The aims and nature of ryanair

The aims and nature of ryanairThe aims of this subject ara atomic number 18 to analyse and let off the nature of Ryanair strain organization enterprise arrangement, describe the contribution of functional areas to the operation of Ryanair governing and to demonstrate an understanding of core concepts in functional areas. The objective of this report is to show understanding in placements key areas such(prenominal) as organisational type, m matchlesstary information, marketing management, theatrical role and fork out twine.The Ryanair dimensions second-largest airway in Europe in terms of passenger numbers came to the passeliness world in July 1985 with flights on a 15-seater Bandeirante aircraft. It was operating daily from Ireland to London Gatwick airport. Quantity of passengers was just just about 5,000 thousands. In 2009 quantity of passengers increased by 66,503,999 meg. Ryanairs fleet rose to 232 Boeing 737-800. During 1985-2009 Ryanair has exposed bases in the centre and north side of Europe. Low terms airline wage rose 200% to everyplace 318 million euro while many of Ryanairs competitors hail losses and level more go bankrupt (Ryanair 2009). Ryanairs future activities leave behind be considered in below presented articles.2.0. FindingsFigure 1. Ryanair Holdings Logo (Ryanair 2010)2.1. brass sectional StructureBonderman and OLeary (1996) found a new order Ryanair Holdings, they have bought the control of Ryanair guild and for 5 million cash, an airline they had encouraged at approximately 57 million. From that moment Michael OLeary is Ryanair Holdings legal entity (Creaton 2007117).2.1.1. Sector in which Ryanair TradeAccording to Palmer et al., Ryanair operates in private-sector, because the aim of private-sector organisations is to earn internets for the avouchers of the organisation. As OLeary is entity of Ryanair, healways playacting in the interests of the ac smart set because he is a parcelholder (Siobhan Crea ton 2007278).Moreover, OLeary said that he get out earn as much remuneration as he outhouses (Siobhan Creaton 2007277). In addition, private-sector is able to monitor the results of its marketing activity, as the benefits are normally internal to the organisation (Palmer and Hartley 2006230). Ryanair publish their annual report which willing be used in this report as an example of sources of finance (Ryanair Holdings 2010). esoteric sector is subdivided into four types, but Ryanair refers to devil of them Private Limited Company (LTD) and Public Limited Company. LTD permits some defence to the shareholders they nominate a take a chance to invest m stary for bank line. Thus, shareholders underside use Ryanairs annual report (Ryanair Holding 2010) which includes detailed financial information (Boddy 2002488). PLC moldiness have a nominal share capital of 50,000 and must have at least two directors. As to Ryanair, OLeary and Bonderman have bought control over Ryanair Limite d for 5 million (Palmer et al. 2006220). Consequently, Ryanair Holdings PLC (Ryanair Holdings) is the holding company for Ryanair Limited (Ryanair).2.1.2. Structural StyleRyanairs structural dah is divisional, where administrators create divisions and make them responsible for all the functions to deliver their facilities to the consumers (Boddy 2002245). Ryanair Company has geographical divisions, to the location of clients. For example, Ryanair has a group of people who works in Baltic countries, such as Latvia and Lithuania and there are managers, who are responsible for staff, customer necessarily, and manager use autonomy to meet local unavoidably (Boddy 2002246).2.2. Ryanairs extension of FinanceRyanairs company is financed by internal sources sources of finance that come from the patronage activities retained profit. For example, if the Ryanair business had a successful trading year, the organisation can use got profit for future activities. Of course, Ryanair can use profit alone after move overing all its costs (Manak 2009184-185). The advantage is that source is truly useful for long term business, because they can use it sources for future business activities. For example, Ryanairs attendants sell a variety of products such as MP3 players, digital cameras, perfumes and so on. All the extras revenues are up to 15% of all revenues. Ryanair Company is hard to earn revenue on everything on the board provided lay (Kotler et al. 2009577).Furthermore, Ryanair is mellow by equity finance. That means that organisation or a person providing funds, does non receive interest and there is no guaranty that it will be repaid. If organisation had a success in borrowing money there will be an increase in share value or in dividends. Besides, after borrowing success, shares