Research Articles Base: Ryanair Case Studies

Ryanair Launch Strategy

Flight fares are always known to be overpriced.  This discourages traveling and usually leads to unnecessary expenses.  The added fees are supposed to make convenient the entire flight experience.  Ryanair intends to rebel against all of the said ‘free’ services.  It believes that every airline goal is to take customer from Point A to Point B with no questions asked.  Thus this is the No Frills Strategy where it cuts down on marketing costs, staff costs, airport charges, contracting out of services and fleet commonality (p. 843).  Ryanair itself is appalled of the high airline fares that has been dominating the Industry and boastfully asserts that traveling does not need to take so much money.  In fact the flight fares Ryanair offers cost as little as cents to none at all (excluding the taxes and other costs).  It truly serves traveling to the masses.  Coupled with its boisterous attitude led by its dynamic and arrogant CEO, Michael O’Leary, Ryanair does not only seek to reshape the airline industry but spark a campaign and revolution led by the low fare airlines as the best valued airlines while putting down the impractical overpriced airlines (by calling them as idiots among other derogatory callings, p. 851).  People willingly subscribe to Ryanair’s services which although inconvenient, have been proven irresistible because of the cheap airfare.   Ryanair does not focus quality but it promises to deliver which is the whole point of the transport business.  In this manner Ryanair becomes a frank, straight to the point, and a very practical alternative for airline solutions.  Customers are always looking forward to save money during flights and certainly they would not mind a business bare to its essentials especially if they will save as much as hundreds of Euros.  It is indeed a daring move which is made even more impressive because Ryanair is profitable, until the various external factors of 2004.  In a time of inflation, increasing interest rates among other costs, more and more customers would not mind risking convenience in plane travel at all.  Ryanair is made ideally for such a situation.       Credit:ivythesis.typepad.com

Ryanair Launch Strategy

Flight fares are always known to be overpriced. This discourages traveling and usually leads to unnecessary expenses. The add...

Ryanair Core Competence Case Studies

Ryanair Core Competence Case Studies

In almost anything a consumer does, whether she or he is an institutional buyer, industrial buyer or plain individuals, t...

Ryanair’s Future Success

To repeat: The lowest cost airfare is always sure to win the competition even in the direst, most intense circumstances.  This is a significant strength of Ryanair.  With its impressive cost management and outlook to increase more passenger seats and expand routes, Ryanair may come off just fine after the 2004 crises.  Ryanair knows how to anticipate difficult times due to increasing fuel prices and rivals and set their goal.  Bearing these segments and economics in mind, Ryanair must select routes carefully to generate enough traffic to fill the larger aircraft they use. Profitable markets must also have a large leisure-and private-travel component–the mainstay of the customer base of most low-cost carriers. A majority of these carriers follow the same basic rules, but with some differences in approach. Ryanair, which is as cheap as it gets, operates routes from London Stansted to many secondary airports–for example, to Carcassonne and Biarritz, in southern France, and to Pisa and Verona, in Italy. Low airport fees help keep the carrier’s costs 65 percent below those of a typical scheduled airline. Ryanair can thus offer cheap fares and still make a profit if more than 55 percent of its seats are occupied.  Thus it must proceed its goal in expanding to more little known routes and increasing more passengers in their planes while offering more premium services that the customers will end up purchasing for a more convenient flight.     References:     Abraham, M, Burgdorf, M, Dittoe, J. Scherf, H. Seydlitz, J. and Silver, B. 1997. Sustainable Development: Best Practices Manual. Build         Up Greater Cleveland, Cleveland.   Binggeli, U. and Pompeo, L. 2002. “Hyped Hopes for Europe’s Low-Cost Airlines: Europe’s Most Successful No-Frills Carriers Are Making a Lot of Money. but as They Mature, They Will Have Problems Expanding”. The McKinsey Quarterly   Harriot, P 2002. The Employer Relationship, Routledge, London   Kay, John A. 1993.  Foundations of Corporate Success: How Business Strategies Add Value. Oxford University, Oxford.   Krizek, K. J., and Power, J 1997. A Planners Guide to Sustainable Development. PAS   Report No. 467. American Planning Association, Chciago.   Maclaren, Virginia W. 1996. Urban Sustainability Reporting. Journal of the American      Planning Association. 62, 2 Spring: 184-202.   Petrovich, N. L. 1994. Introduction to Sustainable Development. Counties: Foundation for a Sustainable Future. National Association of Counties, Washington D.C.   Stapledon, G. 1996. Institutional Shareholders and Corporate Governance. Clarendon Press, Oxford. Credit:ivythesis.typepad.com

Ryanair’s Future Success

To repeat: The lowest cost airfare is always sure to win the competition even in the direst, most intense circumstances. This is a s...

Ryanair Company Case Study

Company Overview           Ryanair is the most popular and largest low-fare carrier in Europe. It started as a family business in 1985 with a 15-seater Bandeirante aircraft.  Today, Ryanair has 16 European bases across 22 European countries, flying 82 Boeing 737-800 and 9 Boeing 737-200 planes. Ryanair was named the most popular airline on the web for 2003 by Google and the most searched travel website in Europe (Ryanair, 2006). It has increased its passengers rapidly over the past ten years due to the popularity of low fare rates in European countries today. Ryanair Information Systems             The typical IS in most companies today are those that are used in accounting, HR and others. For airline such as Ryanair, online booking and flight management systems, two if the most critical functions of an airline are discussed.             Flight Watch is an operational system of an airline. It collects and displays vital information, such as passenger transfer information, booking figures, crew rotations, airport limitations, weather conditions and others (Qi et al). With its growing number of passengers, Ryanair launched its website in 2000, the www.ryanair.com which allows passenger to have their flights book online and avail of services which from Ryanair partners such as car hire, hotels, and travel agencies. Through the website, Ryanair was able to manage passenger information. In 2000, the company introduced a new host reservation system called Flightspeed which was operated by Open Skies. Ryanair and Open Skies developed the Takeflight System (Ryanair, 2002), an internet booking facility that allows internet users to access Ryanair’s host reservation system and to transact payment in real time via the Ryanair’s website. This system falls under the Transaction Processing System (TPS) and Decision Support System since it typically provides quantitative information such as the number of reservations and amount paid in a transaction as well as it serves a customer database wherein the company can analyze customer behavior and decides on the target markets. The data and information in this system is at the operational because booking and transactions are part of the operations system but at the same time, the customer database can be used to formulate strategies and set objectives. For example, Ryanair’s objective for this year is to increase its number of passenger by up to 25%, then basing on the customer database, they can set strategies to meet the company’s objective. The information in this system can be used in solving semi-structured problems.             Another IS in Ryanair is its Work Order and Flight Log Document Management System (“Increase Access to Information…” 2004) which is an integrated flight management schedule systems that support planning and operations department in planning schedules (QI et al). A flight management system allows a company record data of its pilots and decides on the flight plan. A flight management system has the navigational aid data base, airport database, the aircraft database and statistics like the number of flights for a day or a week.             This information system provides both qualitative and quantitative data as obvious with the data that are involved in the system. This system fits as a Decision Support System (DSS) because it helps Ryanair decides on the work order and scheduling its pilots depending on their qualifications and positions as well as on the aircraft that they will handle. Data and information in this system are use at the operational level and can be used in solving structured problems. Methods of Communication             Information systems like the Takeflight and the Work Order and Flight Log Document Management System used different method to be able to be communicated with the concerned and involved individuals.             The Takeflight System is an internet booking facility which means that it utilized the internet as a communication tool to stay in contact with the passengers and those who will inquire about booking and flight schedules. The process of communication is easy; a customer would simply log on at Ryanair’s website and follow instructions. With its website, Ryanair can also promote easily its services, special offers, discounts and privileges as well as promote its business alliance’s services.             Moreover, the information at the Work Order and Flight Log Document Management System is provided over the Ryanair Intranet, allowing Ryanair staff and employees to access, create and share critical information within the company. The information system also eliminated the use of paper, making communication and sharing of information time-saving. Flight management is a critical and essential airline function and must be well documented and shared properly. Conclusion             Ryanair, as reflected on their website, has been experiencing rapid growth in number of passengers. This only implies that its information systems are effectively working for Ryanair that the services they provided via its website as well as the coordination of flight schedules have resulted to customer satisfaction thus its sales increased as well as the number of loyal customers who opted to go for low cost airfare.   Credit:ivythesis.typepad.com

Ryanair Company Case Study

Company Overview Ryanair is the most popular and largest low-fare carrier in Europe. It started as a family business in 1985 wi...

