Introduction to Ryanair Airlines
Ryanair Airlines is a low-cost or budget airline which was founded in the 1984 and has its headquarter in Swords, Dublin, Ireland and the primary base of the operations are located in London and Dublin mainly. The organization was named as the largest airlines in Europe and has carried the most number of international passengers than any other airlines organization. Ryanair has been operating greater than 400 Boeing aircrafts and has a backup and training is also provided to the pilots. The company is characterised by the rapid speed of its expansion which is a result of the deregulation of aviation industry in entire Europe in the year 1997. The network that has been created by Ryanair serves more than 30 countries in Europe, Middle East and Africa (Ryanair.com. 2018). The organization has been successful in growing after its establishment in the year 1984. Ryanair has shown a growth from a small airline organization to the airline based service provider in Europe. The revenues of the company have seen a rise from 231 million Euros in the year 1998 to around 1843 million Euros in the year 2003.
The analysis in the report will be based on the issue that had been faced by Ryanair in the year 2016 due to the massive cancellation of flights by the management. The reasons for the occurrence of these issues based on the leadership of the organization will be analysed in the report.
The CEO of Ryanair Airlines Michael O’Leary has been considered as a successful leader with respect to the functions that have been performed by him to improve the operations of the company in the industry. The rapid growth of the organization has been based on the effective leadership that has been depicted by the CEO and ways by which he was able to manage the workforce. The leader of the company has provided his massive efforts which were related to its conversion to a profitable entity in the market. The personality of the CEO of Ryanair has been quite controversial in nature which is related to the various wrong steps that have taken by him in the course of the operations of Ryanair in the industry (Arnold et al. 2015). The major issue was faced by the company in the year 2016 which was due to the cancellation of flights. This main reason behind this has been the lack of enough workforce due to huge number of leaves taken by the pilots. The leadership of Michael O’Leary can be analysed based on different theories to understand the ways by which the company has been managed by him.
Leadership Style of Michael O’Leary
This theory mainly assumes that the leadership characteristics and the abilities of the leaders are inherited. This assumption proves to be true for the leadership style that has been followed by Michael O’ Leary. The family to which the leader of Ryanair belongs has been showing effective qualities of leadership. Timothy O’Leary, father of Michael O’Leary is the major reason behind the leadership traits shown by Michael O’Leary. Michael’s father was a businessman and had successfully set up his businesses in various industries (Bellamy and Bellamy 2016). Timothy was a type of leader who considered himself to be the best and most knowledgeable about the processes that take place in the organization. Michael was able to transform Ryanair to a successful company within a short period of time. He had a strong drive related to the responsibilities that he had regarding the organizational processes. Michael had driven the profitable growth of Ryanair by increasing the standards of the fleet that was managed by the company. The leader was focussed on completing the tasks that are related to the growth of the revenues of the company (Buble, Juras and Mati? 2014). Michael however did not possess the trait which deals with integrity and honesty. The training that is provided to the pilots of Ryanair are not done by the company and it is based on an agency which completes their training related to the different processes. The company also had to face criticism due to the policy which led to deliberate high turnover of the staff. The trait theory is not enough to analyse the traits that have been depicted by Michael O’Leary as the CEO of Ryanair Airlines. The issue that was faced by the company in the year 2016 will be thereby discussed based on the other relevant theories of leadership (Calder 2018).
Michael O’Leary has been identified as a transactional leader due to the reward policies that are followed by him to manage the employees and further improve their performance as well. The payment that is provided to the employees are based on their performance. The cabin crew of the airlines also receive commission for selling goods within the flights. The staff also owns 130 million shares within the organization and incentives are provided for increased productivity. The compensation that is provided to the flight attendants comprises of the salary and the incentives provided for the efficiency that they show in their performance in the organization (Choi, Kim and Kang 2017). The management has also been trying to improve the rosters of the employees so that their productivity can be maximised and they can also be provided with the maximum time off from work. Ryanair expects its employees to perform in a better way in return of the incentives and the rewards that are provided by the company. The transactional style of leadership is suitable when the organization operates in a stable environment. Ryanair has however been able to maintain its topmost position in the market in the environment of economic slowdown that has taken place in Europe. The increase in the prices of fuel has also not been able to decrease the profits that has been gained by the organization in the market. The control over the various organizational processes that has been shown by Michael is related to the traits of a transactional leader (Davies 2018).