could be exchange to some on else. (Smith 2007291). There are different types of shares familiar shares and option shares. Ryanairs organisation has ordinary shares. Sharehol ders receive ownership of a small map of a business and they carry fatten up voting rights. The number of ordinary shares that Ryanair has is 1,476.4 (in Ms) (Ryanair Holdings 2010138). Correspondingly, companys earnings per ordinary shares are 20.68 (euro cent). However, if organisation will have unsuccessfulness, shareholders will be last people who will receive proceeds and whitethorn be receive nothing at all. (Smith 2007292).2.2.1. Profit or breathing out?Being based on Ryanairs Income statement for year 2010 company got the profit of 341million forwards tax and 305.3 million after tax (RH 2010135). Thanks to glower oil prices, companys traffic increased to 14% of customers. Ryanairs non-ticket revenues rose to 661 million or 11% in 2009 but now (2010) account is 22%. Besides, Ryanair opened 280 new routes in 2009, with destinations such as Spain and Portugal for summer travelers, making high summer rates. Besides, shareholders will receive special dividends up to 550 mil lion euros. Congruently, Ryanairs capitulum executive OLeary will receive 20 million euros, who owns just 4$of the companys shares. (Guardian 2010)2.3. Marketing strategy and Target MarketMarketing strategyinvolves the activities of selecting and describing one or more tush markets (Lamb et al. 200843).To identify target market, an organisation should identify which of the segmentation is distinct and actionable. Ryanairs target is market segmentation activity. Segmenting market relies on detecting the variables that differentiate customers with need (Boddy 2002215). Ryanair organisation refers to demographic segmentation well-disposed class. It can be used characterised function standards such as education, trading and property worth (Kotler 200916). Company select only one target segment to focus on, consequently, organisation use concentrated targeting strategy. The advantage is that business may concentrate on resources and can better meet the needs of defined segment (Lam b et al. 2008247).2.3.1. Marketing MixWhen target market is determine organisation can evaluate marketing mess up. McCartneys four marketing mix tools were expanded to 7Ps by Boden, which had a more dish ups focus and include process, physical evidence and people. 7Ps is a necessary mix that company should lede to maximise marketplace results (Kotler et al. 200917).Ryanair is using 7P Formula for its brand image, which consists of2.4. type dodgeAccording to David Garvin (1981) there are 8 dimensions of spirit that can process as a graphic symbol framework. For Ryanairs Company quality strategy recognition we will use only 4 the most obvious dimensions mathematical operation characteristics of a proceeds (Garvin 198750). For example, Ryanairs improvement speed, flight engagement is depended on your own, because Ryanair is pass only self-service. Another example is absence of postponement, unfortunately, Ryanair not the best in this service, because flights are usually delayed.Perceived quality -it is about clients previous experience, what he withdraws about that company (image, reputation) (Garvin 198759-60). Focussing on core brand value (providing cheap tickets to approximately 49 million passengers who desire low cost to high service) is a key of Ryanairs success. (Kotler et al. 2009443).Aesthetics it is about personal judgment of individual (Garvin 198759). For example, passenger is ordering some food that looks and tastes not as good as at picture was. In addition, sight or vision of service. For example, Air France KLM have an impression of luxury thanks to trounce seating room, while Ryanair has plastic seats with blue and yellow as the predominant colours of no frill focus company (Kotler et al. 2009681).Serviceability how luxuriant client will be served (Garvin 198757). For example, passenger is ordering some repast and he gives denomination but not a coins, it will take an eternity to receive back your change. So Ryanair has very poor serviceability.Relying on above mentioned facts it is possible to tell that Ryanair has not got any strategic quality at all. Ryanairs heading executive is obsessed with providing a functioning airline and cared little about pleasing its passengers, passengers number growth and companys profit (Creaton 2007271).2.4.1. 