answer all question

CHAPTER 3 THE INTERNAL ORGANIZATION 109 Steven May/Alamy on specific routes, excessively low fares and even STRATEGIC FOCUS some provovative advertising slogans. The firm's core competence is the capability to maintain the lowest costs in the industry and to generate alternative reven- ues. Because of its very low fares, its passenger load grew at an annual rate of approximately 25 per cent until the economic crisis in 2008. The company even made profits in 2008, a very difficult year financially. All of this said, Ryanair receives a significant amount of criticism. In 2006, for example, it was voted as the least favourite airline (despite its popularity evi- denced in passenger numbers). It receives a large amount of criticism for its lack of customer service, with special focus on an unfriendly uncaring staff and LINE hidden charges. Yet, O'Leary believes that Ryanair may be one of the few airlines in Europe left standing after the latest severe economic recession. He is planning growth (although the airline announced some small reductions in service and staff in 2009) and is negotiating with Boeing and Airbus to buy as many as 400 new aircraft. The airline already is one of the largest in the world in terms of number of passengers served annually. With its decided strengths and also acknowledged weak- nesses, the future of Ryanair will be interesting. Ryanair: the passionate cost cutter that is both Sources: 2005 "Ryanair exercises options on five Boeing 737s", Wikinews, http://en.wikinews.org. June 13: Scott, M. loved and hated (2007) "Ryanair flying high", BusinessWeek http://www. businessweek.com. July 31; Davidson, A. (2008) "Michael O'Leary: Ryanair's rebel with a cause", The Sunday Times. Ryanair is the leading low-cost airline in Europe. It has http://business.timesonline.co.uk. December 7; Done, K (2009) "Ryanair in talks to buy 400 aircraft", Financial Times. achieved a high market share by relentlessly holding http://www.ft.com. February 2; Done, K. (2009) "Virgin and down costs and thereby offering the lowest prices Ryanair to cut jobs". Financial Times. http://www.ft.com. on its routes. To attract new customers, it once of February 12, 2009 "Ryanair Hidgs PLC". Answers.com fered flights for one penny to selected destinations. It http://www.answers.com. March 13: 2009 "Ryanair", Wikipe sold almost half a million tickets with the promotion. dia. http://www.widipedia.org, March 13. While Michael O'Leary, Ryanair's CEO, is known to be extremely cost-conscious (he will not provide em- Questions ployees with pens; he recommends that they get them 1 - Describe the differences between Ryanair's tangible from hotels where they stay overnight), the primary and intangible resources reason for Ryanair's lowest cost status is that it has the fastest turnarounds in the industry (resembling a 2- Use the value chain analysis to identify and evaluate race car pit crew operation). O'Leary is also constantly Ryanair's resources and capabilities. identifying new revenue streams such as charges for use of airport check-in facilities, charging for each 3- Define outsourcing and discuss reasons for its poss- ible use by Ryanair piece of luggage, offering rental cars at the destina- tion, charging to use the toilet on the plane, etc. To obtain free publicity, O'Leary or his executives often make outrageous statements and roundly criti- cize their competitors to get Ryanair's name in the news. The firm uses multiple marketing gimmicks such as advertising that directly criticizes competitors