Value Chain Analysis: Ryanair

Table of Content

No. Contents Page Executive summary 1

1.0

1.2

1.3

1.4

1.5

1.6 Ryanair and Porter’s Five Force

Competitive Rivalry

Threat of New Entrants

Bargaining Power of Customers

Bargaining Power of Suppliers

Ryanair and its Strategy 1

2

2

3

3

4

2.0

2.1

2.2

2.3 Resource-Based View

Value Chain Analysis of Ryanair

SWOT Analysis

Strength – Ryanair Success 5

6

7

3.0

3.1

3.2 Institution –Based View

Formal Institution [Opportunity and Threat]

Informal Institution [Opportunity and Threat] 8

8

8

4.0

4.1

4.2

4.3 Institution Based View, Resource Based View and Industry Based View (Free Flights in Perpetuity)

Industry Based View

Resource Based View

Institution Based View 9

9

9

9

9

5.0

5.1 Is

Calder (2003) .The automated booking system of Ryanair allows customers to reserve, book and check in on their own, pushing aside the requirement of hiring too many staffs. The company is also avoiding additional expenses by not offering on-board meals and entertainment unless passengers pay more. Outbound logistics in Ryanair on the other hand does not follow the traditional way of using agencies and rely on other company websites for ticket sales. Ryanair uses their own company’s website as a direct marketing approach where the company can sell tickets at low prices as there are no commissions to be paid to travel agents. Also, emphasis is given to short turnaround times (TAT) because this will bring down costs as planes are in the air most of the

As mentioned, keeping the airplane in the air most of the time helps the company maintain its low cost model. It is also a benefit for the customers as their time spent in waiting for the flights will be reduced tremendously. Ryanair has support services too such as aircraft and baggage handling services. Third parties are used as they are more experienced and have better resources in order to reduce time wastage. Ryanair is aware that they can’t be the jack of all trades and this approach enables the company to provide low cost services to its customers. Apart from that, to ensure a high quality service to its customers, Ryanair has all their staffs well trained and experienced before handling their jobs.

2.2 SWOT Analysis.

SWOT analysis is a simple framework to generate strategic alternative from a situation and it is applicable for corporate level, business unit and also in marketing plan. The term SWOT stands for Strengths, Weaknesses, Opportunities and also Threats. The current factor that encourages the current performance of the organization is pointed to strength in SWOT analysis.

Weaknesses refers to the factors that brings disadvantage to significant additional cost in the organization. Opportunity is the chances given to the organization to improve their performance and also sustainability that helps a team to be more competitive. Occurrence of risk can be