Ryan Air: Ups and Downs : A Sample Term Paper

Ryan Air: Ups and Downs             Ryan Air was founded in 1985 by the Ryan family to provide scheduled passenger airline services between Ireland and the UK, as an alternative to the then state monopoly carrier, Aer Lingus. According to Doganis (2001) Ryan Air was the first low-cost, nor frills airline that had an impact on the European airline industry. When launched in 1985 ikt targeted the Irish ethnic market between Ireland and the United Kingdom by offering a more or less traditional type of service with a two-class cabin but at significantly lower fares. It stimulated a rapid growth of passenger traffic across the Irish Sea, much of it diverted from the sea ferries. On the London-Dublin route, where traffic had been stagnant for three years, passenger numbers more or less doubled in the next three years in response to the low fares introduced by Ryanair and to the lower fares forced on Aer Lingus and British Airways. But Ryanair was not profitable. Its unit costs, though lower than those of Aer Lingus, were not low enough to sustain its low fares strategy. By 1991 its accumulated losses amounted to close on (Sterling) £18 million and the airline was facing serious cash flow problems. It had also gone through five chief executives.               After a visit to Southwest Airlines in Texas in 1991 yet another new management decided to reinforce the low-fare strategy but to abandon all frills in order to reduce costs. It also moved its London base from Luton to Stansted airport, which was new and offered high-speed access to Central London. The new strategy slowly turned the company round and it recorded a small pre-tax profit in 1992. Subsequently traffic and profits grew steadily and in summer 1997 Ryanair was successfully floated on the Dublin and New York stock exchanges. In the financial year 1997-98 alone its profits rose by 51 per cent to US million. Ryanair’s sparkling financial performance was an encouragement to other European entrepreneurs to assess the low-cost, no-frills model as a way of entering European aviation markets.   Ryan Air’s Strategic Intent             Strategic intent concerns the direction in which a business id headed in the long term (Proctor 2000). The strategic intent of the firm is to maintain its leadership position in the low-cost airline sector. Leadership in the Low-Cost Arena             Ryan Air is considered as the largest low-cost airline in Europe. The company carries more or less 35 million passengers on 325 low fair destinations across twenty-one countries in Europe. The airline has 12 European bases, a large fleet that has more or less 250 aircrafts and more that 2700 employees. In order to maintain its leadership position in the low-cost sector, Ryan Air renders point-to-point services, cutting airport charges. Part of the strategic intent of the company is to maintain its leadership position by acquiring other companies. According to Michael Porter (1980; 1985), in order for a firm to maintain a sustainable competitive advantage, it must follow one of the three generic strategies. These strategies are: 1. Low-Cost – involves the sacrifice of some quality, fashion and even product innovation in order to keep costs low – the lowest in the industry (cited in Proctor 2000, p. 175). 2. Differentiation – focuses on the factors ignored by the low-cost strategy such as product variety, quality and service (cited in Proctor 2000, p. 176). 3. Focus – requires a firm to concentrate on a particular market segment rather than the overall market (Reid et al 1993).             The firm exemplifies most of the characteristics of a cost focus strategy. In order to keep the costs down, the airline maintains a no frills strategy. No frills is a direct approach to low cost which removes all frills and extras from a product or service. The goal is to generate a cost advantage that is sustainable for one of two reasons. First, competitors cannot easily stop offering services that their customers expect. Second, competitors’ operations and facilities have been designed for such services and cannot easily be changed (Proctor 2000).   Stakeholders and Their Importance             Stakeholders are the people who are affected by or can affect the activities of the firm. There are two types of stakeholders – primary and secondary. Primary stakeholders are those who have formal, official, or contractual relationship with the organization. The secondary stakeholders are other societal groups who are affected by the activities of the firm. This section identifies the major stakeholders of Ryan Air and how they are important to the firm. The stakeholders of Ryan Air are: <ul style="margin-top: 0in; margin-bottom: 0in" type="circle"> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Shareholders – the shareholders participate in distribution of profits, additional stock offerings, assets on liquidation, inspection of company books, election of board of directors and other rights established in the contract with the firm. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Employees – Employees are believed to be a source of competitive advantage. The knowledge, skills and abilities of the employees contribute to the success of the organization. In return, the employees expect economic, social and psychological satisfaction in the place of employment. The employees also expect freedom from arbitrary and capricious behavior on the part of company officials. The employees expect to share in fringe benefits, freedom to join union and participate in collective bargaining, individual freedom in offering up their services through an employment contract. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Customers – the customers are the source of the firm’s earnings. The customers purchase the firm’s products and services in exchange with satisfaction of needs, wants and requirements. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Suppliers – the suppliers are part of the firm’s value chain. In exchange with the suppliers products, services or expertise the firm is expected to be a source of business and facilitate a professional relationship in contracting for, purchasing, and receiving goods and services. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Competitors – competitors are also important stakeholders. They expect the company to observe the norms of competitive conduct established by society and industry.</li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Governments – the national government and other governmental departments are important stakeholders that have direct impact on the firm’s strategies. The government expect the firm to pay taxes, to adhere to the letter and intent of public policy dealing with the requirements of fair and free competition; discharge of legal obligations. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Local Communities – the local communities are also important stakeholders. The firm needs to participate in community affairs and to provide regular employment and support to the local government. </li> </ul>   Main Resources and Capabilities Resourced-Based of the Firm             The resource-based view presents a perspective of competition that portrays the value of a resource or capability as derived from the dynamic interplay of market forces. While the market and environment establish external constraints and pressures, a firm’s response through resource allocation and capability development become a source of competitive advantage (Boone and Ganeshan pp. 283-284). The resource-based perspective views a firm as an organization that has a bundle of protective resources and capabilities. Resources are tangible and intangible assets a firm uses to choose and implement its strategies. Capabilities are the skills a firm uses to bring its resources to bear.  The capabilities of the firm are: <ul style="margin-top: 0in; margin-bottom: 0in" type="circle"> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Lowest airfare rates</li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Simple processes (no frills)</li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Large brand awareness</li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Clear offer (focuses on particular market segment)</li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Innovative strategies on cost cutting</li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Quick turnaround time</li> </ul>   The resources of Ryan Air are: 1. Physical Resources – consists of the resources that are needed to operate such as aircraft fleet, headquarter, secondary airports. 2. Human Resources – the company has 2,700 employees. 3. Financial Resources – The financial resources of the company comes from the Ryan Family, shareholders, investors and creditors. 4. Intellectual Capital – these are the knowledge, skills, abilities and talents that every in Ryan Air possesses.   Sustainable Competitive Advantage             Ryan Air continues to be the lowest cost airline in Europe. The firm manages to maintain its cost leadership despite the presence of other low cost airlines in Europe. The source of competitive advantage of the company is its ability to drive down costs to sustain low fares while at the same time remain profitable. This is done through:       1. Fleet Commonality             The airline’s fleet is made up of Boeing 737, the most common aircraft being flown in the present. Because of fleet commonality the firm is able to cut on costs in obtaining spares and maintenance services. 2. Contracting Out of Services             Other than Dublin Airport where the firm maintains its staff and services, Ryan Air contracts out aircraft handling, ticketing, baggage handling and other functions to third parties. The firm is able to obtain competitive rates and multi-year contracts at fixed prices, limiting exposure to cost increases. Third [arty service outsourcing also limits Ryan Air’s Direct exposure to employee relations responsibilities and potential disputes. 3. Airport Charges and Route Policy             Airport charges include landing fees, passenger loading fees, aircraft parking fees and noise surcharges. In order to reduce these fees, the firm avoids congested main airports and chooses secondary and regional airport destinations which are very interested in increasing passenger throughput. 4. Staff Costs and Productivity             In order to control employee compensation costs, the firm implements a performance related pay structure. Although the company provides lower labor costs, the employees can earn additional pay or remuneration base on their performance.     5. Marketing Costs             In order to reduce marketing costs, the firm cut its rate commission to travel agents. The firm’s main advertisement tools are newspapers, radio, television and its company website.   Future Strategy and Recommendations Mergers and Acquisitions             Mergers and acquisitions have become one of the most important corporate-level strategies in the new millennium. Merger and acquisition strategies are important to firm growth and success in the 21st century (Hitt et al 2001). As Ryan Air continues to grow it is expected that the company will acquire other companies such as Buzz, in order to improve its capabilities and acquire more competitive advantage. Strategic Human Resource Management             Ryan Air, in its commitment to low-cost airfare have sacrificed its processes and services. The human resources of the company are not seen as a potential source of competitive advantage. The company do not seem to value its people. There is a growing belief that a company’s human resources is the most important source of competitive advantage. Human resources or the company’s people are one source of sustainable competitive advantage. In a fast-changing environment where technological innovations and other strategies can be copied, it is the human resources that bring a sustainable competitive advantage.   References Boone, T and Ganeshan, R (eds.) 2002, New Directions in Supply-Chain Management: Technology, Strategy, and Implementation, AMACOM, New York.   Doganis, R 2001, The Airline Business in the Twenty-First Century, Routledge, London.   Proctor, T 2000, Strategic Marketing: An Introduction, Routledge, London.   Porter, M 1980, Competitive Strategy, The Free Press, New York:   Porter, M E 1985, Competitive Advantage, The Free Press, New York.   Reid, G C, Jacobsen, L R and Anderson, M E 1993, Profiles in Small Business: A Competitive Strategy Approach, Routledge, New York.     Credit:ivythesis.typepad.com