Transactional Leadership of Michael O’Leary
The CEO of Ryanair Airlines also possesses some of the major characteristics that are related to transformational leadership. The company did not have a clear vision regarding their performance and in spite of this the organization has claimed the second position in the airlines industry within a short period of time. The organization continues to innovate its processes and bring changes in the front and the back ends of the business. The organization has taken many creative initiatives to attract the publicity in the media and increase its awareness among people. Michael has been able to build effective and efficient teams and he is the major reason behind the huge success of Ryanair in the industry (DuBois et al. 2015). The leader has also introduced low cost model of business to sustain the operations if Ryanair in a profitable manner. The air transport industry of Europe has been transformed completely by Michael in a single-handed manner. Michael however lacks the abilities that are required for qualifying as a charismatic leader. The CEO of Ryanair airlines has however not been able to satisfy the needs of the employees in a sensitive manner. The issues that have occurred in the organization based on the payment of their uniform, meals and training related activities (Graham 2018). The leader has also depicted insensitiveness to the external environment in which the organization has its operations. Michael also has a negative reputation regarding the ways by which the management interacts with the suppliers and the customers. Michael has thereby depicted the ability of an effective leader due to the various traits that have been identified in his leadership style. The unique style of leadership that has been depicted by Michael is based on two major styles which include, transformational and transactional leadership (Green 2018). The aggressive style of leadership that has been shown by Michael has proved to be effective for the operations of Ryanair airlines. The effectiveness of his leadership style is related to the huge growth that is shown by the company within a short span of time.
The organization has however faced many issues which were related to the lack of effective leadership by the CEO Michael O’Leary. Ryanair Airlines has been able to gain the topmost position in the market with the help of the huge growth that has been shown within a short span of time. The company started facing issues based on staffing and financial health from the year 2016. The low-cost airlines service had attracted a huge customer base for the company and further pressure was created due to the increasing demands of the consumers (Kang, Solomon and Choi 2015). The financial health of the organization and staffing related issues have proved to cause huge difficulties for Ryanair Airlines. The lack of enough employees for the purpose of providing the appropriate services to customers was a major issue that was faced by Ryanair Airlines. The other issues in the company include, the leakage of documents, regulations related to aviation industry. The two major reasons behind the issue of cancelled flights of Ryanair Airlines are limitations based on flight time and annual holidays. The increase that is experienced in the demands of the customers were based on the troughs and the peaks (Keskes 2014). The demands are found to increase at the time of Easter and the beginning of September. The airlines are able to make the most amount of profits during the peak time. The formation of rosters by the members of the management is the major factor that enables to deal with the situation of the lack of employees. The allocation of holidays to the pilots has always proven to be a tricky issue at the demands increase between the peak time of Easter to the end of August. The pilots are thereby encouraged to take the maximum number of leaves between the time period of September to March (McCleskey 2014). The FTLs or the Flight Time Limitations further add to this issue related to the successful allocation of hours of work to the pilots. The complexities that were related to the working hours of the pilots have been the major reason behind the issue that led to the mass cancellation of the flights. The new rules that were implemented by the Irish Aviation Authority related to the usage of calendar year for the leave allocations had caused huge complications in the entire process. The management was unable to integrate the laws with the systems of the organization in an effective manner (Mittal 2015).
Transformational Leadership of Michael O’Leary
The managers were unable to allot the leaves to the pilots according to the requirements during the months of July and August. The airlines were in fact having a surplus of pilots during this period of time. The changes in the policies of the airlines were implemented after the regulation was formed by the government. The pilots were however not willing to work according to the changed leave schedules of the airlines. The anger that was created among the pilots further led them to take bulk leaves at the same time. The airlines did not have the enough workforce for the purpose of continuing its operations in the month of September 2016. Ryanair airlines has been famous in the market for the low cost services that it provides to the consumers (Monzani, Ripoll and Peiró 2015). The company operated around 2200 flights in a day. The lack of staff thereby led to the huge cancellation of flights of Ryanair airlines. The failure that was faced in the operations of the company due to their inability to operate the adequate number of flights further led to different types of rumours in the industry. The company started losing its reputation and the rumours were spread related to the deteriorating financial health (Saeed net al. 2014).
