Different laws/restrictions
The final reason I will be putting forward as to why some companies decide not to expand internationally will be because of the different laws of restrictions around the world. Laws everywhere today do not generally contrast each other, however the differences in laws everyone are extremely different and this can be because of a whole number of issues, maybe previous incidents in the country have led to a public demand to a change in law or sometimes the cultural or religious side of the country dominate the laws created by their government. An example of this change is that many of the laws in EU countries are different to the rest of the world. In other words, different firms and companies need to make sure their product or service being offered always meets the laws/rules and regulations set by the country in order to have any chance of success. Sometimes may countries decide not to try their products in certain areas because they themselves do not feel in meets all of the requirements set and if any company owner feels that way, the smart and sensible thing to do would be to just attempt somewhere else.
TASK 1
I am now beginning the first of four tasks of this unit and my main focus in this area will be to conduct a detailed investigation where I shall be analysing and explaining the international presence of two businesses of my choice. The main criteria of this coursework is that one of my two chosen businesses must be known on a global scale whilst the other must work solely in Europe and from this, I have decided to chose Ryan Air (Europe) and British Airways (Worldwide). The obvious connection between the two is that they are both airlines and the reason as to why I have decided to complete this coursework like this is because by choosing similar business types, it will solely be focussing on the differences and similarities of having a European presence and having a Global presence (which is the main point of the coursework) as opposed to going off the point and focussing on the differences in business types and differences in product range. Throughout this task, I will also be comparing the legal format of each business, the type of businesses, their target markets, the sector of each and whether or not each business meets their aims and objectives by having their international presence.
Brief Background of RyanAir
Before I begin comparing all the similarities and differences between the two businesses, I will firstly be giving a brief background check on the pair and explain from scratch how each have gotten where they are today. RyanAir is an Irish based company which has been successfully running for 23 years to date. It is well known around Europe and it’s main attraction to passengers are their extremely low flights which have made them a European success story. Since they were found in 1985 by an entrepreneur named Chris Ryan which is why the company has their name. Since that moments onward, RyanAir has grew in stature and is currently 3rd largest European airline in terms of numbers of passengers and the worlds largest airline in regards to international passengers. From the five years of 1998 - 2003, revenues of RyanAir have increased by over 500 million euros and net profit has increased by nearly 200 million euros during the same period of time - those statistics only show the growing success and dominance of RyanAir across the European nations.
From it’s introduction up to two years ago, this graph clearly shows the rapid rise of passenger numbers that RyanAir has obtained that has made them one of the most recognised airlines for EU countries and along whit their enormous rise in revenue and net profit, this shows their low flights plan have been a major success amongst customers.
(Passengers obtained from years of 1985 - 2006 = 42.5million).
However along with success nearly always comes criticism, and in 2006 RyanAir was named least favourite airline in a poll taken due to unfriendly & complacent staff. Along with this, RyanAir have also been judged poorly for their limited customer service, hidden fees and taxes and their misleading and perceptive advertising.
Brief Background of British Airways
For this early part of the task, I will be giving a brief background explanation on British Airways and how they have gotten to where they are today. British Airways are obvious a British based company which has been ever expanding and growing since it’s introduction 34 years ago (1974). British Airways is the largest and most successful airline in the UK and is one of the largest in the world. The two main hubs of British Airways are London Gatwick Airport and London Heathrow Airport. British Airways is known around the global for providing a high quality of service of flights.
Financial Performance
As can be seen by the table below, British Airways have quite an impressive financial performance market to show for the efforts in the market over the past 9 years from passenger numbers to turnovers to profits.
Criticisms
The first of March 2007 was an embarrassing day for British Airways as they were fined £121.5m for price fixing. Along with this, BA have also had to cope with the pressure of many of forms of criticism in the form of added cost, hidden taxes and
‘‘dirty tricks’’. All of this combined has contributed to the slow slip in rankings of BA which I will discuss further along in the task and recently this month - a channel 4 documentary was shown to viewers regarding all the problems internally of British Airways.
Proud Day
Despite all their problems, the 14th March 2008 was a memorable day for British Airways as terminal 5 of Heathrow Airport was built solely for the use of BA for a price of £4.3 billion and was socially opened by Queen Elizabeth II.