Ryan Air: Ups and Downs : A Sample Term Paper

Ryan Air: Ups and Downs Ryan Air was founded in 1985 by the Ryan family to provide scheduled passenger airline services betwe...

New Dreame Operations Management Assignment

THE RYANAIR OPERATIONS  Ryanair’s operation, put simply, is just fast as Ryanair does nothing slowly to ease the customer’s progress through the service. The Ryanair service appears very efficient. The most striking part of the service is the speed at which the older 737-200 aircraft are turned around. It is here that Ryanair makes a difference with its aircraft, spending approximately 50 per cent of its time in the air compared with around 25 per cent for short-haul British Airways flights. The efficiency of the Ryanair service depends upon the effective execution of the turn around operation. (Aer Rianta, 1999) Failure to achieve this time can have a serious impact upon the low fare carrier’s schedule. A network carrier presently chooses to allocate between 45 minutes and one hour for an identical operation. The Ryanair turn around operations watched from the departure lounge have an inevitable look of chaos but nearly always result in the desired push back time being achieved. In choosing the 737-200 Ryanair have not simply chosen to buy older aircraft, but assets which are generally reliable and good for the quick turn around operation and takes five to ten minutes longer to turn around the newer 737-800. (BNP Paribas Equities, 2004)   In general, the approach taken by Ryanair is to: (Ryanair Conservative accounting policies, Davy stockbrokers, 2003) Ø      seek to reduce delays Ø      reduce the time taken at all stages of the operations Ø      to emphasise the importance of the airline’s presence to Dublin airport whilst negotiating airport charges The low level of charges paid to Aer Rianta by Ryanair allows the airline to break one of the “rules” of being a low-fare carrier in that it operates from a primary airport. In fact the charges for parking aircraft are so low that aircraft often fly in from overseas to park overnight. In common with Ryanair essentially wants to be left to move people around according to its own needs rather than in line with the airport’s needs. It can do this best through dedicated facilities and through controlling the speed at which each phase of the service is delivered. Recently, Ryanair made proposals to Aer Rianta to secure a long-term position at Dublin airport. The proposals ranged from the creation of a dedicated Ryanair terminal to the construction of a dedicated Ryanair pier at the existing terminal (Ryanair Conservative accounting policies, Davy stockbrokers, 2003) In essence, these airlines are not prepared to pay for the growth that may be necessitated by their own activity. In the past, both Emirates Airlines and Ryanair have threatened to move operations from their current hubs in disputes with the airport owners over the provision of facilities. Ryanair’s objective has been to establish itself as Europe’s leading low-fares scheduled passenger airline through continued improvements and expanding offerings of its low-fares service. Ryanair aims to offer low fares that generate increased passenger traffic. (Barter, 1992) A continuous focus on costcontainment and operating efficiencies is a vital part of the Ryanair way of doing things. Ryanair sells it seats on a one-way basis unlike most traditional carriers this change came into effect in November 2001. Ryanair sets its fares on the basis of the demand for particular flights and by reference to the period remaining to the scheduled date of departure. 70 percent of seats on a flight are sold at the minimum available fare assigned for the route, once these are filled the price per seat rises. (Barter, 1992) Ryanair provides frequent point-to-point service on short-haul routes to secondary and regional airports in and around major population centers and travel destinations. The average flight time has been 1.1 hours with an average route length of 746 kilometres in 2003. Ryanair’s flew an average of approximately 1.94 round trips daily per route. The choice of only flying short-haul routes allows Ryanair to offer frequent service, while eliminating the necessity to provide “frill” services otherwise expected by customers on longer flights (Mahoney and Pandian, 1992).   Point-to-point flying (as opposed to hub-and-spoke service used by the traditional carriers) allows Ryanair to avoid the costs of providing through service for connecting passengers, including baggage transfer and transit passenger assistance costs. This is one of the key differences between Ryanair and Emirates carriers. The fast turnaround is a key element in Ryanair’s efforts to maximize aircraft utilization. Ryanair’s average turnaround time for the fiscal year ended March 31, 2003 was approximately 25 minutes that allows Ryanair to not only save on costs but also adds tremendously to revenues. Management believes that Ryanair’s operating costs are among the lowest of any European scheduled passenger airline. (Civil Aviation Authority, 1998) There are four main expenses which Ryanair is able to control and/or reduce and therefore works hard to do so: (i) aircraft equipment costs; (ii) personnel expenses; (iii) customer service costs; and (iv) airport access and handling costs: (i) Aircraft Equipment Costs: Ryanair’s initial strategy for controlling aircraft acquisition costs was to purchase used aircraft of a single type, however this no longer became viable. Ryanair endeavours to control its labour costs by continually improving the productivity of its already highly-productive work force. Ryanair has entered into agreements on competitive terms with third party contractors at certain airports for passenger and aircraft handling, ticketing and other services that management believes can be more cost efficiently provided by third parties. (Civil Aviation Authority, 1998)   THE EMIRATES AIRLINE OPERATIONS  The experience of Emirates in developing processes to integrate sales, revenue management and schedule planning to achieve revenue objectives. The focus of Emirates has been in ensuring that the sales force is armed with revenue management acumen while pursuing revenue opportunities. There were difficulties faced by the various stakeholders in aligning their objectives towards the airline’s revenue objectives and the potential conflicts and hurdles they face in their day-to-day implementation. The solutions evolved in Emirates from 1997 have significantly sharpened its competitive skills, improved its internal synergies and enhanced its corporate IQ for better decision-making (Rosenberg, 2005). It has enabled Emirates to practice revenue management philosophy as an enterprise-wide competency instead of being a specialized proficiency. Emirates Airlines based in Dubai, is preparing to increase its initial order of 58 jumbo jets from Airbus and Boeing at a total value of 15 billion Euros. In comparison with Ryanair and other airlines that have suffered as a result of September 11, 2001 and the looming conflict in Iraq, Emirates has grown and is expecting to double its net profit and will announce its decision to increase its order as it stands, Emirates Airlines has ordered 22 Airbus A380, three A330, eight A340-600, and 25 Boeing 777 jumbo jets. (Rosenberg, 2005 p. 13)   In advance of introducing the Airbus A380 to its fleet, Dubai-based Emirates airline will deploy the Ultramain maintenance and logistics software as its primary management program to schedule and track maintenance tasks. The management of human factors within the multicultural environment of the Emirates Airline is reviewed with emphasis on safety procedures adopted in the Engineering and Maintenance division. A discussion of recent improvements in flight safety covers air safety reports, confidential data exchange, ground proximity warning system, traffic collision and avoidance system, quick access recorders, ground safety improvement program, crew resource management, and human factors and error reduction (Knight Ridder/Tribune Business News, 2005). Emirates is among the world’s fastest-growing, five most profitable and 20 largest international airlines. It is based in Dubai, a city that pursues an open-skies policy, with more than 110 airlines in free and fair competition. The airline operates services to more than 75 cities in 54 countries in Europe, North America, the Middle East, Africa, Indian subcontinent and Asia-Pacific, including two daily flights to New York’s JFK. Since its launch in 1985, Emirates Airline has received more than 280 international awards in recognition of its efforts to provide unsurpassed levels of customer service. The airline has experienced rapid and consistent growth, above 20 per cent a year on average and has been profitable for the last 17 years. (Knight Ridder/Tribune Business News, 2005) The airline plans to more than double its size by 2012. Emirates presently has 93 aircraft pending delivery, worth nearly US billion in list prices. This includes 45 Airbus A380s (two of them freighters), 25 Boeing 777-300ERs, 20 Airbus A340-600 HGWs, one A340-500 and two A310-300F freighters. Emirates announced the largest order in commercial aviation history at the 2003 Paris Air Show, when it added 71 new Airbus and Boeing aircraft worth US billion to its order book. It also was the first airline to order the revolutionary A380-800 double-decker and will be the main launch carrier for the innovative A340-600 HGW. Emirates airline was founded in 1985, it’s doubled in size every three to four years. (Hill, 2002) The carrier has been profitable for 18 consecutive years. The Maktoum family’s airline has prospered with fuel-efficient aircraft and a union-free workforce drawn from more than 100 countries. It’s made its reputation with a flair for promotion and amenities, such as private cabins in first class and 500-channel in-flight entertainment systems. The carrier has rapidly expanded its home airport, also under Sheikh Ahmed’s chairmanship, it is the key to Dubai’s strategy of becoming a well-heeled playground hosting as many as 50 million tourists per year. (Hill, 2002)  Sheikh Ahmed said the government invested just million to launch the airline, flying two planes between Dubai and Pakistan, and hasn’t put money into the carrier since. Long flights, low costs Despite whispers from rivals that the carrier must receive some form of continuing government subsidies, airline consultant Robert Mann credits the airline’s business model for its success. Put simply, Emirates flies large aircraft long distances, rather than smaller planes in a busy domestic network. “Emirates also gains a competitive edge over U.S. carriers through lower labor costs. Labor accounts for 20 percent of Emirates’ operating costs, while U.S. legacy carriers are saddled with payrolls as high as 42 percent of costs “absolutely unsustainable,” said Emirates executive vice chairman Maurice Flanagan. (Pitt and Brown, 2000) Emirates doesn’t gain any special advantage from working in the geographic center of the world’s oil supplies, said Mr. Flanagan. Emirates Airline relies on a consultant in Houston to cut down on its fuel costs. Working with Emirates’ fuel committee, the consultant was able to save the carrier 9 million last year. Emirates is building special terminals in Dubai and elsewhere that will unload both decks of the planes simultaneously. The company is talking with Boeing about orders for its new 787s, which are expected to be the most fuel-efficient airliners in the sky.   