment to seek the opportunity, the strategic choices during the period to boost its acceptability and popularity are to react to its strategic position as discussed above. Part 3 of this essay will identify those strategic choices with reference to different levels of the company's overall strategies: business level and corporate level strategy will be examined respectively. 3.1 Business level strategy On business level, a fundamental strategic choice must be made as to which competitive strategy the company should adopt to gain competitive advantage in the market. The competitive strategy of an organisation focuses on the bases on which the business can achieve its competitive advantage in the market (Johnson, Scholes, & Whittington, 2008). 3.1.1 Strategy clock Deciding top of the majority of customers’’ needs are “bargain fare”, Ryanair offers “only a very basic product” to match its cost and capability (Shaw, 2008)—this strategy is best described by Cliff Bowman and Richard D’Aveni’s “No-frills” route in the “market facing” strategy clock, shown in Figure 2. The strategy clock divided the positioning of organisations into different types in a market where consumers are seeking varied value for money. “No-frills” is primarily concerned with the low price and a low perceived product/sevice benefit, which means the consumers here are bargain chasers, the target audience of Ryanair. Johnson et al. (2008) have stated basis on which the no frills strategy market segment can survive, and some of those can apply to Ryanair’s case: the existence of price-sensitive customers and low switching costs between transport options. Those bargain seekers include those who cannot afford high prices, or decide not to choose a higher price, better quality service. These situations can explain the main body of Ryanair’s engers. Many people are not willing to pay hundreds of Pounds (or Euros) for a short-haul flight of only one or two hours far. O’Connell et al. (2005) survey shows the importance of fare with respect to carrier choosing: “the fare constituted the principle reason for choosing a low cost carrier. Nearly 90% of Ryanair engers saw fare as the sole factor drove them to choose the airline. Buyers’ low switching costs means they can choose as they like from numerous budget airlines. As a result, top of Ryanair’s stated “enger fares, punctuality and service commitment” is to “offer the lowest fares at all time on all routes”. The company promises to repaid the enger’s double fare if any competitors offer a lower price at the same time same route. The company will immediately lower the fare if they know someone else’ special offer is better; to make sure Ryanair’s fare is the lowest within the industry. Being aware of the underlying customer lose due to low 6

switching costs, to carry on the no-frills strategy, Ryanair’s choice is smart and somewhat the only one to offer the lowest fare, and keep cost low at the same time. Figure 2: Ryanair position in strategy clock

3.1.2 A competitive advantage over years Among those low cost airlines, Ryanair is an older-established one (Shaw, 2008). Statistics from European Low Fares Airline Association (ELFAA) shows in nowadays intra-European flights budget airlines for over 35% of scheduled traffic, and the organisation’s 2010 latest figure proclaim Ryanair’s crown over the major no-frills airlines in enger numbers, occupying 28.67% (Figure 3) with closest competitor easyJet 22.1%. Ryanair’s competitive advantage sustainability is to some extent incredible. Figure 3: enger Numbers Source: ELFAA * Statistics-January 2010

Ryanair, 28.67%

ALL ELFAA , 71.33%

*Current airline hip: Blue Air, easyJet, flybe, Jet2.com, Norwegian Air Shuttle, Ryanair, Sverige Flyg, Transavia.com, Vueling, Wizz Air. To maintain a firm’s competitive advantage is of uppermost expectation of the managers. In order to sustain priced-based advantage, Ryanair adopts three types of strategies mainly: 7



Low margins with high sales volume

The high oil price and fares cutting squeeze the net margin per seat. Ryanair’s fleet comprises 202 Boeing 737-800 with capacity of 189, of which the density of enger seats help increase the enger quantity, and therefore with a high percentage of full booked flights the company can achieve an overall high net profit. According to ELFAA (2010), Ryanair’s daily flights are 1070, the top of those major competitors. 

Low cost structure

Ryanair’s 2011 Quarter 1 report revealed that even fuel costs rose by 34%, the costs excluding fuel rose only by 1%-- the cost reductions are across the whole organisation. The streamline operation through complete online business, small staff numbers, and energy saving measures achieves a low cost business structure. It is shown in Ryanair’s website that in the year 2007, the organisation has managed to “deliver industry leading productivity…with almost 10,000 engers per employee”, a ten times better results than major competitors then. 

