Captain Ray Conway was appointed as Chief Pilot in June 2002, having joined Ryanair in 1987. He has held a number of senior management positions within the Flight Operations Department over the last 17 years, including Fleet Captain of the BAC1-11 and Boeing 737–200 fleets. Ray was Head of Training between 1998 and June 2002. Prior to joining Ryanair, Ray served as an officer with the Irish Air Corps for 14 years where he was attached to the Training and Transport Squadron, which was responsible for the government jet.
Caroline Green was appointed Head of Customer Service in February 2003. Prior to this, Caroline served as Chief Executive Officer of Ryanair.com between November 1996 and January 2003. Before joining Ryanair, Caroline worked in senior positions at a number of airline computerized reservations system providers, including Sabre.
Michael Hickey has served as Director of Engineering since January 2000. Michael has held a wide range of senior positions within the Ryanair engineering department since 1988 and was Deputy Director of Engineering between 1992 and January 2000. Prior to joining Ryanair in 1988, Michael worked as an aircraft engineer with Fields Aircraft Services and McAlpine Aviation, working primarily on executive aircraft.
Howard Millar was appointed Deputy Chief Executive and Chief Financial Officer on January 1, 2003, having served as Director of Finance of Ryanair since March 1993. Between April 1992 and March 1993 he served as Financial Controller of Ryanair. Howard was the Group Finance Manager for the Almarai Group, an international food processing company in Riyadh, Saudi Arabia, from 1988 to 1992.
David O'Brien was appointed Director of Flight Operations and Ground Operations in December 2002; previously, he served as Director of Flight Operations of Ryanair from May 2002, having served as Director of U.K. Operations since April 1998. Prior to that, David served as Regional General Manager-Europe and CIS for Aer Rianta International. Between 1992 and 1996, David served as Director of Ground Operations and In-flight with Ryanair.
Michael O'Leary has served as a director of Ryanair since November 1988 and was appointed Chief Executive Officer on January 1, 1994.
Edward Wilson was appointed Director of Personnel and In-flight in December 2002, prior to which he served as Head of Personnel since joining Ryanair in December 1997. Prior to joining Ryanair he served as Human Resources Manager for Gateway 2000 and held a number of other human resources related positions in the Irish financial services sector.” (Ryanair Ltd, 2007)
Top management at Ryanair each brings professional experiences in international and managerial skills into the company. They have diverse backgrounds, which brings different styles of management and unique skills for their position. Ryanair has international operations and most of the top management has had other experiences and positions with other international corporations. There are no acquired companies at this time, so no executives of acquired companies are part of top management. Top management at Ryanair stays involved with the corporation, therefore they are responsible for the corporation’s performance over the past few years. There are no managers that have been in their current positions fewer than three years. The newest top manager is Caroline Green who was appointed Head of Customer Service in February 2003. Most of Ryanair’s top executives have been with the company for several years and in generally it seems that Ryanair appoints many of the officers to their current positions are years of service to the company. This suggests that internal promotions are the most likely way of hiring top management.
The top management team has established a systematic approach to strategic management, which is seen through its profits and growth of the company. For a company to be successful top management needs to be involved in the strategic management process, success begins at the top and works though all levels of management and employees. The performance of Ryanair shows that top management interacts with lower level managers and the board of director quite well. It seems that the strategic decisions, such as purchasing new more environmentally friendly aircraft, are made ethically and in a socially responsible manner. The top management at Ryanair is sufficiently skilled to cope with likely future challenges, because of their diverse background, management skills, and proven adaptability.