Emirates has consistently bucked industry trends to post record profits for the past 17 years. It is also investing in future growth with firm orders for 92 new wide-bodied aircraft including 45 super-jumbo Airbus A380s. Dubai grows at around 17 percent annually, and by 2010 it expects to have five million residents and some 15 million visitors. Emirates needs to be ready to support and tap into this growth, and that is why we are investing heavily in our fleet, in technology and support infrastructure, as well as in recruiting and training the right people.” To support its fast-expanding fleet, which increases by one new aircraft per month on average, Emirates is constructing a US3 million engineering centre and a new jet engine testing facility. When completed next year, Emirates’ engineering centre will be one of the biggest civil aviation maintenance facilities in the world with eight hangars fully equipped to handle heavy and light maintenance for the airline’s entire fleet including the soon-to-be-delivered A380 (Sull, Ghoshal and Monteiro, 2005). Sheikh Ahmed said: “The future looks bright for Emirates, with opportunities brought about by Dubai’s development as well as the steady growth in demand for air travel globally. We will continue to focus on innovation, quality and customer service; expand and strengthen our network to provide more air connections that will facilitate trade and tourism flows; and invest in advanced aircraft which are not only efficient to operate but will also allow our passengers to travel further, in great comfort.” (Sull, Ghoshal and Monteiro, 2005 p. 4).  Emirates has honed its skills and abilities to stay at the cutting-edge of customer service. It also challenges the airline to keep finding new ways of operating more efficiently while delivering a superior experience to its customers. Emirates will have launched services to a dozen new cities and increased frequencies to more than 30 existing destinations. (Sull, Ghoshal and Monteiro, 2005).Emirates operations as in comparison to Ryanair, never received direct subsidies or relied on government handouts. Dubai’s open skies policy granted foreign airlines the same access and privileges as Emirates. Competing under Dubai’s open skies policy from its onset toughened the fledgling carrier, and according to Flanagan “has helped us to become a carrier which can compete with the best of the world’s airlines”. (Sull, Ghoshal and Monteiro, 2005 p. 5) Much of Emirates’ success is due to the Al Maktoum’s sheikhdom’s ambitious strategy of reinventing Dubai as a modern hub of tourism and commerce in the Middle East. Emirates’ formula for success cannot be found in any management book. Its creativity in seizing opportunities and solving problems as they arise is the company’s strength. (Sull, Ghoshal and Monteiro, 2005).Emirates’ success has emerged from taking a non-traditional management approach, rather than relying on the industry’s conventional wisdom. Emirates is run like a family with, for example, an informal and entrepreneurial spirit. Emirates’ strategy of hiring from around the world confers economic advantages as well. The airline pegs staff salaries to the level common in their home country, which is often lower than wage rates in Europe.    FINDINGS  Emirates continued to grow significantly in the late 1990s, with ongoing but less dramatic reorganizations in the group. Surviving the perfect storm By not doing what other airlines do, Emirates has carved a niche for itself as a profitable, successful player that writes its own script, rather than copying what others do. (Pitt, 2000) The greatest test of the airline’s business model came in 2001 when Emirates, along with all other carriers, faced one of the most severe crises in the history of the airline industry: the September 11 terrorist attacks. But that was not the only challenge. (Doganis and Dennis, 1989) Emirates’ unique way of working appears to have paid off. In spite of the crisis in the industry, Emirates remained profitable. It did not reduce its workforce, as many other airlines did. It would have been forgivable to batten down the hatches, Sheikh Ahmed explains. ‘We could have slashed costs by announcing large numbers of redundancies as several other carriers did, and forget about our prognosis for another profitable year. But we did not. We did not make a single employee redundant, and paid salary increments in full’. (Doganis and Dennis, 1989) Emirates has become renowned for placing eyebrow-raising orders for new aircraft. Emirates operates one of the youngest fleets in the airline industry with an aircraft average age under four years old compared with an industry average of many years. (Mintzberg, 1983)  Executing on the global hub and spoke strategy will require Emirates to expand its route network as it is planning direct flights to San Francisco and Chicago, enabling flights from North America to the Gulf and Africa without changing planes in Europe and plans to double the number of planes operating from over 50 in 2005 to well over 100 in the year 2010. (Pitt and Brown, 2000) Management attempts to obtain competitive rates for such services by negotiating multi-year contracts at prices that are fixed or subject only to periodic increases linked to inflation. The development of its own reservations centre and internet booking facility has allowed Ryanair to eliminate travel agent commissions. Ryanair generated virtually all of its scheduled passenger revenues through direct sales, with direct telephone reservations and sales through Ryanair’s website respectively. (Pitt, 2000) Ryanair’s record of delivering a consistently high volume of passenger traffic growth at many of these airports has allowed it to negotiate favourable contracts with such airports for access to their facilities. Ryanair further endeavours to reduce its airport  charges by opting, when practicable, for less expensive gate locations as well as outdoor boarding stairs rather than more expensive jetways. Ryanair has not had a single incident involving major injury to passengers or flight crew in its 19-year operating history. (Pitt and Brown, 2000)   Although Ryanair seeks to operate its fleet in a cost-effective manner, management does not seek to extend Ryanair’s low cost operating strategy to the areas of safety, maintenance, training or quality assurance. Routine aircraft maintenance and repairs is carried out in house while currently contracting heavy airframe maintenance, engine overhaul services and rotable repairs to contractors, these contracts will be under review. Increasing aircraft and routes may prove the most straightforward aspect of scaling operations. Emirates must also attract the passengers to fill the planes. (Ryanair holding plc, 2002) Emirates managers hope to do this, in part, by passing part of the savings from their lower cost base on to passengers in the form of lower prices. The A380 is estimated to reduce fuel costs by 15 per cent versus existing long-haul aircraft, and Emirates managers plan to maintain their labour cost advantage. Emirates’ expansion will require an increase in the total staff to 35,000 by 2010. Emirates has earned a reputation for thoroughness, quality and consistency of service as the airline’s planned growth could strain its ability to provide consistent service quality and jeopardize its hard-earned reputation. Emirates has steps in place to ensure service quality while growing, including systems to track problems quickly, ISO certification for certain operations, and increased standardization of certain operations to ensure consistency.   Marketing and resource-based operations strategy of Ryanair and Emirates Airline involves certain assertions as developed in strategic management theory (Barney, 1986), that the resources and capabilities possessed by the airlines may have differences in relating to the process of operations that will include the ability of those airlines to sustained competitive advantage in the following way. There could be common marketing and resource operations that will not meet the best sources of competitive parity with the system in operation of Ryanair and Emirates Airline as the system will be the source of competitive advantage for the Airline industry. The marketing and resource-based condition of such strategies becomes important in understanding those airline carriers’ resources and capabilities will be sources of sustained competitive advantage in developing, and acquiring good operation ways as compared to other airlines that has an established strategy that does not imply that the only way to gain such advantages of those strategies (Porter, 1980) like through attempting to develop their own-based operations differentiation strategies as these may help implement a wide range of strategies in operations integration (Barney, 1996).    The issue of operations methods as a marketing requirement is dealt with in a manner and is focused on the issue of whether operations management will effectively interconnect the marketing and operations management functions that needs to be addressed within the context of Ryanair and Emirates Airlines (Sower and Motwani, 1997) as those airlines can be seen that synthesizing marketing and operations management is especially crucial in the service sector along with the presence of the customer in the entire Airline operating system that may be different than the marketing function which deal with the customers and Ryanair and Emirates will enable to identify the critical determinants regarding the degree in which the strategies perform safely in the marketing and operations activities independent on the airline mode of operations service processes in various areas (Pullman and Moore, 1999) and the focus is to apply those crucial strategies in valuing airline business factors that impact the degree to which their operations in marketing and resource-based operations strategies are uniquely managed in the process linking to the essence of strategies among different unit function of those airlines within the market demands and the particular materials being utilized in terms of providing better strategy management. (Priem and Butler, 2001)   Moreover, Emirates is no stranger to growing operations. Emirates has placed some big bets on Dubai, the A380 and its global hub-and-spoke strategy and its ability to scale operations as no one would confuse the airline industry with an easy sector to make money by having a good chance of continuing to defy the odds and succeed in a tough industry along with Ryanair. Credit:ivythesis.typepad.com

