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STRATEGY

Compulsory formative assignment

RYANAIR – THE LOW FARES AIRLINE CASE STUDY

SummaryThe study case invites us to assess the success of Ryanair’s strategy in a highly competitive environment. For this purpose, we will successively evaluate its competitive positioning, its internal competencies, and its sustainability. We will conclude that Ryanair had followed until 2009 a low cost strategy, that its key resources and competences did satisfy such strategy in 2009 and that its principal competitive advantage, namely its position of leader of the low cost airline market, can be regarded as sustainable. |

1484 words (excluding tables)

Introduction

Ryanair was created in 1985 by Tony Ryan as a conventional airline company aiming at operating flights between Ireland and London. In 1991, financial difficulties led to its transformation into a low cost carrier, with Southwest Airlines as a model. Michael O’Leary was appointed as the Chief Executive Officer of the company soon after. Since then, the company has experienced rapid expansion. It was floated on the Dublin Stock exchange in 1997 and quoted on the NASDASQ in 2002. In 2009, traffic reached 66,5m passengers with a fleet of 232 Boeing 737-800, 41 bases and profit was over €318 m.

The study case invites us to evaluate the success of Ryanair’s strategy in a highly competitive environment. For this purpose, we will successively assess its competitive positioning, its internal competencies, and its sustainability.

I) Ryanair’s competitive positioning

The first question requires assessing Ryanair’s competitive positioning within the European airline industry using Bowman’s strategy clock method. Therefore, after a brief reminder of this method, we will attempt to show how Ryanair’s positioning has changed over time from position four to one of Bowman’s strategy clock.

Starting

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