Legal Format - Differences and Similarities
When describing the legal format of a business(es), its is basically giving a description of what type of organisation it is meaning is it a private organisation, is it a public organisation or does it have another type of representation. The result of these three determine many factors such as the way in which shares of the company are divided and traded and this is what I will now be examining of RyanAir and British Airways picking up on any similarities and differences I may find along the way.
The first similarity I found between RyanAir and British Airways is that they are both public limited companies. This means that both can be bought by members of the public and both display their shares on the stock exchange as all PLC’s do. Along with this both companies shareholders have hired a board of directors to represent interests. By RyanAir and British Airways both being PLC’s, this instantly gives them the added protection of limited liability meaning that if either business was to decline rapidly into closure for whatever reason, the shareholders can also lose the maximum amount they ever invested into the company (depending on their shares) ultimately meaning no personal belongings of high value (cars, homes, electronics) can be taken away from them which is a massive advantage. Another similarity that Ryan Air & BA share in terms of their legal format is by law regulations, both are required to produce and present reports of the companies performances for their shareholders at fixed annual meetings, e.g. - every 6 months.
Type of Business - Differences and Similarities
In terms of the ‘type of business’, the most obvious and foremost similarity is that both companies are well recognised successful airlines. Both companies main priority is to constantly keep selling flight tickets at a high rate and to make sure passengers have safe comfortable journeys from destination to destination. Because of this, it means both businesses are involved in B2C (Business to Consumer) activities meaning the sales from a business to a consumer. One of the differences between the pair is that whilst RyanAir sticks to basic flights and accommodation, British Airways involves itself into freight handling operations; activities in which goods in bulk (large sizes) are transported by truck, train, ships, or aircraft. BA usually do this for other businesses; B2B (Business to Business) sales meaning the sales from a business to other businesses which is a great way of obtaining extra funds and forming strong relationships with other businesses. The destinations of their head offices also create another difference between the two businesses because whilst RyanAir’s head office is based at Dublin Airport in the Republic of Ireland, the head office of British Airways is based in the much more competitive city of London; Heathrow Airport.
Target Market for each business - Differences and Similarities
When attempting to discover the target market for a business, product or service, there are a wide range of factors to consider. A whole target market is not just based on one type of people - but are influenced by many things such as age, customer needs and wants, etc. A target market is a specific brand of people mixed with different characteristics that a company are focusing on to sell their product or service to. For this part of the task, I will identifying and explaining the target markets of both RyanAir and British Airways and the similarities and differences I find along the way. As RyanAir are solely a European business, the first characteristic of their target market will obviously be European passengers. Because RyanAir only specialise in flights inside of Europe, it would be a senseless idea and a complete waste of time to try and identify any passengers looking to fly outside of Europe. In a contrast to this, as British Airways are a global company, this does not apply to them as they operate flights all around the world. So on a different scale, British Airways will be targeting any type of passenger regardless of what destination they are trying to or from. As a result of this, British Airways will probably always be bigger and gain more recognition than RyanAir because they will always have the millions of passengers that use their service outside of Europe to add to the ones they already have inside Europe compared to RyanAir’s just European customers. That is with out a doubt a massive advantage that BA has over RyanAir, but because of this RyanAir will most likely always gain the upper hand in cutting costs (which is a basic objective of most businesses) because unlike RyanAir, British Airways have to pay extra for more planes and would also have to pay extra for all the hired staff in non-EU areas such as Asia, Africa, North & South America and Australia.
Another characteristic to focus on is the needs and wants of the customers and what they are looking to gain from a product/service. It is fairly obvious to see from the way RyanAir promote and advertise their service, that they are more concerned with prices than quality. Even though, they would most likely not be prepared to admit it, the owners of RyanAir probably know that they could not compete with likes of British Airways and American Airlines in terms of quality; and that is why they play to their biggest strength in extremely low fares to obtain the kind of customer base they do. Because of this, RyanAir most probably target passengers looking for an efficient low cost flight as opposed to high quality. On the other hand, BA probably asses their situation much differently. For the quality they offer, it would be too much of a risk to offer their service at the prices that RyanAir do. This is why British Airways do much to improve the quality and service of their flights but of course at the same time trying to offer a reasonable price. During the television advertisements of BA, it shows a man resting on a lounge (in what is obviously a first class flight) being offered a glass of champagne being a female air hostess. On the other hand, during the TV advertisements of RyanAir, low prices constantly bombard the screen and that only shows the sheer difference between the interests of the two businesses. So whilst RyanAir is more focused on price; British Airways is more concerned with factors that affect the quality of their services such as in flight entertainment, personal service attention from cabin crew, support for passengers at the occurrence of delays and cancellations of flights. So consequently, British Airways mainly target customers who are looking for high quality efficient flights but at the same time are willing to pay more for it.
