Wednesday, April 9, 2014

Ryanair: An infamous low cost strategy


While reading the Southwest Case study and the article “Types of Strategy: Which fits your business?” where it is being analyzed the low-cost leadership strategy, it immediately came to my mind Ryanair, a European low cost airline. We could say that Ryanair is the European Southwest but with one main difference. Ryanair has strategically decide to follow a strict low cost leadership strategy which strategically ignore focus on anything else like culture, customer service or corporate responsibility. Thus, Ryanair can claim that it has the lowest fares in the European market, around 50% less than its competitors, but it is one of the most infamous European airlines. Some of the negative publicity in the media includes troubled employment relationships, very poor customer service, unfair charges for services like the use of credit card and even safety concerns. 

Can a strategy like this remain sustainable in the future and what is the border of the ethical side of a low cost leadership strategy?

Following is the link of the article “Ryanair: the spectacle of business without trust” by Zoe Williams posted in Guardian, stating Ryanair’s unpleasant side:

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