3 Key Areas of QualityQualityServicePeopleMarketing heights(Service satisfies customers needs)Sales packagingLow(customers are dissatisfied)Food for extra payUncomfortable seatsChecked luggageBus transportation into town.Employees must pay for own security checksStaff must pay for own uniforms and parkingStaff must supply own tea and pissAdvertisingService is an indicator of poor quality, because while you are escape at Ryanair aircraft you will not receive any food for free. For example, the gamy dog for 4 euros (Kotler et al. 2009577). Moreover, it is well known fact, that Ryanairs seats are uncomfortable, seats do not recline and seat-back pockets ha ve been removed (Kotler et al. 2009577). Comparing British Airways (BA) with Ryanair, BA has first business and economy classes seats, while Ryanair has only frugal system class seats (British Airways 2011). Furthermore, client should spent extra money for bus or train transportation into town from distant airports that Ryanair uses (Kotler et al. 2009577).Furthermore, Ryanair has poor quality in HRM. Staff could no longer enjoy their tea or coffee for free, staff must to bring own drinks and snacks to work. Cabin junto were banned to use ovens on board, because there will be no additional cleaning costs. Pilots were told that they can use only one ream of physical composition a day (for reports). They also have to do bi-annual medical examinations, in their own time, and what is the worst they have to pay for their own for it. Additionally, reduction concerns to uniforms, company will deduct monthly sum from staff pay to bury their uniforms. Besides, there is a problem of abse nteeism in Ryanairs company (have lost over 10,000 long time) (Creaton 2007239).Ryanair is famous with rude and scandalous posters. One of the examples is poster which offended BAs company (Creaton 2007239). Comparing Ryanairs posters with BAs we can say that BAs advertising is more enjoyable, because there are no slogans that are concerned with price reduction (see Appendix 1 and 2). The only thing that has a high quality is sales promotion because a quarter of seats are free, passengers pay only taxes and fees of approximately 7 16 euros (Kotler et al. 2009577). In addition, buying a ticket passenger can return their 10 pounds, receiving a coupon (after completing online booking Ryanair offer to complete form).2.5. Sequence of Supply Chain ActivitiesRyanair Company provides deed by airplane services. The table below shows the sequence of supply chain activities.At First, passengers decide to use Ryanairs airline then they have to complete the online form at Ryanair.com, then pa ssengers will receive digital pass along at their e-mails. The following stage is online check-in, which you must to complete from 15 days up to 4 hours prior to passengers scheduled flight departure. Moreover, client must to print check in ticket. ( - ) At day of flight traveller arrives to the airport and registers their luggage and then goes transportation. When passenger arrives in the airport he should undergo the same procedure as well as before flying (registration, luggage).The disadvantage of Ryanairs Supply Chain service output is waiting time. It is the time that customer has to wait before flight. The lower the waiting time, the higher(prenominal) the level of service (Bowersox et al. 201051). For example, Ryanairs flights are often delayed and sometime even cancelled. Consequently, Ryanairs level of service is poor.2.5.1. Value -Added ServicesRyanairs internet booking is the value-added service in Supply Chain process. According to Bowersox (2010) et al. value-added services refer to uncomparable activities that firms can develop to increase their productivity. For example, internet booking is unique activity, and passengers, buying tickets, online can save they time. In addition, online check-in is value added service, because if passenger does not have luggage (more than 15 Kg) he can go satisfying to the gate. Online check-in helps to save passengers time (do not wasting time staying in the registration queue) and companys time and money (staff working hours).The company is in ample demand at consumers despite that consumers are performing self-service, of course except motion by airplane. People are ready to for this kind of services, because they favor low cost rather than high quality or supply chain services. Ryanair is offering close distance only that is why consumers clump low cost ticket, 2 or 4 hours may not cost a high quality.3.0. ConclusionThe main conclusion that can be drawn therefore is that1. Ryanair organisation is tr ading in the human beings sector that gives an advantage for its owners, because private sector helps to earn money for them. Also, Ryanair select divisional structure, because airline has it offices almost in all over Europe.2. Ryanair is run by retained profit and equity finance. Furthermore, company is making profit of 341m before tax.3. Ryanairs target market is demographic segmentation if speak in detail Ryanair company is considering social class for characterising function standards such as education, profession and property worth. Ryanair is using Seven P Formula as a marketing mix for its brand image.4. Quality dimensions speak about that Ryanair business organisation has got a poor quality. 