EXTERNAL ENVIRONMENT (SWOT)
SOCIETAL ENVIRONMENT
Ryanair has faced many challenges over the years and 2007 was no different. Fuel prices are an economic concern for Ryanair, increasing fuel costs are a current, and from the forecasts will be a future threat. Fuel costs were 40% of operating costs in 2007, an 5% increase. Ryanair has pledged to low-fares, which means they won’t pass the fuel costs onto passengers or impose a fuel surcharge on them. (Ryanair Holdings PLC, 2007)
There have been some political and legal issues concerning Ryanair such as, a new European Union (EU) regulation came into effect, various legal actions, terrorism, and security. The new EU regulation was to compensate air passengers that were inconvenienced by delays, cancellations and denied boarding. This was intended to enforce the reduction of these inconveniences. Terrorism and Security increase had an impact on costs and risks in the airline industry worldwide. Ryanair suffered a loss of about €1.9 million in just a few days following an incident in the United Kingdom. In addition Ryanair has been in dispute with several airports over landing charges. A recent dispute is with a rival Air France over Marseille airport, which Ryanair air planned on basing two aircrafts serving 13 routes. The dispute was mainly about unfair discounted landing and passenger charges on flights within France. (Thompson, Strickland, Gamble, 2008)
Other socio-cultural topics have emerged like environmental concerns, safety issues, and customer services or perceptions. Green houses gases have been a major concern for many people worldwide, which has caused an increasing pressure on there to be a tax on aviation fuel. Ryanair argued that aviation only contributed a small percent of carbon emissions, but still pledged to behave responsibly by arranging more efficient aircraft that uses less fuel and produces less pollution. There have been accusations of lax safety protocols, because of various incidents, but Ryanair has continued to acclaim its safety record through publications, new services, and free flights. (Thompson, Strickland, Gamble, 2008)
Ryanair has incurred many complaints about its actual service, like comfortable seats, amenities, and poor treatment of customers with canceled flights, despite them being the most punctual and voted number one for low-fares. (Thompson, Strickland, Gamble, 2008) These complaints are all opportunities for Ryanair to improve the service they give their customers.
These issues mentioned are very similar throughout the world like; fuel, environment, safety, and terrorism which are things that affect the airline industry. Some of the concerns are regionally focused on the European area, like the EU regulation, which only affects airlines going into and out of Europe and the tighten security in Untied Kingdom.
TASK ENVIRONMENT
Some of the forces that drive industry competition are the increasing traffic growth of travelers, families, and business as well as the overall revenues of the industry. These forces are generally the same for most industrialized countries and some developing countries, but can vary from country to country.
Ryanair has a good position in as a budget carrier; from the experience of past ventures the threat of new entrants that will succeed is very low. There is a threat of substitute services, like driving, trains, buses, and ferries. Driving long distances has become expensive, because of raising fuel prices. Trains are not as fast, but are a comparable way of travel, unless the location is overseas. Again buses take longer, but fees are less, and the location cannot be overseas. Ferries are limited, but can be a decent way to travel over waters. The bargaining power of buyers is strong, because there is a multitude of airlines they can chose to fly with. Plenty of customers are price concise, so Ryanair’s strategy of low-fares really uses that conciseness as an opportunity to be the best low-cost carrier. There is a very predominant competition within the airline industry, some are budget carriers, and others come with high prices and many frills. Ryanair is 29.9% of the market share for budget airlines in Europe, so their bargaining power is good with its suppliers. Government and unions affect the way most airlines have to do business, constantly regulating and implying or changing policies. Their power is strong among the airline industry.
The immediate environment that’s currently affecting the corporation has been a cash offer by Davy Corporate Finance and Morgan Stanley on behalf of Ryanair for the purchase of the company, Aer Lingus. Aer Lingus, if merged with Ryanair would account for 80% of all flights between Ireland and other European countries.
SUMMARY of EXTERNAL FACTORS
The following are the current key factors that are the most important to Ryanair and the airline industry in present time are fuel costs and political/government regulations. Fuel costs affect costs for the whole industries, but really is a concern for budget carriers. Ryanair has pledge to not impose these increases costs on customers, so it accounts for 40% of its operating costs, cutting into profits. These fuel costs consuming a large percent of the operating costs will still be a concern in the future. This relies on the forecasts that fuel costs won’t be coming down, which it’s highly likely for costs to increase in future.
