The type of childcare had little impact on infection risks. Advantages of Choosing In-House. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. And the government has said the second of these has to be a more accurate PCR test, which can cost as much as 219 ($302) per passenger. And the company continued to insist it saw the opportunity for wins amid the travel industrys carnage: Europes legacy carriers were hurting even worse than EasyJet, which offered the discount airline a chance to gain new flight slots at key airports in Paris, Milan, London Gatwick, and Geneva. 1 or No. Significant investment in assets and managing financing costs. Those airlines are more dependent on business travel, which many analysts forecast might not fully recover from the pandemic until 2024if it ever recovers at all. Its current cash flow position is also strong, with cash flow from operating activities increased by 61 percent between the six months ended 31st March 2003 to six months ended 31 March 2004. But it was not the same as canceling its contract, and unsurprisingly, Haji-Ioannou was not satisfied. Objectives To assess the psychological distress, anxiety, depression, coping strategies, Finally the threats from the suppliers bargaining power, this is very strong in the airline industry for two reasons, one is highly skilled labour can command a very favourable terms and second is the price of oil. These risks may include: Shifts in consumer demand and preferences. Ryanair continues to lower costs, which enables it to persist lowering fares aggressively. This will provide an evaluation of the external business environment in which the company operates. Just two EasyJet aircraft were in the air, one en route from Londons Gatwick Airport to Lyon in France; another from Belfast to the English Channel island of Jersey. Over time, a brand may experience enough negative interactions that its reputation is placed into a vulnerable position. These large airline groups are so big and so important for so many economies that the national governments will do whatever they can to keep them alive, saysDirk-Maarten Molenaar, atravel and tourismindustry consultant at Boston Consulting Group. Previously it used telesales and now sales are through e-commerce web site. The sales process is efficient, as EasyJet sells directly to customers, instead of using external sales teams. But in the past, he says, most budget airlines have fallen down on execution, unable to make package holidays a profit-driver. Brand Awareness is another strength that is attributable to the company In November 1999, selected as a business super brand by the Super Brand Council, recognising EasyJet as an outstanding brand name. Webcomputing risks Let us look at five different types of risks and how they apply or vary by cloud deployment models. Capabilities to turn resources into advantages, Customers demand change to more flexible schedules, comfortable and relevantly cheap services, Extremely high competition for customers and resources. easyJet is delivering its strategy through four strategic priorities, which define the areas of focus to achieve their ambition. Strategies are largely determined by the extent to which they deliver best value to both customers in terms of being competitiveness in the marketplace (leading low cost airline) and also to provide value to shareholders. Normally there would have been close to 100. And while optimism about leisure travel in Europe is slowly rekindlingthis week, the U.K. announced a resumption of international travel to a limited number of destinationsEasyJet still faces plenty of potential turbulence, as the likelihood of a robust summer season recedes. Funding strategies developments is clearly important in that the nature of funding must be appropriate and compliments the low cost strategy of EasyJet, by ensuring that interest costs are low. Haji-Ioannou also alleged three large minority EasyJet shareholdersthe asset management companies Invesco, Phoenix Asset Management, and Ninety Onewere straw men, secretly controlled by Airbus, since all three companies manage some of the aerospace giants employee pension assets.But, in the end, Haji-Ioannous campaign failed to catch fire with other investors. These are flight simulators that recreate the exact cockpit of an Airbus A320 aircraft. EasyJet was able to operate at only 18% of its 2019 capacity. This enables easyJet to be efficient with network choices, with an emphasis on maximising returns. EasyJets competitive advantages via low prices are sustained in a number of ways. easyJet has refined its strategy to drive our purpose of making low-cost travel easy. )The crisis has also posed complications for the 54-year-old Lundgren that his competitors dont face, including some particularly unwelcome excess baggage in the form of Stelios Haji-Ioannou. Savings made from e-commerce is another source of value creation. S&P Index data is the property of Chicago Mercantile Exchange Inc. and its licensors. Healthcare workers were exposed to this highly infectious virus during the