Special capability that competitors are unlikely to imitate

If the low fare is not hard to copy, the special capability of lowest fare with highest margin is almost impossible to imitate for competitors. The firm’s 2006 free flights campaign is beyond the reach of other airlines. The continuous “no fuel surcharges”, no.1 for punctuality, least mislaid bag accidents are even more difficult to achieve within a limited spending. We should notice that while Ryanair makes efforts to hold on its advantage in a defensive position, it also attack to approach the strategic lock-in position. It calls on the whole industry to deliver to engers “what they really need”, the core product, “the real commitments on pricing, on punctuality and on key services”. It even calls on government to change duty and taxation. 2008 witnesses the victory of Ryanair’s 2001 base agreement in Charleroi with the EU Commissions 2004 dismissed. And it works for flight giants begin to cut prices to compete, or to go with the tide. 3.2 Corporate level strategy Above the level of business units, decisions concerning the corporate level are more crucial to the organisation. Those key strategies are the concern of the corporate parent, which refers to the management above the business units and without direct interaction with customers and competitors (Johnson, Scholes, & Whittington, 2008). Although Ryanair’s strategy is quite focus without a trace of “diversification” in the definition, the corporate parent has shown what Johnson et al. (2008) call “parenting advantage” in the following ways it adds value. 

Clear internal mission and external image

As the corporate parent, its strategic intent for business unit is quite simple and clear—efficiency. The company reward the employees for their effort as their statement goes “the more you do the more you get paid”. It educates the staffs that it offers low fares, and efficient service. The company delivers a belief of a shared revolutionary, big mission it is doing business in; in spite of those barriers from big and strong competitors, airports, and even rule makers, they will continue to engage themselves in changing the airline industry of Europe to get rid of High Fares. Another aspect of efficiency is to cut cost from every possible area of operation. News reveals that Ryanair forbids its staff charging mobile phone in workplace to reduce power expenditure. To its stakeholders Ryanair also provide a clear external image. The lowest fare across Europe and no fuel surcharge guarantee are the main message delivered to its engers. It offers what the engers really need and help them make best value of their money. Ryanair also describes itself as the greenest airline with fuel saving measures and low waste, noise emissions.

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

Long-haul planning

Over years’ successful operation, Ryanair has experienced rapid expansion across Europe. Early in 2007, the firm’s CEO Michael O’Leary has announced Ryanair’s plan of new long-haul airline to the United States. Operating as a separate branding from Ryanair, the new business unit will offer both low fares and a first class competing with giants. Although in 2010, O’Leary stated the postpone decision of this plan, however, if the facilities, mainly the aircrafts are ready for use, the plan may be put into effect immediately. 

Acquisition

In order to maintain its competitive advantage for long, Ryanair has been trying to make its self stronger by take ownership of another company, more often its competitors. The successful acquisition of Buzz in 2003 helped Ryanair to gain “immediate access to 11 new French regional airports”, and also made Ryanair the largest airline at London Stansted Airport, according to Ryanair’s website. This acquisition is a good example of synergy management of the corporate parent. In the year 2006 and 2008, Ryanair has tried to bid twice for Aer Lingus. But the takeover planning was rejected by the Irish government. Now Ryanair owns 25% of Aer Lingus’s share. 4. Strategy evaluations Strategy evaluation is important to the organisation. Strategies should be evaluated in of criteria to explore why certain strategies might perform better than other choices. For one organisation there is great number of potential alternatives to choose from, so proper evaluation can help it select the best possible fit strategy to develop. Additionally, the periodical evaluation can identify the strategic position changes and the organisation’s capability, and is very useful to make strategy modifications. In the following part, deepened evaluations will be given as follows to analyse and examine the current strategies of Ryanair with regards to the criteria of suitability and feasibility. 4.1 Suitability If a strategy addresses the key issues that have been figured out by the strategic position analyses of the organisation, the current strategy goes with the suitability criterion. According to Part 2 of this essay, tools like PESTEL, SWOT, and five forces have been used to identify the environment of Ryanair. Among massive issues to consider, Ryanair has smartly and precisely discerned the key issues, and the current “lowest fare, cost efficient” strategy is response to the top ranking drivers of the environment. In the airline industry, key factors should be fuel price, duty and charges, customer number (flight capacity and full percentage), and route choosing. Before 2006 Ryanair’s first step into the no-frills arena is a strategy decision milestone. Compared with the year 2006 refusal of hedging, in the year 2008 the firm began to try hedging to diminish the oil price risk even if the lack of experience has made some wrong decision. The flight choosing is suitable. In 2005 the 737-200 with maximum capacity of 130 all retired, instead the current fleet with larger capacity and lower energy consuming (airliners.net data). The lowest fare promise is the key strategy to attract engers and boost full flights percentage, and meanwhile defend the competitive advantage and raise the entrant barriers of the arena. Ryanair’s leading position in fierce competition should also give thanks to its homework done in route choosing. ELFAA statistics shows the almost unbeatable coverage with 150 destinations and `1000 routes in operation. The firm’s consolidation and expansion go hand in hand, which is quite suitable to the forces in the environment.