INTERNAL ENVIRONMENT: Strengths and Weaknesses (SWOT)
CORPORATE STRUCTURE
Ryanair consists of a board of directors, officers, and shareholders. There are many pieces to Ryanair and authority is decentralized to many units including: operating, piloting, personnel and in-flight, engineering, customer service, flight operations, ground operations, and finance. These are mainly organized on the basis of functions, and geography also plays a key role. The structure is easy to understand, being based around function and appears to be implicit by everyone in the corporation. The present structure is consistent with the current corporate objectives, strategies, policies, and programs as well as with the firm's international operations, because it operates smoothly being organized through function then geographically. The corporate structure is similar to other airlines, which also operate through function then location, but its main difference is the focus on cost cutting techniques.
CORPORATE CULTURE
Ryanair has a well-defined corporate culture composed of shared beliefs, expectations, and values, which are clearly defined in their code of ethics. The things mentioned in the code of ethics are consistent with the current objectives, strategy, policies in place, and other programs within the company. The culture's position seems to be positive on important issues such as the quality of performance and adaptability to changing conditions, as well as internationalization.
The culture compatible with diversity currently has many employees of diverse backgrounds, which have been successful. Ryanair takes into consideration the values of each nation's culture in which the firm operates and also under law has to treat each employee with regards to laws of their own nation.
CORPORATE RESOURCES
MARKETING
Ryanair’s current marketing objectives, strategies, policies, and programs are based on guaranteeing customers the lowest air fares on the internet. They use their winning combination of low fares, punctuality, and customer service to attract customers, as well as trying to position their brand. The marketing structure is clearly stated, but also implied through their advertising.
The marketing is consistent with the corporation's mission, objectives, strategies, policies, and with internal and external environments, which is striving to be the best low-fare air carrier in the European area. This can be seen in their advertising, such as free flights, 99¢ flights, and other marketing approaches. From analysis of Ryanair’s market position shows that it marketing mix is performing well for them. A lot of their advertising is online, so its marketing mix is appropriate for both domestic and international markets. E-marketing has evolved usually adjusting to the conditions in each country in which it operates for simplicity purposes. Ryanair is an airline carrier that generates most of its sales from foreign environments considering its headquarters is in Dublin, Ireland.
The trends that are seen from analyzing their marketing are competitor exploitation and mainly to increase demand for low fares, punctuality, and efficiency. Example is their e-marketing of “Want to see how slow easyJet is? Click here!” This exploits their closest competitor. (Grimaldi, 2003) Past performance has shown that Ryanair’s marketing trends have impacted their sales and will probably have a similar impact on performance in the future.
This analysis has supported the corporation's past and pending strategic decisions based on low fares, punctuality, and good customer service. Ryanair focuses and brings out its strengths and its competitors weaknesses through their advertising, so its current marketing provides them with a competitive advantage. Compared to other corporations Ryanair’s marketing is average with its marketing performance.
Ryanair uses market segmentation and market research well to exploit its competitors, so marketing managers are using accepted marketing concept and techniques to improve the company’s performance. Marketing managers need to consider current statistics, developing services, main objectives and other issues concerning the company and customers. They have a large role in strategic management process, because they directly influence the customers.
FINANCE
The corporation's current financial objectives, strategies, policies, and programs are clearly stated in their Annual reports & financial statement under Outlook for fiscal 2008, as well as being implied through performance. These financial objectives seem to be right in line and consistent with Ryanair’s mission, objectives, strategies, policies of low fares, as well as with the internal and external environments.
Financial analysis for Ryanair: There was an increase in profit after tax of 33%, which was because of the 7% increase in average fares, so profit margin was 19.66%. There was a growth in ancillary revenues and an increased fuel costs by 50%. Staff costs rose 32% mainly because of higher pilot crews. Then operating margins decreased to 21% from 22%, which lead to an increase in operating profit by 28% compared to last year. Total operating revenues increased by 32%. Costs have also been increasing maintenance costs increased by 12%, marketing and distribution costs increased by 71%, and aircraft rental costs increased by 23%. (Ryanair Holdings PLC, 2007)
Trends that emerge from this financial analysis are costs are increasing, but profit is also increasing leading to gains in the company. Most statements are calculated in dollar, so there doesn’t seem to be a significant difference except when reporting on fuel costs. These trends have a positive influence on past performance and hopefully this will continue into future performances. In addition this analysis supports Ryanair’s past and pending strategic decisions, based on being a low fare air carrier.
