One useful way of analyzing the nature of competition in an industry has been suggested by Porter's ' five forces model of competition . Discuss Porters five forces model . Relate your answer to Ryanair . Operations strategy at RyanairThe two most important attributes of any operations strategy are firstthat it aligns operations activities with the strategy of the wholeorganization, and second that it gives clear guidance. Here is anexample of a business which meet this criteria.Ryanair is today Europe's largest low-cost airline (LCAS) andwhatever else can be said about its strategy, it does not suffer fromany lack of clarity. It has grown by offering low-cost basic servicesand has devised an operations strategy which is in line with itsmarket position. The efficiency of the airline's operations supportsits low-cost market position. Turnaround time at airports is kept to aminimum. This is achieved partly because there are no meals to beloaded onto the aircraft and partly through improved employeeproductivity. All the aircraft in the fleet are identical, giving savingsthrough standardization of parts, maintenance and servicing. It alsomeans large orders to a single aircraft supplier and therefore theopportunity to negotiate prices down. Also, because the companyoften uses secondary airports, landing and service fees are muchlower. Finally, the cost of selling its services is reduced wherepossible.Ryanair has developed its own low-cost internet booking service. Inaddition, the day-to-day experiences of the company's operationsmanagers can also modify and refine these strategic decisions. Forexample, Ryanair changed its baggage handling contractors atStansted Airport in the UK after problems with misdirectingcustomers' luggage. The company's policy on customer service isalso clear. "We patterned Ryanair after Southwest Airlines, the mostconsistently profitable airline in the US,' says Michael O'Leary,Ryanair's Chief Executive. 'Southwest founder Herb Kellehercreated a formula for success that works by flying only one type ofairplane – the 737, using smaller airports, providing no-frills serviceon-board, selling tickets directly to customers and offeringpassengers the lowest fares in the market. We have adapted hismodel for our marketplace and are now setting the low-fare standardfor Europe. Our customer service,' says O'Leary, 'is about the mostwell defined in the world. We guarantee to give you the lowest airfare. You get a safe flight. You get a normally on-time flight. That'sthe package. We don't, and won't, give you anything more. Are wegoing to say sorry for our lack of customer service? Absolutely not.If a plane is cancelled, will we put you up in a hotel overnight?Absolutely not. If a plane is delayed, will we give you a voucher fora restaurant? Absolutely not.

Porter's Five Force Model is was developed by Michael Porter in the year 1979. Basically it is a…

One useful way of analyzing the nature of competition in an industry has been suggested by Porter's ' five forces model of competition . Discuss Porters five forces model . Relate your answer to Ryanair

One useful way of analyzing the nature of competition in an industry has been suggested by Porter's ' five forces model of competition . Discuss Porters five forces model . Relate your answer to Ryanair

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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