Q1

Ryanair, the most successful low-cost airline company in Europe is a highly cost-effective, operations-
driven type of an airline company. This proposal introduces the major theoretical frameworks used in the
final report in order to highlight and elucidate various aspects of Ryanair’s strategic and operations
management practices. Analysing the industrial environment, strategic management theory and operations
management theory will all contribute to a complete depiction of how Ryanair manages to compete in
such a manner.

1. Business Environment:

Understanding the Business Environment:

To be in a position to achieve this, Ryanair must develop a solid knowledge of its business environment,
including both external and internal factors. External factors include those it cannot control, such as
economic trends, political regulations, technological developments, sociocultural influences and the
extent of competition within its industry. Thus, by distilling these into opportunities and threats, it will be
possible for Ryanair to future-proof its business by anticipating and adapting to changes within its
environment. Dess, G., Lumpkin, G., and Kaiser, J. (2021) Principles of Management (15th ed) New
York: McGraw-Hill Education.

Political

Political environment is when there is political instability or stability and government policy that affects
business in positive or negative way. If government is stable and are charging less tax than business can
prosper.

Economical situation of country plays vital role in business either to succeed or failure of business. When
consumers are economically stable, they can buy afford to buy product. If they are not their purchasing
power is low and they cannot afford various products which is not good for business.

Sociological

Sociological environment is another factor which affect business environment. In countries like Pakistan,
you can only sell halal meats, if you use normal meat, you are going out of business. So social cultural
traditional values play vital role in business succession.

Technological
If some business uses poor Quality of equipment or machines that do certainly affects business
environment. If they use new advance equipment and machineries, it can increase quality, saves time and
prevent wastage of raw materials which can certainly leads to increase in profit.

Environmental.

Climate, weather and natural disaster plays important business in different business, you need hot climate
to sell cold drinks, business need winter to sell warm clothes, similarly to sell umbrella you need rainy
season. If there is landslide, volcanic eruption there are various opportunities and threats according to
business.

Q2

Strategic management

Strategic management refers to evaluation, implementation, formulation of plans and policies that helps to
achieve organisational objectives and goals. It involves proper management of external and internal
environments, organisational goals and organisational resources to ensure organisational competence and
finally evaluating of plans and policy formulation.

Importance of strategic management for business.

Direction

Proper strategy is goal oriented, so it helps business to achieve goal.

Competitiveness

Strategic management includes opportunities and threat analysis. So, it can help business to
maintain healthy completion in the market.

Resource allocation

It helps to manage human resources as well as economical and physical which includes raw
materials, property as well as machinery.

Flexibility
 Good strategy is always flexible. If plan A doesn’t work in business there is always plan B as well
as it can easily adapt or change according to time.

Long term sustainability

It helps business in long and smooth run and also plays major role in business succession.

Strategic Management Theories

1. Porter’s Five Forces

Porter’s Five Forces is developed by Michael Porter to analyze five different forces in Business.
They are:

Threat of New Entrants: it calculates how easily new competitors can enter existing market by fulfilling
existing required capital and new rules and regulations etc.

Bargaining Power of Suppliers: How much any suppliers have bargaining power over goods and
quality. More supplier, more competitive market.

Bargaining Power of Buyers: This is when buyers can influence market by either choosing quality over
quantity and also number of buyers determines trend in business.

Threat of Substitutes: There is always threat of alternative product having similar taste or character can
replace by lowering price or increasing quality of product.

Industry Rivalry: Market is always competitive among new startup’s, existing business with each other
on various factors like product pricing, profitability, quality and quantity etc.

Porter’s Five Forces: Porter’s five forces provide guides to understand external business environment.
Such as threats of intrants and substitutes, bargaining power of suppliers and consumer and market
rivalry.

2. SWOT Analysis
SWOT analysis contains the following:

Strengths: Analysis of internal capability of business. E.g. brand of business, skilled manpower and
goodwill of business.
Weaknesses: Factors affecting organisation like outdated technology and lack of resources.

Opportunities: External factors which helps in growth of company. Such as, new plans and policy,
favourable market conditions in emerging market.

Threats: Calculates eternal factors that can affect organisation like new competitors, economical
downfall or natural calamities.

SWOT Analysis: Swot Analysis provides insight of internal strengths and internal weakness as well as
external opportunities and external threats of business.

3. Resource-Based View (RBV)

The Resource-Based View is based on utilization of internal resources and capacity of firm to
achieve competitive success in long run of business. Resources must be following:

Differentiation: Product must be unique so that it is hard to find alternative or substitute.

Low costs: Resource must be cheap as much as possible than that of competitors.

High performance or technology: Organisation should have innovative and technological advantage so
it can perform at its best.

Quality: Quality should be high as possible so that resources become valuable.

Resource-Based View: It is based on individual organisational resources than that of common resources
available in market.

Conclusion
 Reference
Barney, J. B. (1991). The firm resources and sustained competitive advantage. Journal
Management, 17(1), 99-120.

Barney, J. B. (2018). Gaining Sources and related content