Most airlines are reporting a decrease in profits, so this financial status provides Ryanair with competitive advantage, which is good for the price conscious consumer. Ryanair’s profit margin in 2007 is 19.66% compared to EasyJet with 8.47% profit margin (2007), Aer Lingus with 8.19% profit margin (2007), and British airways with 5.48% profit margin (2006). Ryanair seems to be competing very well considering their financial performance and comparing them to similar corporations.
Financial managers are using accepted financial concepts, are devoted to using techniques like auditing and employing financial personnel with expertise in financing. They use their knowledge to improve the current corporation and divisional performances, through a series of considerations like financial leverage, which is balanced, capital budgeting. They manage foreign currencies which losses have decreased €0.9 million because of the weakening US dollar. The US dollar exchange rates against the Euro have been a positive impact on the company. Interest receivable has increased by 65%, but interest payable has also increase by 12%, which still is a gain for Ryanair.
Finances do adjust to the conditions of each country, but mainly utilizes Euro and US dollar, considering the places it operates in which is the Europe area. Financeial manager has a large part in strategic managing process, because Ryanair’s focus is to be the lowest cost air carrier with Europe, meaning the focus is on finances.
RESEARCH AND DEVELOPMENT (R&D)
Ryanair has no finances invested into current R&D objectives, strategies, policies, and programs. Research and Development is implied through every branch of management, therefore it seems that the financing comes directly from the budgeting of each particular department. Each department manages their own research and development, so it is consistent with the Ryanair’s mission, objectives, strategies, policies, and with internal and external environments.
The role of technology in corporate performance can be found in many departments of Ryanair, like engineering, flight operations, and ground operations. The mix of applied engineering research is appropriate in regards to Ryanair’s mission and strategies. Research and development is a main part of the company, but doesn’t necessarily provide Ryanair with a competitive advantage. Ryanair doesn’t have any return on their research and development, because they don’t directly invest, therefore figures are not shown and cannot be compared.
OPERATIONS AND LOGISTICS
Ryanair’s service objectives, strategies, policies, and programs are clearly stated in their strategy document which can be found on their website. These are not only stated but can be seen through there performance as well. They are consistent with the corporation's mission, objectives, strategies, policies, and with internal and external environments. Operations consist of point to point short haul routes, lowest fare on the internet (which is guaranteed), low operating costs, good customer service, commitment to safety and maintenance. Most of the services and operations (other than administrative) are achieved internationally, because of the airline industry. “"Ryanair has the strongest business model of any European airline," Citigroup says in a Feb. 4 report, citing the carrier's lower-cost advantage, growth prospects, and strong balance sheet.” (Capell, 2008) The amount of outsourcing is appropriate compare to the competition and the purchases seem to be handled appropriately.
Average number of employees in 2007 was 3,991 with number of passengers per employee being 10,648, which is average in comparison to competitors. Facilities that are used are regional or secondary airports, in order to reduce the amount of congestion regarding flights and/or people. Efficiency ratings are good regarding punctuality, but they do have many customer complaints regarding customer service.
Ryanairs has successfully replaced all older model Boeing 737-200 aircraft with Boeing 737-800, as of December of 2005. These are considered the “Next Generation” aircraft, which are better on using fuel, excreting fewer emissions, and producing less sound. Ryanair has fleet of 137 aircraft having an average of 2.7 years per aircraft. Ryanair has plenty of transportation, via aircraft, to bring service staff and clientele together. Facilities are vulnerable to natural disasters, local and national strikes, but would still be able to function on most routes if something were to happen in one country or at one of its operating airports. Fuel is a large supplier for an airline, so decrease in resources effects operations, due to the increase of fuel cost.