Sector of each business - Differences and Similarities
There are a number of ways in which different sectors can be divided and when trying to match a specific business to a specific sector; you must look at the sector heading and compare this to the main activities of the business to find an appropriate match. For example, businesses that are involved in extracting raw materials would be placed in the primary sector and businesses involved in construction and manufacturing would be in the secondary sector. However, (and this is where it is relevant to British Airways and RyanAir) a different way of discovering different sectors would be found in many different types of newspapers on a specific page named ‘the share page’ where shares of businesses are represented by shares. Because both British Airways and RyanAir are both public limited company, information about the shares of regularly available to the British public in case of possible buyers. Another similarity between them is that they are both placed under the sector Transport on the Stock Exchange for the simple reason that this is the area in which both are providing services to the public by flights and in British Airway’s case, freight services as well.
Product Range of each Business - Differences and Similarities
A product range is very simply what it’s called, a range of different products. The wider a product range solely depends on how many different types of products or services a business decides to offer to the public. It is generally a better idea to have a wider product range because it then gives consumers more chance and therefore a higher chance of buying something. Nearly all businesses decide to release information regarding their product range on their company annual report. When people think about the similarities and differences between the product range of British Airways and RyanAir, they may think they are exactly the same as they both simply offers and accommodation, but if looked at in more depth; we can see there is more to it. The product range of RyanAir is flights and accommodation around Europe and even though British Airways may offer the same services, they offer theirs on a much more broader scale. An example of this could be food - whilst RyanAir offer the very basic food rations for all, British Airways provide a more attractive list (speaking from experience of suing both airlines) to accommodate all needs - I.e. vegetarian meals for vegetarians. Along with this British Airways are also involved in B2B activities in regards to freight services and for young passengers, BA also provide a full service for young passengers who are travelling by themselves. It is extra factors like these which make the quality and prices of BA flights higher than those of RyanAir and probably a massive element as to why they are much more successful as well.
Identifying and Explaining corporate aims and objectives - Differences and Similarities
Nearing the end of task 1, I will now move onto a section where I will be identifying the corporate aims and objectives of both RyanAir and British Airways, I will be explaining what is the purpose of them having these objectives and list any of the similarities I may find along the way. When deciding what shall be the next aims and objectives of a business, there are a large amount of factor that must be considered - the size of the company, the current performance of the company, the age of the company, etc. All of these factors will contribute as to whether or not the objectives set can be seen as SMART; specific - this means the objective must be precise and clear and specific to what the business is aiming to achieve; measurable - this means company owners should easily be able to measure whether or not the objectives are being met over a specific time period; achievable - meaning the objectives must have a fair chances of being achieved given the resources available; realistic - this is very similar to achievable meaning that the objectives must have a realistic chance of success, e.g. a chip showing having an objective of gaining £5m profit in one year is extremely unrealistic; time-related - this means the there must be a reasonable amount of time available for the objective to be achieved.
The first business of the two whose aims and objectives I will be focussing on is RyanAir. During this task, I was able to gather much substantial secondary data regarding the aims & objectives of RyanAir. Based on what I wrote earlier in this assignment and the type of business RyanAir are along with their advertising, I am estimating that most of Ryan Air’s objectives will be centred around saving money. During my research, I was able to discover the a section of the strategy document that RyanAir presents which includes in sentences rather than a list, some of their aims and objectives. It read as follows:
‘‘Ryanair’s objective is to firmly establish itself as Europe’s leading low-fares scheduled passenger airline through continued improvements and expanded offerings of its low fares service. Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies.’’ - Taken from GCE A2 Level Applied Business textbook.