New Dreame Operations Management Assignment

THE RYANAIR OPERATIONS Ryanair’s operation, put simply, is just fast as Ryanair does nothing slowly to ease the customer’s progress ...

Internal Analysis of RYANAIR

Introduction             Modernity is the era of production characterized by the rise of industrial capitalism and the hegemony of bourgeoisie. Thus it centered on the production of commodities and products which in the Marxian perspective modernity becomes oriented with production and materialism.             On the other hand, Baudrillard interprets modernity as a process of explosion of commodification, mechanization, technology and market relations and further, characterized by an increasing differentiation of spheres of life. Since modernity characterized by industrial revolution leading to an era of production, capitalism acquired the powerful status in an economic system. Although the remnant of Marxist economy is still preserved in some communist countries, undeniably, the proliferation of capitalism as an economic system made the grounds for globalization of economic, cultural, and political spheres.             This significant condition became fundamental in the global economy wherein every capitalist thrives to advance their business tied in with the pervasive and effective strategic planning in order to adapt with such phenomenal change within the basic spheres of the society. Moreover, this rapidity affected the modernization of the society, wherein it pushes itself to the post modern ideology. Thereby our society today, as most of the scholars and researchers would put it, is on the verge of post-modernity.             In this case, let us examine the internal environment of Ryanair using different approaches and method to reveal its status and condition. Ryanair Airlines             Cathal and Declan Ryan founded the competitive Ryanair on July 1985 with the financial assistance of their father Tony Ryan. As a neophyte commercial carrier, its operations began with 25 staff and a single 15-seat Bandeirante turbo-prop flying between Waterford and London. Later on, regulatory authorities permitted the Ryanair Airlines to have at least four flying flights a day on Dublin-London route, now with more seating capacity. Now, Ryanair, with its rapid growth occupied a most sought position in its own field, being “Britain’s favorite airline”.   Resources and Capabilities               Resources and capabilities of any firms can be measured through identifying its tangible and intangible resources and capabilities within. Tangible and intangible resources are significant in implementing firm’s strategies. It ranges from financial, physical, technological and organizational; while intangible can be human, innovation and reputational assets.             Ryanair operates 74 aircraft including 41 Boeing 737-800 with 189 seating capacity, 21 Boeing 737-200 with 130 seating capacity, 6 Boeing 737-300 and 6 BAE 146 both are buzz fleet. Ryanair with 2500 personnel offers approximately 475 scheduled short-haul flights per day serving i84 locations in the UK, Ireland, and continental Europe. In the latest data gathered as of 2004, Ryanair carried 23 million passengers overtaking Easyjet airlines, declaring their being number one for passenger growth with 50% plus rate. Moreover, Ryanair has now 149 European routes and 11 bases and desire to increase its planes by 112 in the next ten years. VRIO – Value, Rarity, Imitability, Organization                         Ryanair Airlines (RA) valued the high service performance. The airline is known for its strict observance on punctuality, high rate of flight completion, and low baggage loss. It purchased modernized fleet which leads to less expensive maintenance with uniform brands used while high aircraft utilization strengthens its business and financial sheet. The rarity of RA based primarily on its strategic positioning and management operations. Its implementation on low fares service and high level of customer service delivery made RA strong and competitive compared to other firms in the same field. Other firms in the same industry hardly find their ways in imitating the same operations and strategic planning. RA produced effective planning and management operations in which lead others to imitate. Not all of the tangible and intangible resources like software, fleet designs, infrastructure, organizational culture, and knowledge management can be imitated. Causal ambiguity, time compression diseconomies and path dependencies are factors which affect the difficulty of other firms to imitate effective plans of successful firms like RA.             Systematic, healthy and good organization contributes much to the success of a certain business firm like RA. An organization with clear objectives and capable to draw everyone to work with these objectives will lead to firm’s success.     Value Chain and Action Plan             The analysis on infrastructure, human resource, technology development, procurement, inbound logistics, operations, outbound logistics, marketing and sales and service of RA provides us its value chain system. The low cost but quality training and limited crew help RA’s financial status grow. The opening of internet website brought significant financial figures in RA’s services while purchasing aircraft in one or two suppliers can decrease financial budget on procurement. Low cost promotion, free publicity, internet sales and yield management aid the marketing and sales operations.             The management’s action plan has two fundamental branches namely: the marketing plan and provision of service. The marketing plan covered product planning, price, place and promotion while provision of service is geared towards negotiations to suppliers and sub-contractors. Conclusion             The paper seeks to identify important factors in the internal environment of RA’s operations and management. The use of methods and instruments like resources and capabilities, VRIO framework, value chain, and action plan help us understand its operations within.             Furthermore, the bases of using the methods effectively offered more venues for growth and improvement within. Continuous analysis and examination of these internal factors can help support firm’s constant struggle for competition and economic growth. Whereas, proper use of instruments and employment of strategies are more important in order to achieve specific goals and objectives.   Credit:ivythesis.typepad.com