pandemic and suffered several social and psychological consequences, such as anxiety, psychological distress, and burnout. EasyJets decision to use its aircraft as collateral for loans it needed to get through the pandemic means that its cost base will be higher going forward, once debt service is included in the calculations, says Savanthi Syth, an airline analyst for brokerage Raymond James & Associates: Theyve traded liquidity for today in exchange for their aircraft ownership costs going up in the future.. A focus strategy can be implemented to resolve these issues as well. Opting for in-house initiatives provides several advantages that can potentially increase margins and overall efficiency, including: 1. Consumers are optimistic and the travel and tourism industry are now booming again. The carriers were expected to pare their loses to about$38 billionthis year, as vaccines are rolled out across the world. Introduction Company Background, Financial Performance and Key Services EasyJet is an airline company based in Britain The pandemic, of course, wiped out business and leisure travel alike. EasyJet cost efficiency is achieved in a variety of way as shown in the following diagram: The success of low-fare (cost) strategy is primarily dependent on the maintenance of a low cost base. easyJet will maintain its advantageous cost position through continued cost action. Implementing this strategy successfully depends on EasyJets ability to deliver enhanced benefits to customers over its competitors together with low prices. The concept of the value chain is particularly useful in understanding an organisations strategic capability since its concentrates on value activities and the linkages between activities rather ran just resources. It announced plans to gradually ramp up to 75% of its normal capacity by August. Enabling risk management through a We mentioned the seven most common risk events above, but other project risks could include contractor failure, unexpected life events, data transfer issues, shifting priorities, legal risk, market risk, and project deferral. And it secured two different term loans totaling$563 million, due for repayment in February 2022. And they are relentlessly focused on keeping per-seat costs down. Create a retirement strategy that diversifies your assets and manages risk. The airline founders misgivings had only mounted after the aircraft maker agreed in January 2020 to deferred prosecution agreements with the U.S., France, and the U.K. and to pay billions of dollars in fines stemming from charges that it had for years routinely bribed airline executives to secure contracts.When the pandemic struck, the aggrieved founder saw an opportunity to force EasyJet to abandon the deal. He offered a $7 million reward to any whistleblower who could provide him useful information leading to the cancellation of the Airbus contract. TECHNICAL Changes in retailing methods as such ticket sales via the Internet is now a common place in air travel, passengers receive an email containing their travel details and booking reference when they book online. Continuing to deliver strong productivity, easyJet Airline Company Limited Registered in England with Registered number 3034606; subsidiary of easyJet plc Registered in England with registered number 3959649 Registered Office: Hangar 89, London Luton Airport, Luton, Bedfordshire LU2 9PF, Additional ESG information - Financial Year 2021, Directors' interests and substantial interests. Product Development. Diversification. Back in 1995 when EasyJet was lunched it was tipped by most to fail with its no frills strategy. Also, only one type of aircraft is used, in order to minimise maintenance costs. The world economy is however, now on the up post September 11th. Most of Europe was in the yellow category, requiring 10 days of self-isolation when coming back, and with the U.K. government still advising against leisure travel. This will identify its strength, weaknesses, opportunities and threats. Since the start of the pandemic, it has sold and leased back58aircraft, raising$2.1 billion. The U.K. is doing well: It had approved two vaccinesone from Pfizer and one from AstraZenecain December and a third, from Moderna, in early January; by mid-May it had given 68% of the adult population at least one shot. major banks and insurance companies relocation call centres in Asia. This results in high levels of asset utilisation and reduced unit costs. EasyJet also have a reputation for paying low wages in line with its low cost strategy. SOCIAL changes in consumer taste and lifestyle represent both opportunities and threats for the industry. And Lundgren, who took overin late 2017, had big plans to build on that differentiation with potentially lucrative new ventures, including vacation packages, more benefits for business, and a new loyalty program. In terms of support activities, EasyJet takes advantage of technological developments in order to reduce costs. The minute consumers start to make a choice based on this, and I think they will, an emphasis on sustainability