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4.2 Feasibility Feasibility is to question whether the organisation has the capability to put the strategy into effect. Ryanair’s financial feasibility can include the strategy of airline purchase in batches and the employment of minor airports according to its expansion and capability. The selection and purchase volume of aircraft involves many about operation analysis and business forecasting. One strategy that Ryanair has chosen to minimize the operation costs is to make complexity simple. Papatheodorou (2008) has detailed what the firm does—operates “a system of multiple quasi-hubs”, and its only point-to-point services with no interline connection services. Johnson et al. (2008) emphasize the importance of resource deployment of the organisation. The organisation’s ability to identify the resources and competences that are useful to put the strategy into operation is crucial. The simplified operation processes, which are quite feasible for short-haul operation, provide Ryanair the quick reaction ability to the external changes such as political ones. The company chases the opportunity of deregulation which helped boom the development of the no-frills strategy. Furthermore, the enhanced market liberalisation like EU-North Africa, and the new accession of potential routes, especially of new -in EU countries have been made good use by Ryanair to explore its new market. Facts confirm the firm is always prepared to take advantages of those opportunities, fast and effectively. News on www.anna.aero announced ryanair’s opening of over 50 new routes in the 2010 Easter week, with its services available at 142 airports across Europe and North Africa. Notably, Ryanair’s new routes occupied over half of those of world’s airlines that week (anna.aero, 2010). We can notice that every change and new purchase Ryanair has taken are quite feasible in of it scale and resources—those decision must be under careful considerations. 5. Conclusion There is no invincible general in the battle of business. Being among the first mover in the European budget airline arena, Ryanair have managed to reign over the field for many years. The essay tries to find out why the organisation can do so. In the first half, analyses as to the company’s strategic position and its capability are given to figure out the key factors that influence the strategic management. The political, economic factors and pressure from competitors give birth to Ryanair’s cost efficiency and low fare business strategies. In the second half, detailed exploration of Ryanair’s practical measures to deal with the external pressures and develop itself has found out the secret of the organisation’s success. The simplified and efficient operation process can both react to the changing environment and minimise its own costs. There are new strategy orientations of Ryanair, for example the long-haul planning. Whether the company can carry on the lowest fares and continues its profitability, maintain its leading position in the future, we can wait and see.

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http://www.ryanair.com/en/news/ryanair-beats-recession-as-traffic-grows-13-percent Accessed 25th July 2010. 27. Ryanair website (2010). Ryanair’s Lowest Fares and enger Service Charter. http://www.ryanair.com/en/about/enger-charter Accessed 29th July 2010. 28. Shaw, S., 2008. Aviation Marketing and the Leisure Market. In A. Graham, A. Papatheodorou, & P. Forsyth, editors, Aviation and tourism: implications for leisure travel. Hampshire, England: Ashgate Publishing Limited. 29. Weston. C, 2002. Ryanair pilot 'forced to fly' beyond legal limit. http://www.independent.ie/national-news/ryanair-pilot-forced-to-fly-beyond-legal-limit297083.html Accessed 25th July 2010. Websites www.airliners.net www.elfaa.com

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