Internal Analysis of RYANAIR

Introduction Modernity is the era of production characterized by the rise of industrial capitalism and the hegemony of bourg...

In any contemporary operating organization progress that the company is making is recorded as basis for among a host of other essential things

Chapter 2 – Literature Review   2.1 Ratio Analysis In any contemporary operating organisation, progress that the company is making is recorded as basis for, among a host of other essential things, decision-making and as a benchmark for measuring the firm’s performance for the period under scrutiny. A financial situation analysis is one such yardstick that documents current and future financial situation in an attempt to determine a financial strategy to help achieve organizational goals. As formally defined by Riahi-Belkaoui in 1998, financial analysis ‘is an information processing system used to provide relevant information for decision making’ (p. 1). The main sources of information for such analyses are published financial statements of the concerned company. Various accounts from published financial statements are evaluated in relation to each other to form performance indicators, which are then compared to ‘established’ standards. These performance indicators are better known as ratios, and constitute the main tools of conventional financial analysis. Basically,(2004) mentioned that by calculating a relatively small number of ratios, it is often possible to build up a reasonably good picture of the position and performance of a business. In consideration to Oasis Airline, ratios help to highlight the financial strengths and weaknesses of a business, but they can not, by themselves, explain why certain strengths or weaknesses exist, or why certain changes occurred. Just by details investigation will find the reasons. Ratios can be grouped into certain categories; each of them identifies a particular aspect of financial performance or, position. There are five broad categories which define as follows: (1) Profitability; (2) Liquidity; (3) Financial Leverage; and (4) Asset Management (1999).   2.2 Industry analysis Airline industry is a complicated business, starting an airline company is not easy, it involves major capital requirements for aircraft, compliance of government regulations, restrictions and state policy, competitive reaction from other tourist transport and requiring high level of expertise to operate and manage. What is the airline industry problem that they have to face? Airline is facing the rapid increase of globalization, rising fuel prices, heavy repair and maintenances cost, raising labor costs, increasing competition and requirements for higher service levels and greater flexibility, budget airlines especially.   2.3 Definition of Competitive Advantages Competitive advantages is show a company sustains profits that exceed the average for its industry, how well that retain more customers than its competition, the firm can over its competitors and an ability to generate greater value for the firm and its shareholders. Michael Porter’s (1980, 1985) framework and typology: 1.                  Cost leadership 2.                  Differentiation             2.4 Critical Path Method (CPM)             This method was developed by E.l du Pont de Nemours and company in 1956 to aids them in the scheduling of some management works like routine plant overhaul, maintenance, and construction work.  Actually, this method is crucial to airline businesses since their work usually fall under repetitive operations of which the management has experience on data involving time and costs among others, and relatively small variance in their performance time, and CPM reasonably assumed that the completion time for each activity involved in a work project is known.  Moreover, the CPM incorporates no statistical analysis in its determination estimates. 2.5 For External Assessment Opportunities 1. Expansion to becoming a major carrier 2. Improving quantity of core customers 3. Possible partnership with other low cost air transport organisations 4. Marketing and business development through e-commerce, internet   Online booking are so popular recently, Oasis Hong Kong is easy to make their brand name become more and more famous. Besides, they need to introduce the B2B and B2C Business. In initially, Oasis Hong Kong has promoted the low cost fares for the ticket to the school graduation/rest, and providing them with the various kinds of support they need to become self assured on years of 2006 summer. However, Electronic commerce emphasizes the generation and exploitation of new business opportunities. Technological Advancement, Rapidly Growth of E-commerce Market, Online Advertisement and online booking can Generate Revenue are the other three opportunities that we should pay attention. E-commerce is often thought to doing business and using simply, fast and low costs refer to buying or selling using on the Internet. People would immediately think of consumer purchase. For the Online booking, Oasis Hong Kong can via their own celebrity to attract different types of commercial companies to advertise on their website. Moreover, rapidly growth of E-commerce Market is the suitable time to attract more new clients, especially the youngest to use their services.   Threats 1. Potential strengths of the new entrants in the low cost air transport industry 2. Unstable market places the company in danger of filing Chapter 11 claims  3. Increasing competition in e-commerce 4. Attack by substitutes, Time consuming & costly infringement, and Internet fraud complaints In opposites, we need to focus on the threats and try to make some improvements. Firstly, the most we worry about is there is strong competition in the current market. There are so many competitors as like Dragon Air, Cathay Pacific Airways, and budget airline including Jetstar, United Airlines and so on, although each airline has their potential customer. They need to face the strong competition and try to via the improvements to attract more clients. Besides, elements include substitutes, and the competitor, and so on. Payment in the Internet, it caused the problem on the tax, the revenue of internet sales may decrease, and especially it will affect the buyer. Attack by substitutes in a threat, Time consuming & costly infringement, and Internet fraud complaint are the other threats that we should pay more efforts to deal with. Many of the budget airlines work on a first come, they sell all the low fares first and don’t release any more closer to the date of departure. Therefore, the cheap fares advertised by budget airlines. At the same time, customers always complain which they can never get the fares online. For the attack by substitutes, Oasis Hong Kong should strength it’s characterized to keep their clients. They need to make an investigation on the complaint and give the feedbacks to their clients. Furthermore, in the whole process of trading, buyer usually don’t have any kind of receipts. Originally, almost all of airlines are having a market share, has than one more fares supplier in Hong Kong; therefore we cannot fulfill all the demand. People can select to buy budget fares or not, i.e. more airline company with promotional offers seasonal specials. 2.6 Internal Assessment Strengths 1 Strong language, culture and kinship 2 Strong reputation 3 Customer oriented 4 Strong community involvement 5 High technology 6 Strong in brand name 7 Unlimited innovation 8 High sales amount 9 Full skilled labor 10 Larger in local market share with long-haul 11 Online Advertisements can Generate Revenue 12 Rapidly Growth of E-commerce Market Based on the previous presentation of the external and internal assessment, Oasis Hong Kong is indeed on its way on becoming the dominant player in the industry. However, the road it has to travel is paved with obstacles and hurdles that will essentially test the company’s resolve. This is highlighted in the previous presentation analysis above. The company, regardless of its potential to be great, has some weaknesses that may cause their demise if not dealt with accordingly. This is compounded by the imminent threats to its operations as seen in the microenvironment of Oasis Hong Kong. However, the opportunities and strengths that the company have may well even out these perceived negativities as they outnumber them. Seeing that the company’s strength is built on their reputation, it seems that Oasis Hong Kong does implement a strategy that complements their environment. In the same manner, the previous presentation has given the impression that the internal environment of the organisation is able to contribute to this success. Thus, a balance in managing both internal and external environment may have been the redeeming feature of Oasis Hong Kong in the low-cost air transport industry.   Weaknesses 1 Relatively high price and high operation cost 2 Investment cost in high technology 3 Weak bargaining power of labor union 4 Financial stability 5 Internet fraud complaints 6 Strong competition in current market 7 Government impose tax on internet sales 8 Time consuming And costly infringement claims  Fares change all the time, with promotional offers for the opening of new routes, seasonal specials and so forth. Enterprises must make sure don’t miss any bargains, an example Oasis Hong Kong can sign up their customer on e-mail with any promotions from all the websites.   