From this small passage, there are around 3 or 4 sections that can be taken out and be named as aims and objectives. The coloured areas of the text is in my opinion what can be classified as aims and objectives as I have done in the small table below:
I will now be focusing strongly on the aims and objectives of RyanAir using a combination of my own personal opinion and secondary data. During this, I will be listing the aims of RyanAir, the objectives used to achieve these and be explaining the reasons behind having these aims and objectives. Below is a table I have created with the information regarding RyanAir’s aims with the relevant objectives placed beside them:
Now that all of these aims and objectives have been identified, I will now be explaining in detail as to why RyanAir have these aims and objectives and whether or not these are helped to be met the an international presence.
Become established as Europe’s leading low fare airline
As I mentioned earlier in this task, because RyanAir cannot compete in terms of quality and service with the world’s largest airlines, they make their name and obtain their customer base by charging extremely low prices and that is what this aim is all about. RyanAir hope to be known as the airline to use if you want the cheapest possible flight from all European airlines and the most obvious strategy to use when trying to achieve this is charge low fares (objective) which is what they do better than anyone. Despite all the many different aims and objectives that different companies have today, the core of all of them (regardless of the business) is to make a profit. When companies charge high prices, the harder it is to attract customers but the lower the amount of customers would be needed to get a profit because the prices are so high and it works the other way as well. If companies charge low prices, the easier it would be to attract customers because demand would be higher, however the risk is that you need more customers to make a profit because the prices are so low and this is the strategy that RyanAir use and use to great effect. In a figure taken in 2004, it shows the average flight cost of RyanAir compared to other competitors:
Data obtained from textbook
From this table alone, it is clear to see that RyanAir are achieving this aim with considerable ease. As seen, EasyJet come second in the rankings however they still charge 52% (over half) more than the flights of RyanAir and these statistics only increase as we look lower in the rankings. An example of this is Alitalia, they are the 5th lowest fare airlines in Europe which is a proud statistic to have but their average price (186 euros) is still a massive 353& higher than that of RyanAir and that just shows the type of dominance RyanAir are enjoying in the low fare airline.
In terms of RyanAir meeting this by aim by having their international presence, I believe they defiantly do. If the aim is read properly - ‘‘Become established as Europe’s leading low fare airline’’, it is clear that RyanAir hope to become Europe’s leading airline and so to have any chance of achieving this, logic tells us they have to have an international presence. Back during it’s introduction in 1985, if the owners of RyanAir had never decided to expand outside their home nation of Ireland, then they would only be seen as the leading low fare airline in the United Kingdom and therefore left with a 0% chance of ever achieving this aim. So in conclusion, having an international presence has definitely helped them (RyanAir) meet this aim because with an international presence, they would not even be seen as a European business and so will have no chance of being seen as Europe’s lowest fare airline.
Ensure a commitment of safety
This is not an aim that RyanAir have for their own benefit or profit, but to make sure they stay within all the current laws and regulations there are regarding safety within businesses. In the business world today, safety is one of the highest priorities whether it be safety within a building, safety amongst employees or more importantly safety amongst customers and all businesses must make sure that all safety measures are met - especially for an airline. Some businesses have higher and more intense safety precautions than others because if something were to go wrong, some businesses would be hurt more than others and RyanAir is definitely one of these businesses. As aircrafts fly thousands and thousands of miles above the ground, sometimes in very difficult conditions, if something were to go wrong on a flight the end result could be and most likely would be devastating. Along with this, because RyanAir are an airline, they would be in the global eye for negative reasons for a very long time if an event like this was to take place which would not only make customers lose their trust of the company - but an inquest would also have to be completed as to what went wrong and if deemed to be the fault of RyanAir, the company could be forced into closure. Because of all of this, it is a very sensible idea to have this as one of their aims and their objective of this aim is to have planes regularly checked and maintained. This would mean make sure no such things as petrol/oil shortages occur during flights, no leaks, etc. As to whether having an international presences helps RyanAir meet this aim, I am not 100% sure. In one sense, it may because today, EU laws are much stricter than the laws of single countries laws so therefore once they became classified as a European business RyanAir may have felt more pressure to ensure all safety measures were carried out more so when they were just operating in a small amount of countries. On the other hand, being an airline whether it be an international airline or a small airline in 3-4 countries, the fact that you are an airline of some sort should be more than enough motivation to make sure that safety checks are carried out so nobody gets hurt. So whether or not having an international presence has helped RyanAir meet this aim and objective I am not fully sure as it can be looked at from both ways however there are strong points on both sides.