3 key elements people, service and marketing -are not high quality. The only thing that is high quality is Ryanairs sales promotion.5. Almost all the Ryanairs services are self-services, except transaction by airplane. Correspondingly, Ryanairs supply chain has disadvantage such as se rvice waiting time and supply chains poor quality.Ryanairs trading in the last 5 years are talking that organisation had pick moments and also had some falls. Generally, company had shown excellent performance in cheap strategy, increasing it passenger number from 34.8 million (2005) to 66.5 million (2009), while many of Ryanairs competitors announce losses and even more go bankrupt. During 5 years Ryanair has opened bases several new bases such as Bournemouth, Birmingham and Belfast.Forecasting how the Ryanair business may proceed in the current economic climate, I may say that Ryanair will continue to exist in the world market, because its chief executive knows what people want low cost tickets. Consumers interest in traveling will continue to exist even in economic recession time. While consumers incomes are falling but supply is increasing, Ryanairs organisation will continue to offer low cost seats or even seats for free. I assume that in future Ryanair will expand it destin ations to other continents such as South America and Africa, because company has got huge possibilities for that. The only thing to do is to find additional investors and to think over the strategic plan.4.0. RecommendationsIn the light of these conclusions, I would recommend Ryanair organisation to improve organisations supply chain. All the Ryanairs destinations are operating into far-flung airports and passengers are confused about airports. All that it is necessary is change some of the destinations to major(ip) cities. Another solution is to write not only the airports name and state but write a citys name as well.In addition, I would recommend to improve quality strategy a specially one of the quality aspects people (HRM) as staff may start to strike. Their needs are not considered, company should prove such necessary elements such as uniforms and bi-annual medical examination. Of course, it will cost huge amount of money for the organisation but still staff will be satisfie d. As a consequence, staff will work better and Ryanairs service will be little improved as well.ReferencesBoddy, D. (2002) Management An Introduction (2nd Ed.) Harlow FT Prentice Hall.Bowersox, J., D., Closs, J., D., and Cooper, B., M. (2010) Supply Chain Logistics Management (3rd Ed.) New York McGraw-Hill.British Airways (2011) motive power classes online available from 5 February 2011.Garvin, D., A (1987) Managing Quality, New York The Free Press.Guardian.co.uk (2010) Ryanair returns to profit online available from 9HYPERLINK http//www.guardian.co.uk/business/2010/jun/01/ryanair-returns-to-profit 9 9 February 2011.Kotler, P., Keller, K.L., Brady, M., Goodman, M., and Hansen, T. (2009) Marketing Management. Harlow Pearson Education Limited.Lamb, W., Hair, F., J., and McDaniel, C. (2008) Marketing (10th Ed.) Mason Nelson Education, Ltd.Manak, S. (2009) Introduction to Business Organisation 121BSS, Glasgow McGraw-Hill.Palmer, A., and Hartley, B. (2006) The Business Environment ( 5th Ed.) New York McGraw-Hill.Ryanair (2009) About Us online available from 27HYPERLINK http//www.ryanair.com/en/about 27 27 January 2011.Ryanair (2010) Logopedia online available from 31HYPERLINK http//logos.wikia.com/wiki/Ryanair 31 31 January 2011.Ryanair Holdings (2010) Annual Report Financial Statements 2010 online available from 3 February 2011.Siobhn Creaton (2007) RYANAIR The encompassing Story of the Controversial Low-Cost Airline, London Aurum Press Limited.Smith, M. (2007) Fundamentals of Management, Glasgow McGraw-Hill Education.BibliographyBeckford, J. (2002) Quality (2nd Ed.) London Routledge.Calder, S. (2002) No Frills The Truth Behind The Low-Cost Revolution In The Skies, London Virgin Books Ltd.Harrington. J., H. (1987) Poor Quality Cost, New York Mareel Dekker, Inc.Hoyle, D. (1997) QS 9000 Quality Systems Handbook, atomic number 7 Butterworth Heinemann.Hutt, M., and Speh, W., Th. (1998) Business Marketing Management a strategic view of industrial and o rganizational markets (6th Ed.) Orlando The Dryden Press.McDaniel, C., Lamb, W., Ch., and Hair, F., J. (2008) Marketing (10th Ed.) Mason Nelson Education, Ltd.Waters, D. (2003) Logistics An Introduction to Supply Management, New York PALGRAVE MACMILLAN.AppendicesAppendix1