2.7 For Strategic Choices They are currently selling their travel tickets through their website, which can be accessed at www.oasishongkong.com. Although not in par with the websites of old-timers like Cathay Pacific Airways that is also Hong Kong-based, it seems to function pretty well and has all the basic information for its users. One outstanding characteristic of the website is that compared to other sites in the same line of business, it is remarkably uncluttered. Since the start of its operation, many have expressed skepticism in its success, as it has been proven that the economies of scale are not effortlessly shifted to the long haul model. If there is anything so far that Oasis Hong Kong has done right, it is the creation of a fair bit of coverage about its service and has reportedly endeavored to reach out to their market by permitting agents to register on the firm’s site to vend tickets. In October of 2006, they launched an online promotion (‘Be The First To Fly’) giving away more than 100 free flights between London and Hong Kong, as part of its first marketing initiative in the UK market[1].             Just this month, Oasis signed an agreement with Galileo GDS (a global travel distribution system), which allowed Oasis’ fares and inventory to be added to the Galileo GDS. As a consequence of the agreement, the carrier is supplied with a platform that permits the airline to examine online and offline total travel distribution. Also, Oasis will now be able to sell its tickets more effectively through Galileo’s wide-ranging exposure to agent locations. Consequently, Galileo-connected travel agents will have new opportunities to increase sales with new Oasis content available directly on their desktops[2]. Further, Oasis has outsourced contact centre services last year which will provide the carrier’s customers and travel agents with sales, general enquiries and customer service assistance, handling all inbound calls between 08:00 and 20:00 each day, seven days a week. They also have partnered with various hotels, car rental agencies, apartments and villas for the accommodation of their passengers, which was effectively incorporated in their website as one of the many conveniences of travelling with Oasis Hong Kong. As evidences to the effectiveness of their low-cost strategy, Hong Kong has experienced an 8.1% visitor increase last year, and a couple of airline operators (Air Asia and Jetstar) have introduced low cost long haul routes of their own, also last year[3]. Oasis Hong Kong Airlines claims to be committed to delivering nothing but the best of service, and as the passengers are the most fitting judge of their performance, the management asserts to looking forward to hearing from their customers regarding their flight experience with the carrier. And while they do not guarantee to reply to all feedback forms, they declare to welcome comments and offers assurance that they will be forwarded to the relevant department(s). From their original fleet of two Boeing 747-400s, the finalization of an agreement with All Nippon Airways Co., Ltd. to purchase three additional Boeing 747-400s, increased their fleet to five aircrafts. This was carried out just earlier this month as part of its planned fleet expansion in preparation for the launch of the airline’s new Vancouver route in the second half of 2007.   2.8 For Evaluation analysis As the airline is currently operating on one route only (Hong Kong International Airport to London Gatwick Airport), they have plans of expanding to other routes this year and the years to follow. Number one in their list of priorities is to be able to fly their growing number of loyal passengers to Vancouver International Airport, but negotiations to give license to fly to said airport is still on-going, subject to government approval. It is widely speculated that next in their priority list is the Oakland International Airport, and other airports that also route budget carrier hubs, like easyJet and Westjet. Oasis is also currently in the process of negotiations with Southwest Airlines and JetBlue Airways for potential partnership arrangements. The application for route licenses is currently going headstrong, as part of the carrier’s marketing strategy to fly to leading aviation hubs around  the globe. The main targets for expansion as of the moment are Cologne/Bonn, Berlin and Milan in Europe and Oakland (San Francisco) and Chicago in USA. Other aviation hubs in leading tourist-garners will follow after the said routes have been given licences, to further increase market scope for the company, in their intention to provide low-cost flying to more people. Also, like all other businesses in the same line of industry, Oasis has plans to participate in oil hedging to safeguard against potential fuel price increases. This is not only to maintain the low-cost fares being offered to passengers but also to be able to sustain business profitability. As Oasis has plans to break even during the first 12 to 18 months of operations, the said strategy will aid a good deal in its realization. Although the increase of tourism activity in Hong Kong is seen as a positive sign which will likely to continue in the following years, it is hardly comparable to the marked increase of the same activity in neighboring Asian countries. In fact, it is said by analysts that what the Hong Kong tourism industry is experiencing is just the tip of the iceberg.             Chapter 3 – Methodology 3.1 Introduction /Purpose In this part, we will rank and analyze the Oasis Hong Kong ability to create and maintain an environment in which budget airlines can compete. We assume Oasis Hong Kong operate in a wealth creation environment that enhances or hinders their ability to compete their business, based on analysis made by our own research project, the methodology is divides the national environment into 2 main factors: 1.                  PEST analysis 2.                  5-Forces Analysis Research Question: Are there any business opportunities available for airlines to invest the low-cost airlines?   3.2 Data & Information required Proposition There is a still business opportunity available for airlines to invest the low-cost airlines. The phenomenal success of budget airlines like easyJet, Virgin Atlantic Airways Ltd and Ryanair has revolutionized the travel industry. Between them, other budget airlines now can carry staggering passengers a year to destinations all over Europe. Why Oasis Hong Kong can’t? In this part, we outlines what the various budget airlines have to offer and recommends which destinations are any adverse effects to the company will occur if nothing to be done on the fact.   3.2.1. PEST analysis Political Conditions – political influences include government stability, taxation policy, foreign trade regulations and social welfare policies. Hong Kong is an attractive market for overseas eyewear makers and the newest trends. The opening of Oasis Hong Kong and the growth of long-haul market economy is supporting the demand for transportation services in Hong Kong. Oasis Hong Kong does not worry that the legislation could severely set back their most effective marketing. Hence, it has started flight to London from Hong Kong and thinks it can manage to avoid turbulence by keeping costs down and efficiency high. The political situation of Hong Kong is very stable now or even in the knowing future, all of these are provide by its stable and high visibility law. As the policy they adapted to the worldwide are in peace and free for development and easy to follow the market trend in major.   Social cultural – In a research conducted by AC Nielsen in mid January 2005, 25 per cent out of 1,016 consumers felt that their personal financial situation will improve in the next 12 months. Consumer spending has been grown to 11 per cent in the second quarter of 2004. The average spending on holiday travel will be HK,320. Subsequent to the Tsunami incident in South Asia on the past Boxing Day, the travel desires on Hong Kong people seemed to have softened with less than a third indicated plans to travel aboard, but 73 per cent of those claimed to be shifting to visit the Mainland China. Technological - Today, e-business has become an integral part of operations in the airline industry, with ultimate objectives of not only achieving cost saving but also generating additional revenue. Beyond to enhance their current product line, their further investment should be focus on improving and incorporating appropriate new technology. Two years ago, Oasis Hong Kong implemented and ambitious to become Asia’s leading e-business airline and the company is determined to provide greater ease and convenience for its customers and business partners—enhancing efficiency and economic benefits, as well as creating new opportunities for further business growth. The airline expects its e-business projects to significantly increase revenue, with 25-30 per cent of tickets being sold online by 2005. E-business is also expected to help cut operational costs by more than HK0 million a year by 2003, with substantial savings coming from the airline’s own online purchasing and reduced inventory. 5-Forces Analysis – Airline industry conducts more research and development (R&D) than any other industry because air transportation is dependent to considerable degree on the quality and performance of equipment produced for the airlines and airways operators, therefore R&D is a major long-term determine of national economic growth. Basically, the most dominant strategic management paradigm in recent years is known as the strategies model (Fredrickson 1991). Porter (1998) claims that the intensity of competition in an industry is neither a matter of coincidence or bad luck. Rather, competition in any business industry is rooted in its underlying economic structure and goes well beyond the behaviour of current competitors. With this, Porter’s 5-Forces Model is useful for understanding the context of the industry, in which the firm operates (‘Porter’s Five Forces’ 2006).  