Cut costs
Out of all 3 aims, this is without a doubt the least unique and most likely a target of nearly all businesses across the world. ‘‘Cutting Costs’’ is what would be classed as a basic aim/objective because it is one of those that can apply to all regardless of product range, target market, etc. When a business sets out to cut costs, they want to minimise all the costs of the things that keep the business running as so not to affect profits and this is what RyanAir are also trying to achieve. RyanAir’s objective for this aim is to ‘‘use internet and telephone services as a quick and inexpensive way to handle all customer bookings and questions’’. The internet and telephone are two of the most commonly used appliances across the globe and are used nearly everyone from homes to workplaces and for a company who gains as much profit and sales revenue as RyanAir, this objective fits extremely well for them because the costs of keeping those two (internet & telephone) running would be very low.
In contrast to the first aim, I do not think RyanAir having an international presence has helped them to meet this aim - I feel that it actually goes against what they are trying to achieve. Despite having an European image that has no doubt helped RyanAir gain much success in terms of factors such as - wider recognition, higher profits, higher sales revenue and a higher customer base. Them being a European business no doubt only adds to their costs because as they now operate in many countries across the continent - that in turn means that they have to have a large amount of staff working it different nations and a higher number of planes flying all over Europe and high staff and a large amount of planes is going to cost RyanAir a substantial amount of money. However, due to the sheer success being an international presence has given to RyanAir, they are easily able to deal with these costs and are no doubt better off as a European company - it is just in regards to this aim, it does not help.
Aims and Objectives of British Airways
I will now starting writing out the information I have gathered regarding the aims and objectives of British Airways, I will be explaining why British Airways have these aims and objectives and just like I did for RyanAir, I will be evaluating whether or not having an international presence has helped them to met these aims are objectives. As British Airways have a full global image as opposed to that of RyanAir who only have a European image, there aims and objectives are likely to be much more ambitious as an international business always the chance to gain higher success than European businesses despite the costs being higher. During recent secondary research completed on the internet, I was able to find that the mission statement (a short statement explaining what a business hopes to achieve in the long term future) of British Airways is to – ‘BE THE UNDISPUTED LEADER IN WORLD TRAVEL’. From this, it is easy to identify that British Airways hope to be the largest and most used airline across the world without it being called into question. When I discovered this mission statement, I wanted to discover if it had been achieved – below are two pieces of secondary data from internet sources I gathered which gave me a definite answer:
Information obtained from:
http://money.cnn.com/2005/06/02/pf/goodlife/best_airlines/index.htm
This is a table I was able to find on the money section of the CNN website and it clearly shows the top 10 airlines named the best 10 in the world in 2005. It is clear to see that from British Airways being named in 5th place, that have failed to achieve their mission statement for this year despite their massive global success in a year in which they raised £7,560m in turnover and gained a net profit of £130m.
Information obtained from:
http://www.infohostels.com/notizia.php?chiave=428
This is a table that contains data I was able to gather regarding the names of the world’s 20 leading airlines however in contrast to the last data obtained, it is a much more updated reading as it represents the current year and it has also been taken from a different internet source. The only way in which British Airways can achieve their aim is to consistently end up top of rankings such as these. In my last table that represented the year of 2005, it showed that BA failed to reach their target by finishing 5th, and this year they have fallen further behind not even being able to finish in the top 10. As the top 10 was as much as this website was willing to show to the public so I cannot be sure where British Airways actually finished up, but the fact they have fallen a minimum of 6 places over 3 years shows they may be beginning to fall behind the other world leading airlines such as Singapore Airlines and Cathay Pacific, and worst more they are moving further and further away from what they stated they wanted to achieve in their mission statement. There could be many reasons for British Airways recently falling out of favour with many passengers, particularly some of the criticisms I explained they have been receiving earlier in the task under ‘Brief history of British Airways.’
