Strategy is an important factor to all organizations since it gives direction for the organizations on which route they should take in order to success. Strategy can be seen as effective long-term plans that guide organization to achieve their goals or objectives and to remain competitive advantages in the industry. Generally, strategy has been variously defined by different authors as being driven by either “inside out” – Resources Based View or “outside in” – Positioning view, or so called Market Based View. Ryanair’s strategy which gave them competitive advantages and competitive position can be analyzed through these two different perspectives of strategy.
In the business world, firms compete with other firms, in this sense one business idea competes with the business ideas of competitors, some survive and some do not. In the market for cheap flight airline, Ryanair have succeeded but others have not. This is mainly because the “idea” of Ryanair which Chief Executive Michael O’Leary simply adapted from the Southwest Airlines’ business model to the European environment – the low-budget airlineworks for them. Ryanair’s model of low-budget airlinewhich passes its costs directly to its customers in order to maximize profit had leaded them to the profitable route of success. It is the integrated business strategies which combines resources-based view and positioning view that added value to Ryanair and help them to achieve the significant result in the cheap-flight industry by leveraging its competitive advantages and competitive position. Ryanair’s core competencies are the variety of destinations and routes they serve within the continental Europe, the rapid amount of flight and sufficient capacity. Ryanair serve variety of destinations and routes which increase their market share and had become one of the major core competencies for them to sustain competitive advantages.
Besides, Ryanair also benefit from its streamlined operationwhere in Management Today Michael O’Leary reveals that where BA operates 6 flights, Ryanair operates 8. This represents an efficient gain of one third, straight out of the block. These rapid amounts of flight provide core competencies for Ryanair since they can maximize the amount of customers they serve daily by fully utilizing its capacity which their competitors found it difficult to imitate which provide them with more competitive advantages. The exploitation of capacities of Ryanair ensures them with sufficient capacities to serve the expanded routes and increased passenger volume and maximized their profits which create a strong core competence for them to stay strong in the cheap-flight industry.
In conclusion, the low-cost airlines which utilize the cost-leadership strategy to create a competitive position, as well as strengthening its core competences and capacities to increase performance had help Ryanair to achieve its significant achievement. Thus, by looking at the core competence and competitive advantages of the organization, Ryanair remain its competitive position in the cheap-flight industry and have optimist future for expanding further.