Distinctive Competencies of enterprise- Evaluation of the distinctive competencies of an enterprise is really vital to their development.  This evaluation serves as basis of strategies to be used in business procedures.  Thus, it is vital for the company to carefully assess the important features of this factor.   3.3 Approach                For this research design, the researcher gathered data, collated published studies from different local and foreign universities and articles from journals; and make an analysis of the collected documentary and verbal material.  Afterwards, the researcher summarised all the information, make a conclusion based on the results of evaluation and provide insightful recommendations on the dealing with the business practices of Oasis Hong Kong.                These gathered data and collated studies form and comprise the discussions of that this study is base on. This complements with the other data that the researcher gathered through the company news and reports. The information that is summarised and the conclusion that gained form these sources helps the researcher to have an idea of the magnitude of the sufficiency and criticality of business practice of Oasis Hong Kong.   3.4 Data Organization and Analysis As stated, this study utilised secondary data. Secondary data include raw data and published summaries, as well as both quantitative and qualitative data. Saunders et al (2003) deduced that secondary data fall into three main subgroups—documentary data, survey-based data, and those compiled from different sources. On the other hand, the study used news and company reports to gather primary data. Basically, these are called documentary secondary data.             Documentary secondary data, accordingly, are the ones often used in research projects that also use primary data collection data methods, although such data can also be used on their own or be combined with other secondary data. This type includes: written documents (notices, correspondence, minutes of meetings, reports to shareholders, diaries, transcripts of speeches, administrative and public records, as well as articles from books, journals, magazines and newspapers) that can be important raw data sources on their own right, a storage medium for compiled data, provide qualitative data, and can be used, as well, to generate statistical measures (e.g., data on absenteeism derived from company records); and, non-written documents (like tape and video recordings, pictures, drawings, films and television programmes, digital versatile disks and CD-ROMs) that can be analysed both quantitatively and qualitatively, as well be used to help  triangulate findings based on other data such as written documents and primary data collected through observations, interviews and questionnaires (Saunders et al, 2003, pp. 190-191). From the gathered past studies related to status of Oasis Hong Kong buisiness practice, this study employed an analysis since this study involves gathering information by examining records and documents. In addition, the documentary data discussed in this paper are often used in research projects.  Research based almost exclusively on secondary data is termed archival research and, although this term has historical connotations, it can refer to recent as well as historical documents i.e. review of related literature (Bryman, 1989).   3.5 Difficulties and Limitation of the research This dissertation looks at some of the variables that affect particularly those under the control because the data should be corrected in the same period, much, found more related books. From this foundation, it continues with a summary of techniques used in the design, as like how to write a research paper. Moreover, knowledge problems and tackle difficulties in time limited. The research should be preceded in the form of more detailed studies.             Chapter 4 – Findings Data classified on the basis of intervals of time constitute vital information in the control of business activity, since this is the most effective method of showing the changes that are taking place in a business, an industry or in total economic activity.  Closely related to the problem of measuring changes in business activity is the making of forecast of future activity.  The management of operation requires a continual making of decisions regarding the future and the basis for such forecasts is the record of the past performance. When observations of this kind are arranged in a time sequence and separated by (or represent) more or less regular intervals of time (months, years, decades, etc.), the progression of values is known as a time series.  The concept of trend in economic time series rests in large part upon the secular growth of population, capital and resources.  On the other hand, this work attempts to determine and analyse the business operation of Oasis Hong Kong in accordance to their strategies in the Airline market. These days, everyone talks about the virtues of interactive marketing and building long-term relationships with customers by relying on websites, call centres, and bricks-and-clicks integration. We all know there is a compelling case for treating different customers differently and focusing on “share of customer” as a metric of success. To some of us now, it seems that this new world of competition was created entirely from the development of a newly available Internet technology, or that it was simply imagined out of the thin air of entrepreneurial drive and business guru creativity. With this regard this part of the chapter, will be divided into several categories: (i) intensity強烈of competitive rivalry, (ii) new entrants’ status, (iii) evaluation of the bargaining power of customers, (iv) evaluation of the bargaining power of suppliers, (v) evaluation of the threat of substitute products, and (vi) summary.   4.1.   To analyze and assess whether the intensity強烈of competitive rivalry競爭;對抗is not keen a.        power of buyers b.        power of suppliers c.         threat of new entrants d.        threat of substitute products e.         industrial growth f.          industry overcapacity g.        exit barriers h.         diversity of competitors i.          informational complexity and asymmetry j.          brand equity k.         fixed cost allocation per value added l.          Overall assessment     4.2.   To analyze and assess whether the threat of new entrants is not strong a.        the existence of barriers to entry b.        economies of scale c.         proprietary product differences d.        brand equity e.         switching costs f.          capital requirements g.        access to distribution h.         absolute cost advantages i.          learning curve advantages j.          expected retaliation k.         government policies l.          Overall assessment   4.3.   To analyze and assess whether the bargaining power of customers is weak a.        buyer concentration to firm concentration ratio b.        bargaining leverage c.         buyer volume d.        buyer switching costs relative to firm switching costs e.         buyer information availability f.          ability to backward integrate g.        availability of existing substitute products h.         buyer price sensitivity i.          price of total purchase j.          Overall assessment   4.4   To analyze and assess whether the bargaining power of suppliers is weak a.        supplier switching costs relative to firm switching costs b.        degree of differentiation of inputs c.         presence of substitute inputs d.        supplier concentration to firm concentration ratio e.         threat of forward integration by suppliers relative to the threat of backward integration by firms f.          cost of inputs relative to selling price of the product g.        importance of volume to supplier h.         Overall assessment   4.5.    To analyze and assess whether the threat of substitute products is weak a.        buyer propensity to substitute b.        relative price performance of substitutes c.         buyer switching costs d.        perceived level of product differentiation e.         Overall assessment 4.6.    Summary     Chapter 5 – Discussion/Analysis   5.1. To verify whether the intensity of competitive rivalry is not keen 5.2. To verify whether the threat of new entrants is not strong 5.3. To verify whether the bargaining power of customers is weak 5.4. To verify whether the bargaining power of suppliers is weak 5.5. To verify whether the threat of substitute products is weak   Chapter 6. Conclusion (Referring to the section 1.4, 1.10, 3, 4 and 5.) 6.1   Summary of Objectives to have achieved 6.2   Implication of the findings and the fact (referring to the section 1.4, 4 .1- 4.2 and 5.2) 6.2.1.  Consequence or effects to the company if nothing will be done on the fact 6.4.   Future expectation 6.3   Limitation of the study   What are they???? Epilogue   Appendices Bibliography     Credit:ivythesis.typepad.com

In any contemporary operating organization progress that the company is making is recorded as basis for among a host of other essential things

Chapter 2 – Literature Review 2.1 Ratio Analysis In any contemporary operating organisation, progress that the company is making is ...