Now that I have finished explaining the mission statement of British Airways and whether or not it has been achieved, I will now be focussing on the aims and objectives of British Airways just as I done with RyanAir. I will be explaining in great detail how their aims are approached with suitable objectives on how the influence of British Airway’s international presence helps them (or not) in regards of their aims and objectives. After much research in textbooks and on the internet, I was unfortunately not able to find any official aims and objectives of British Airways, so using my business knowledge and the mission statement, I will create a certain number of aims and objectives that BA may use or target towards. As can be see below is a table I have inserted containing the relevant data regarding BA’s aims and objectives:
To be the world leader of airline travel
This aim is as simple and easy to understand as it’s title - from this aim British Airways want to be the leading airline in the world. Today, British Airways are regarded as one of the best and successful airlines on the globe, but by this aim they send a mission of intent to their competitors that they want to be the undisputed best and that is the reason they decide to use this as their mission statement. For BA, the objective of this aim is to ‘‘continue to provide a high quality of service before, during and after flights’’. This gives a clear declaration that if they (British Airways) continue to provide the same level of quality they have over recent years, that same level of quality that has brought them to where they are today, then they have the utmost confidence that this can take them to the top of the list of the world’s leading airlines. However, I personally do not have the same confidence as British Airways about this because if you look at the previous two pages of this coursework, I have provided tables of the years of 2005 and 2008 of the world’s leading airlines showing that in 2005 BA finished 5th and in 2008 they weren’t even ranked in the top 10. This shows that at this present moment in time, British Airways are quite a long way off achieving this aim and before they continue to peruse it, they should most probably fix the problems that have began their slow slip in rankings the many problems that have attracted some many criticisms of them recently.
In regards to whether or not having an international presence has helped British Airways with this aim or not, it most certainly has despite the fact the aims has not yet even been reached. Wanting to be the world’s leading airline is a very ambitious goal to aim for not just because it is a billion pound industry, but also the level of competition is one of the highest you will find in any field of the market. However, if British Airways was not a global business, there is no chance of the aim even ever been created because to be the best in the world in a particular market, you have to operate around the world and not just in one country or one continent and for that reason, yes, having an international presence definitely helps BA try to achieve this aim.
Ensure no. of passengers flown is higher year by year
Just like their first aim, the meaning of this one is as clear as it’s title - the meaning of this aim is that British Airways want the number of passengers that use their service to increase every year. The reason behind this aim is because if BA can successfully achieve this - then it is not just their no. of passengers that rises, but many other factors that are affected by this variable. For example, as the number of passengers increases - the turnover of the company will increase or as the number of passengers increases, the global recognition of British Airways. So that are also a lot of other positive factors that come from increase in passengers and that is why I believe they have this aim. In order to check if this aim has become successful or not, I completed a host of secondary research and from the internet in the form of , I was able to discover the number of passengers flown by British Airways over the past 8 years:
As can been seen in the table, it is only during the past 2 years (31 March 2006 - 2008) that British Airways have been able to successfully use the aim to their benefit. From 2006 - 2007, passengers numbers rose by about 600,000 and from 2007 - 2008, the numbers rose by near 100,000 so on those counts there is steady improvement however unfortunately from the years of 2002 - 2006, numbers decreased by about massive 8,000,000 which no doubt must have had a terrible effect on the overall profit of BA during those years.
Even though the table shows that British Airways have done fairly poorly in attempting to uphold this aim, I still believe them having an international presence has helped them in at least trying to achieve it. The full purpose of the aim is for British Airways to attempt to higher their overall customer base and there is not better way of obtaining more customers than working around the globe because that is where the majority of customers are. If a business solely operates in the UK then obviously they are restricting themselves to customers only living in the UK and if a business works in Europe, then that business is restricting themselves to customers living in Europe however for British Airways, there are no restrictions because they are working in nearly all the countries in the world and so are giving themselves the best opportunity of fulfilling this aim, especially by working in some of the largest population the globe has to offer such as India, Russia and China.
Make sure a high quality of safety is provided to passengers
This is a very similar aim to which RyanAir had and it’s main focus is surrounding safety. The safety of a passenger before the flight is in the hands of the airport they are using, however once in the air it is the sole responsibility of the airline that the customer has chosen to ensure that they reach their destination safely and comfortably. As I mentioned earlier in this task, if something were to go wrong during flight, the effects would be disastrous not only for the passengers on board, but for the business afterwards and it is for that reason I believe British Airways have this as one of their main aims and objectives. Even though the safety of passengers and cabin crew is the most important factor during all flights, I believe British Airways also make sure staff comply with this aim to also protect themselves as a business. British Airway’s objective for this aim - ‘‘ensure safety checks are carried out on all BA aircrafts’’ is probably the most obvious and the most logical objective they can use for an aim of this kind because a disturbance with the plane is really the only thing that could cause terrible effects during flight excusing terrorism however it is more the job of staff of the airport to make sure this does not happen as opposed to staff of the airline. Safety checks of aircrafts could include things such as checks of locks, checks of oxygen masks, checks of all escapes, check of oil and petrol before flight, check of plane mechanics (e.g. - wings) - it is factors like these that if all properly complied with will result in safe and efficient flights and therefore the success of this aim.