There is an average mix of support staff to professional in Ryanair. Ryanair’s profit margin in 2007 is 19.66% compared to EasyJet with 8.47% profit margin (2007), Aer Lingus with 8.19% profit margin (2007), and British airways with 5.48% profit margin (2006), meaning they are performing well relative to their competition. Costs per person per kilometer is 4.8¢ per US dollar equivalent, which is the lowest of any airline, including Southwest airline (5.8¢) even though they are not a rival their strategy model is what Ryanair’s is based from.
Trends that emerge from the operations and logistics analysis are that Ryanair is a good competitor and usually is one of the top contenders. They keep operational cost low and still offer a safe, good, and needed service for their customers. These trends have positively affected Ryanair’s past performance and will probably contribute to the continuing success. This analysis has supported the corporation’s past and pending decisions. Their operations are providing the company with a competitive advantage regarding low fares and punctuality, but not regarding customer service.
The operations managers are using appropriate concepts and techniques to evaluate and improve current performance, like training and performance programs. Operations has to adjust to the conditions in each country that it operate and uses the facilities, their not only under the policies of specific airports, but they’re under the different countries laws as well. Operations manager has a large part in the strategic management process, because they need to keep costs low in order to continue being a low cost provider.
HUMAN RESOURCE MANAGEMENT
Ryanair’s current HRM objectives, strategies, policies, and programs are fitting and mostly implied from performance and budgets. They are a growing company, expanding in routes, destinations, so this means staff is also increasing. Most careers that are open with Ryanair can be found on their website, where the human resource management gives information according to the job’s location, who the employee reports to, the duties included, experience and qualifications, and the closing date of the position. Positions that are available are consistent with the growth and needs of the company, as well as being consistent with the mission, strategies, policies, and with internal and external environments. It seems that the HRM is performing well in terms of the fit between the individual employee and the job, but is slacking in other areas.
In the past Ryanair has come under fire for not recognizing unions, which has accused them of poor working conditions. There has been pressure from pilot associations, like the Irish Airline Pilot Association and the British Airline Pilot association, for different reasons. There have been settle lawsuits and appeal regarding different issues with pilots. In turn, Ryanair provides its pilots with a stable roster pattern, which mean they can have planned time off and this is also unique in aviation. (Thompson, Strickland, Gamble, 2008) In June of 2007, a strike effected Ryanair, all flights in and out their Belgian hub at Charleroi airport were grounded after the security staff walked out.
“Ryanair follows the normal procedure of recruiting new staff starting from advertising and a vacancy to interviewing and testing and than training but it does fall out on the proper training and development some staff has to pay for their own training. They arrange interviews by sending out letters to successful applicants where the interview is held at a venue and everyone has to go through a test those who are successful are to be interviewed. The successful interviewers will than be recruited and trained by Ryanair. Training and development might be poor but it has to be understood by Ryanair that training opportunities provided by them can help create personal job satisfaction and help them retaining their personnel.” (Sara07, 2007) It seems that Human Resources department has a problem with staff turnover and motivation, despite their training and incentive efforts. Some of the staff even has to pay for their training upfront, which training is important to develop their skills.
Trends that have emerged from this analysis are issues within the human resources department that include turnover, strikes, union issues, and even some training negligence. Surprisingly past performance has been good regarding profits, but there have been many customer complaints and staff complaints. When staff isn’t happy with their job they are likely to be unreliable regarding customer service. These situations could have a negative impact on future performance. This analysis doesn’t seem to support any of the corporation’s decisions and need a revision. The HRM doesn’t provide the company with a competitive advantage, based on findings on customer complaints and staff grievances. The HRM performance seems to have encountered more rocks in the road than similar corporations.