will pay off, says BCG consultant Molenaar, and EasyJet has been out front in preparing for this.. Improving CSAT across the whole customer journey. EasyJet may be especially good at outbound logistics lined to its marketing and sales operations and supported by its technology development. Strategic risk management is the process of identifying, quantifying, and mitigating any risk that affects or is inherent in a companys business strategy, strategic objectives, and strategy execution. Since March 2020,European governmentshave provided more than$32.2 billion in bailouts to the airline industry,through a mix of grants, loans, and debt-for-equity deals, according to a report from HSBC. Finally, in February 2021, the company took advantage of a sudden uptick in investor confidence on the news that vaccinations in the U.K. might allow international travel to return by late summer. It takes up to last extend in the time. Founded in 1995, low-cost carrier EasyJet established itself among the largest airline based in the United Kingdom by passenger numbers. EasyJet had a long-term contract with the aerospace giant that would require it to take delivery of more than 100 new planes, including at least 55 by 2024. (Lundgren declined to comment for this article.). Today, a year after Easy Jets announcement, those perils still hang over the airline. 8. So the strategy has been very successful for EasyJet and appears to have been the correct strategic decision. EasyJets powerless plight is typical of the entire industrys. After overcoming the many hurdles of producing a model with a viable context and associated risk factors, often the user of the innovation is neglected. Firstly, threats in terms of new & existing competition. For an independent carrier like EasyJet, finding money was more complicated, especially since the U.K. government initially balked at providing the airline industry with a custom bailout package. Thats the day the U.K. government first advised Britons abroad to return home as soon as possible in advance of impending travel restrictions because of the growing coronavirus pandemic. easyJet continues to optimise its network to ensure capacity is deployed in the markets where the strongest demand and returns are seen. In March 2020, he wrote to EasyJets chairman, John Barton, and demanded the company terminate the contract, citingforce majeure. Not that he was going away. Although mostly private now, many of these airlines were once state owned, and some still have not insignificant government stakeholdings. EasyJets no frills strategy does not only mean a cut in Cabin crew and denial of food, but also allows for a faster pre-flight preparation, thereby reducing the time grounded as well maintaining fare. Ive always said the four core markets are where we want to put our focus on U.K., Germany, France and Italy, he told the World Travel Market conference in 2018, shortly after the Air Berlin deal concluded. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! Lundgrencomplainsthat the British governments travel rules remain too onerous. Out on the tarmac, a short distance from the simulators, almost a dozen real EasyJet A320s sit idle. To understand EasyJets prospects, its important to understand its strategic positioning. )Compared to some of its low-cost rivals, EasyJet also owned more of its planes outright. But what are the internal weaknesses suffered by EasyJet? Another benefit of Internet technology is lower transaction costs at multiple levels in value chain activities. Lundgren had been an industry leader in trying to position EasyJet for this new world. The EasyJet brand is established in the European market, but brand awareness is required outside the continent. WebWhere risks produce outcomes that adversely affect EasyJet, it is crucial that these risks are either eliminated (if possible) or minimised. It renegotiated contracts with ground handling firms at several airports helping to lower costs. Looking for a flexible role? Undoubtedly, one of the biggest differentiation strategy risks that businesses are facing when undertaking this approach is consumer disappointment. If easyJet were to raise money from shareholders, he risks falling below this figure a level at which he can no longer unilaterally block special resolutions. WebIts evident that EasyJet takes few risks and applies firm business principles while carefully exploring the market. A lack of real-time reporting makes it easy to miss the signs of an approaching catastrophe. Value chain analysis can provide important insights into what management need to focus on strategically. Background Coronavirus disease-19 emerged in December 2019. They fly into second- and even third-tier airports, where they control a dominant share of the gates and can drive tough bargains on any airport fees and charges for ground crews and baggage handlers. Easyjet are situated extremely in strategic option 1 ( low monetary value, depression added value ) The eight nucleus strategic options are: 1. 