In terms of whether or not British Airways meet this aim with an international presence, again I am not completely sure just as I was not with RyanAir’s safety related aim. In one way, the added pressure of being a global business means that there are even more people watching and judging their development and progress, and there would definitely be critics waiting for BA to do anything wrong - so because of that, this gives the staff of British Airways the extra incentive to want to achieve this aim so to resist the negativity that would be thrown towards BA if they were to fail.
Differences and Similarities between aims and objectives of British Airways and RyanAIr
My main focus before this part of the task was identifying the aims and objectives of both RyanAir and British Airways, explaining this aims and deciding if the international presences of both of these businesses help them to achieve their aims and objectives. Now that I have completed that piece of criteria, I will now be moving onto a new part of the coursework in which I will be comparing the corporate aims and objectives of both RyanAir and BA and explaining any differences and similarities I discover along the way.
RA = Become established as Europe’s leading low fare airline
BA = To be the world leader of airline travel
The first aims I will be comparing are the first aims I recorded for each business. These aims may not be exactly the same, but they are extremely similar in the sense that by achieving these aims, both companies are hoping to dominate a particular market. For RyanAir, they hope to become established as Europe’s leading low fare airline and British Airways hope to be the world leader of airline travel. These are very different markets but it is the fact that both BA and RyanAir hope to be the best in these markets that make these aims similar. However, it is the different internal presences of both of these businesses that contribute to the aims being different. If the titles of the aims are properly read, it is clear that RyanAir want to be the leading low fare airline in Europe whilst British Airways want to be the world leader in world travel. This is because as RyanAir are only a European business - they can only restrict the ambitions of their aims to around Europe now matter what the aim is regarding however because British Airways have a global image, in terms of location their aim can be anything they want it to be and that is how their international presences contribute to the differences in aims. In regards to the objectives that each business has for this aim, there is also a sense of difference and similarity between them as well. BA’s objective for this aim is to ‘‘continue to provide a high quality of service before, during and after flights’’ whilst RyanAir’s is to ‘‘charge low fares’’. Despite this aims being very different in strategy, they are also similar in a way because both companies feel they can achieve this aim if they continue to what have been doing over the years. For years now, British Airways have been providing a high quality of service and for year RyanAir have been charging low fares and that has gotten the pair to where they are today - so the similarity is that both BA and RA feel that a continuity of what they have also done can help them fulfil this aim - it is just their strategies that provide the difference.
RA = Ensure a commitment of safety
BA = Make sure a high quality of safety is provided to passengers
These two aims may be different word for word in their titles, but their meanings are identical. The two focuses of both British Airways and RyanAir when making these aims is to make sure that all flights carried out are done in a safe manner. By complying to this aim, both businesses want to make certain that all flights are properly carried out as so nobody (whether is be staff or passengers) are hurt or even worse killed during flights as this is the full responsibility of any airline and that is what makes this aims basically 100% similar. In terms of the objectives for this aim, RyanAir’s is as follows - ‘’have planes regularly checked and maintained’’ and BA’s is ‘‘ensure safety checks are carried out on all BA aircrafts’’. Just like the aims, the titles may be different, however they mean exactly the same thing. With these objectives, RyanAir and British Airways are stating that all safety checks on all planes/aircrafts must be carried out as so to avoid failure of the aim. With these aims and objectives, the full purpose is that all planes used by both companies are up to a safe and satisfactory level so safe and efficient flights can be carried out without any problems and that is what not only makes the aims, but also the objectives identical.
Type of Competition That RyanAir and British Airways face in the domestic and overseas market
For the final part of task 1, I will be looking at the type of competition that both British Airways and RyanAir face not only in their own domestic markets, but also in the overseas market as well. Before I beginning explaining into depth the type of competition that both of these businesses face, I will firstly be explaining the two main types of competition and these are perfect competition and imperfect competition. It is fairly obvious by their names that the two contrast each other perfectly. Perfect competition occurs is involving providing an almost identical service or product in the same market whilst appears when the competition is less direct because they may be providing the same type of product/service however they may be target different types of customers are there could be something that differentiates the service or product like RyanAir and British Airways.