“Compensation for employees emphasizes productivity-based pay incentives, including commissions for on-board sales of products for flight attendants and payments based on the number of hours or sectors flown by pilots and cabin crew personnel within limits set by industry standards or regulations fixing maximum working hours, as well as participation in Ryanair’s stock option programs.” (Ryanair Holdings PLC, 2008)
The company operates in many countries, therefore has plenty of diversity, and overall seems to manage it quite well. HRM has to adjust to the conditions in each country in which it operates, “according to the employment laws of the country in which the firm is registered. Ryanair court ruling states airline staff is covered by labour law of country in which airline is registered.” (Thomas, 2007) All countries that Ryanair operates in are industrialized, so the same code of conduct (Code of Ethics, 2007) would most likely be follow if they were to be established within a developing nation.
Human Resources Manager seems to be playing a small role in the strategic management process. This is based on the performance of the company by profits, punctuality, and despite the staffing issues and customer service perceptions.
INFORMATION SYSTEMS (IS)
Ryanair is using software from Northgate HR for its payroll and other HR services (Thomas, 2006) and also implemented a “flight booking system from the Open Skies booking system to New Skies, both from specialist airline software supplier Navitaire. The upgrade was to cope with increased demand, and run more quickly "especially during peak booking periods" owing to "the increased processing power" of the new system.” (CIO, 2008) These are a few of Ryanair’s current information systems objectives, strategies, policies, and programs. They don’t seem to be clearly stated, but are implied through performance and changes in procedures of operations and finances. The information systems are consistent with the corporation's mission, objectives, strategies, policies, and with internal and external environments.
Though the new open skies booking system has had problems with high demand, most of the information performances are providing a useful database, automating routine clerical operations, assisting managers in making routine decisions, and providing information necessary for strategic decisions.
Trends that emerge from this analysis are that the information systems are being developed well according to needs of the company financial and within its demands, despite the mild setback in the new system. These trends have had a general positive impact on past performances and will hopefully only get better with future performance. This analysis supports the Ryanair’s past and pending strategic decisions, as well as providing the company with a competitive advantage with flight booking and within the HR department. The information systems performance seems to be average in the stage of development compared to similar corporations.
The information system managers seem to be using appropriate concepts and techniques to valuate and improve corporate performance. They have shown through implementations of new soft wares that they know how to build and manage a complex database, conduct system analyses, and implement interactive decision-support systems. Ryanair’s information systems are global, at least with the flight booking system which is online. So far there has been any sign of difficulty with getting data across national boundaries.
The role of the information systems manager in the strategic management process is unique. They have a large part keeping Ryanair competitively advanced and the technology affects every part of the operations of company.
SUMMARY OF INTERNAL FACTORS
Finance and operations & logistics are the most important factors to the Ryanair and to the airline industry in which it competes.
ANALYSIS OF STRATEGIC FACTORS (SWOT)
Ryanair biggest strength is its low cost airfare, having 516 routes over 26 countries. They continue to open and offer new routes. In October of 2007 they announced 70 new routes and in December of 2007 they announced another 50 new routes across Europe. They have had traffic growth by 26% and a good profit margin (19.66%) which is better than most of its competitors. As well as being the most punctual airline in Europe.
Ryanair’s weaknesses are poor customer service and no frills air flight. This means they don’t give food or drinks, but offer them for purchase as well as offering gifts for purchase during the flight, averaging sales of only €1.30 per person. Both these things mentioned have been a source of customer complains. The no frills philosophy is part of the reason why Ryanair can offer such inexpensive flights. Staff turnover and training has been a problem for the human resources department, along with staff grievances.
Ryanair is based out of Europe, with only 516 routes over 26 countries within Europe. They have many opportunities to expand into other continents with the same or similar strategy. Another opportunity is the replacements of old aircraft. The opportunity is purchasing better aircraft for the environment, which would be being eco friendly/responsible and purchasing ones that are more fuel efficient, helping with costs. The recent replacements have produced 50% less emissions, 45% less fuel, 45% lower noise emission.