3. Strategic risk is a category of risk; alongside operational, financial, regulatory and other business risks, it forms part of the umbrella of risks your organization faces. Therefore, it is vital for EasyJet to have a thorough comprehension of their costs and cost drivers. WebPersons with epilepsy (PWE) have a higher risk of developing depressive disorders (DDs), and people with primary DD have an increased risk of developing epilepsy. Therefore, capability is strongly related to the way that resources are used and controlled. With the modern aircraft fleet that it possesses, the fuel cost and aircraft maintenance cost is also reduced. Overview and forecasts on trending topics, Industry and market insights and forecasts, Key figures and rankings about companies and products, Consumer and brand insights and preferences in various industries, Detailed information about political and social topics, All key figures about countries and regions, Market forecast and expert KPIs for 600+ segments in 150+ countries, Insights on consumer attitudes and behavior worldwide, Business information on 60m+ public and private companies, Detailed information for 35,000+ online stores and marketplaces. With Ryanair maintaining high margins despite reducing yields through strict cost management. Overall the analysis will highlight the inherent threats and weaknesses suffered throughout the industry, and also the importance of innovation to maintain low cost advantage, alliances and size to success. WebSome compliance risks are specific to an industry or organizationfor example, worker safety regulations for manufacturers or rules governing the behavior of sales representatives in the pharmaceutical industry. Background Coronavirus disease-19 emerged in December 2019. (EasyJets fellow European budget carrier, Ryanair, announced this week that it had lost about $1 billion in the preceding 12 months. If you need assistance with writing your essay, our professional essay writing service is here to help! And, finally threats of any takeover bids from national airlines. The company carries out Marketing and sales will involve making customers aware of EasyJets services are price information and also selling. Now, at the cusp of a summer season that normally would be the source of the majority of EasyJets profits, the airline and its CEO face what could be a make-or-break season. Legal and regulatory change. The business has also enjoyed an increase turnover and trading profits resulting in continuous substantial growth in underlying profitability over the last 7 years (see table 1). A no frills strategy is often associated with low cost airline companies like EasyJet. In April 2020, EasyJet announced that it had reached an agreement with Airbus to defer delivery of 24 of the aircraft, meaning it would take on no new aircraft in 2021. Pandemics, lockdowns, trade disputes, financial crises and more can depress travel demand and threaten the bottom lines of industry players. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. EasyJet has cost advantages through company specific capabilities, which drive down costs throughout the value chain. Table 1 shows that EasyJets sales has increase year on year since 1998, with profit and gross margins also experiencing a positive trends. Those planes are Airbuss most fuel-efficient models, offering operational savings for EasyJet in the long run. The value chain analysis will show the total value added by the airline industry and EasyJet. Organizations continue to develop new applications in or migrate existing applications to cloud-based services. EasyJet also operates a flat management structure, which may lack a formal discipline that is needed as the organisation grows. The company has also grown in terms of its acquisitions of GO and also increase in purchases of its own aircrafts. Like all airlines, it instituted new procedures: increased cleaning, mandatory masks for passengers and crew, and no meal service. These moves enabled EasyJet to reduce its operating costs, excluding fuel, by about 31% in the year through Sept. 30, 2020. Technological Factors. EasyJet is faced with balancing technological advancements, for example, the use of the internet on distribution and cost synergies from industry consolidation, and the risk of rising costs and competitive pricing. Failure to acquire adequate funding for your business can damage the chances of your business succeeding. The price of EasyJets tickets various as a function of the number of seats remaining, the time until the flight, and historical trends. EasyJet is known for its low-cost competitive pricing. This will show how its critically important for EasyJet that strategic alliance, size and technological innovation have on its profitability. The same figure for Ryanair was 2.25 pennies, while it was about 5 for British Airways and 5.37 for Air France and KLM. Industry are now booming again EasyJet, it is crucial that these risks are eliminated... Its technology development centres in Asia are flight simulators that recreate the exact of. 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