Ryanair Airlines had to however face massive issues due to the cancellations of the various flights from the month of September till about the end of October in the year 2016. The employees are biggest assets of various organizations irrespective of the industries to which they belong. The work culture and the leadership of company is responsible for maintaining the satisfaction levels of the employees. Ryanair is considered as a low-cost airline which was established by the Ryan family. The organization was not able to earn profits in its initial five years of operations. However, the airlines saw huge growth in profits after the appointment of Michael O’Leary as the CEO of Ryanair (Sethuraman and Suresh 2014). The change in leadership of the organization affected the profitability and revenues in a positive manner. The culture of the organization was mainly based on the vision which was related to the low-cost services provided to the customers. The CEO applied many cost-cutting initiatives so that the environment of the company reflects the culture and the strategy that is followed by them. The staff of the organization had to face many cost-cutting related steps that have been taken by Michael. The culture of Ryanair and the leadership of Michael O’Leary affected the stakeholders of the organization (Williams 2017). The major stakeholders were considered to be the customers and the employees. The customers were not provided with any value added benefits and the employees were also not provided with benefits like, uniform, health and others.
Issues faced by Ryanair Airlines in 2016
The culture of the organization was developed by Michael O’Leary in an effective manner. Michael had proved to be successful leader which is related to the huge improvement that has been seen in the profitability of Ryanair Airlines within a short span of time. The leader has a hard headed attitude towards the services provided to the customers. The company is known in the industry for providing the lowest fares to the consumers. The leader is however known in the airlines industry for his negative attitude towards the consumers. The leader believes in providing the customers with whatever they want (Yahaya and Ebrahim 2016). The company has never given much importance to the complaints that were raised by consumers regarding the services that were provided to them. The view of the management towards the customers has been that they have no right to complain as they are being provided with the lowest prices. The leader also believed in talking to the point with the employees and the stakeholders. The cost-cutting related initiatives that have been taken by the management have been helpful for the successful operations of the company (Zhang, Cao and Wang 2018). Michael did not believe in the concept of bad publicity and he did not care about the various rumours that flow in the market regarding the operations of the organizations. The leader has been defying the laws related to the concept of good leadership. However, he has been successful in increasing the profitability of the organization in an effective manner.
The airlines had to face a major issue in the year 2016 due to lack of effective management of the leave allocation related activities of the pilots. The organization had to face mass cancellations due to the shortage of workforce in the months of September to October 2016. The collaboration of the employees and the management has not been adequate in Ryanair Airlines. This has led to the wrong allocation of leaves to the various pilots, which had led to huge losses of revenues and reputation of the company (Zhang, Cao and Wang 2018). The pilots had taken their due leaves of the year together and this has further led to the huge shortage of the employees and flights were cancelled. The pilots were then offered bonus of about 12000 Euros to the pilots to bring them back to duty. However, they had rejected the amount and refused to return to work as well. The relationship of the leader and the employees has not been effective in nature which has been the major reason behind the issue that had been faced by Ryanair Airlines. The organization was able to continue its profitable operations due to the low prices that it offered to the customers (Williams 2017). However, the cost-cutting initiatives taken by the airlines were not accepted by the employees in a positive manner. The work culture of Ryanair had been hugely blamed due to the loss of the employees at the same point of time. The airline industry was responsible to tackle the issues that are occurring with the employees and ways by which the revenues of the organization are affected. The scheduling related activities of the organization need to be improved and the management needs to change its ways of operating with the employees (Ryanair.com. 2018). The perfect management of time slots of the employees can be helpful and beneficial not only to the organization, it will also benefit the employees. The leader further needs to collaborate with the employees and understand their needs to formulate the appropriate strategies that are related to their schedules of work. This will be helpful in the effective management of the employees and their working times (Yahaya and Ebrahim 2016).
Allocation of Leaves to Pilots
Conclusion
The report can be concluded by stating that the issue that was faced by Ryanair Airlines in the case study is related to the lack of proper management of the leaves that are allocated to the pilots. The leader of the company has been able to take Ryanair Airlines to an all new level of excellence. However, the style of leadership followed by Michael did not help in building strong relationships with the customers and the employees as well. The various steps taken by Michael related to the cost-cutting based initiatives of the company were not liked by the employees. This had led to many issues which were faced by the operations of Ryanair Airlines in the industry. The company also had to face huge criticisms for the massive cancellation of flights due to the shortage of enough pilots in the workforce. The blame of this issue was taken entirely by the management of the organization
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