Ryanair has many threats, being any airline that has similar destinations can be a threat. There are many low cost airlines that have become known around Europe. One of its main threats is EasyJet, which emerged as a low cost airline with in Europe. They have matched quite a few prices and destinations of Ryanair. Southwest Airline could potential be a threat if they decided to become international, by providing customers with international destinations in and around Europe. A large threat is the rising fuels costs and fuel taxes imposed on aviation fuel. These increasing costs have accommodated for 40% of Ryanair operating costs, cutting into profits.
REVIEW OF MISSION AND OBJECTIVES
Most of the current mission and objectives are appropriate in light of the key strategic factors and problems. Problems that seem to need more attention are staff and customer issues, which should be embraced, by the human resources, personnel, customer service, and the operations department. The current mission and objectives of Ryanair shouldn’t be changed, because performance levels and other factors like profit margin are doing well.
STRATEIC ALTERNATIVES AND RECOMMENDED STRATEGY
STRATEIC ALTERNATIVES
Total Quality Management should be implemented for an overall positive development of each department. Potentially there could also be a revised objectives and more careful implementing of the strategy concerning the staffing, training, and evaluation procedures of the staff to ensure the quality and job happiness. New objective and strategies should start with Director of Personnel, Edward Wilson, Head of Customer Service Caroline Green, and Chief Pilot Captain Ray Conway. In addition, customer service problems would probably improve after the fine-tuning of the personnel strategies. The major feasible alternative strategy that’s available to Ryanair is differentiation as a budget airline, which they have tried to produce through their punctuality, but possibly could do better. Ryanair has done a good job becoming the cost leader, with their low-fare strategy and has seen a considerable amount of growth within this strategy. The team of directors at Ryanair are qualified professionals, which have had the experienced needed to develop corporate scenarios that can be agreed upon and implemented. TQM could positively impact the profits, quality of employee lives and overall customer service.
RECOMMENDED STRATEGY
Some strategic alternatives include differentiation and total quality management which is the recommended as overall strategy for corporate and business. Functional level strategy is more related to personnel recruiting, retaining, and training employees, “training efforts, facilitate continuous organizational learning, and help upgrade company competencies and capabilities.” (Thompson, Strickland, Gamble, 2008) Personnel policies should be revised, recruiting, retaining, and training, because of the analysis of poor staff turnover rates and some poor customer service.
Ryanair’s ability to differentiation its self from other budget airlines is a prime opportunity, which is also an obtainable goal for long and short term strategies. They already differentiate into terms of punctuality. Foreseeable problems would be mostly financial, as giving customers a little more frill may cost more, but if correctly implemented would impact profit margin tremulously.
IMPLEMENTATION
Total Quality Management should be developed and implemented to ensure quality service. In addition, there should be internal cross-unit coordination between, personnel, customer service department, and the chief pilot who should collaborate in the new strategies for programs to recruit, retain, and train employees to become more effective. Ultimately the director of personnel, the head of customer service and chief pilot should be responsible for the coordinated programs, but the managers directly involved with the employees should also be involved with these programs to make them as effective as possible. In regards to TQM, all the directors should be involved.
These programs are financially feasible and could even have a positive effect on future profits. Director of Finance should meet with these departments to determine the budgets that could be developed for these necessary adjustments. These priorities are appropriate to according programs and should be managed and implemented in timely fashion. New standard operating procedures will need to be developed for most departments’ concern initial and continuous employment.
EVALUATION AND CONTROL
The current information system is capable of providing sufficient feedback on implementation activities and performance, but enhanced information systems could improve the necessary implementations of TQM, as well as other functional programs. The information system isn’t necessarily integrated to supervise TQM situations, but other system, should easily be developed and installed to measure critical success factors. TQM and other implemented training (employee) programs can be pinpointed by area, unit, project and/or function of performance.
There are adequate control measures in place to ensure conformance with the recommended strategic plan, such as auditing and customer service channels of communications. Appropriate standards and measures are being used within Ryanair and the reward systems are capable of recognizing and rewarding good performance.
Reference:
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