Competition of British Airways
When trying to discover who you competition is, you must look at their product range and the type of customers they are trying to attract and if they are similar to yours, than they can them be classified as competition. So as I mentioned earlier in the task, British Airway’s target market is global passengers looking for a comfortable high-quality service flight so for this part of the task, I will now be looking at the type of competition British Airways face in the UK (domestic) and around the world (overseas). In terms of competition across the UK, British Airways will most likely never be worried because by far and away, they are the leading UK airline and have been for many years so matter what completion comes along they will probably be fine. Their main competition domestically most likely comes from BMI. Just like British Airways, BMI operate in global flights and are know for providing a high level of service and are currently the second largest airline in the UK (behind BA). So gathering this information, nobody can deny that they are an extremely successful airline however they still don’t even come close to British Airways in terms of global recognition, passenger numbers, turnover, profit, etc so even though by statistics they are the biggest competition to BA for the leading airline in UK title, the still have a long way to go to even match them let alone take them over. In terms of an overseas market, it is not as easy as British Airways as it is domestically. British Airways are without a shadow of a doubt one of the largest airlines in the world, however in the overseas market, it provides much more competition and that is probably why BA aren’t as dominant globally as they are domestically. The main difference is that in the global airline market, there are so many world class airlines such as Singapore Airlines and American Airlines and that is why it is so difficult to be ranked 1st. As I have mentioned, in the UK no other airline really comes close to BA however in a poll taken this year, British Airways were not even voted in the top 10 and that shows the difference of level, quality and competition of the overseas market compared to the domestic market. If I had to say, I would list the like of Singapore Airlines, American Airlines, Cathay Pacific, Emirates Airlines, Asiana Airlines and Qatar Airlines as British Airways main competition because they have the same product range (high quality flights) and the same sort of target market and along with this, they are near enough all on similar levels in terms of global recognition and success. At the moment, I would say British Airways aren’t dealing with their competition the best they can given their resources, because as I mentioned before, they were not even in ranked in the top 10 this year which means a minimum of 10 other airlines are currently doing better then they are which completely goes against their mission statement to be the ‘undisputed leader in world travel’.
Competition of RyanAir
Just like I did with British Airways, when trying to evaluate the competition of RyanAir I will look at their product range and target market and see what other companies fall into similar categories. As I mentioned earlier, RyanAir are a low fare airline who make their name by charging extremely low flights so when trying to find their domestic and overseas competition, I will have to look at airlines who have a similar criteria to this. In terms of domestic competition to RyanAir, I would have to say the most obvious that comes to mind is EasyJet and Fly Thompson. EasyJet & Fly Thompson, like RyanAir are low fare airlines that operate solely in Europe with a similar target market (European passengers looking for a cheap and efficient flight). Simply because of this, along with them being based in the UK and being two of the largest low-fare airlines in Europe, they have to be classed as the two main serious domestic competition for RyanAir. In terms of the overseas market, yet again just like British Airways, the competition rapidly rises. When looking for the overseas competition of RyanAir, the criteria involving the target market and product range will remain unchanged, however I am now looking for businesses across Europe. Some low-fare airlines which could be named as overseas competition for RyanAir are the likes of Sky Europe (Slovakia), SnowFlakes Airlines (Sweden & Denmark), Virgin Express (Belgium), WizzAir (Hungry) and AirBerlin(Germany).Out of all of these, the main competition most likely comes from AirBerlin because not only are they one of the lowest charging airlines in the world but they are also one of the world’s largest low fare airline so for that reason, they are probably the main overseas competition of RyanAir. In contrast to British Airways, the domestic market probably provides more of a challenge to RyanAir than the overseas market because despite EasyJet being the highest level of competition for RyanAir within the UK and AirBerlin being the highest in Europe (outside UK), EasyJet are actually the second largest low fare airline in the world whilst AirBerlin are ranked 3rd. Despite of all of this, I believe RyanAir deal with their competition very well because not only do they stick to their aim which is to be Europe’s leading low fare airline, they are also the largest low fare airline in the world - so for this they must be doing something better than their competition.
