Business Environment, Providing of No-Frills Air Travel Services to Passengers - Assignment Example

Task The researcher has chosen Proctor & Gamble (USA based) as a multinational FMCG company and Ryanair as a UK based low cost carrier that provideno-frills air travel services to passengers. Indeed, the mission of P&G is to provide top quality branded products and services and value that improve the lives of present and future customers worldwide. In return, customers reward P&G with sales, profits and value creation, thereby supporting employees, shareholders and the local communities of P&G to flourish. The company focuses heavily on value-addition, leadership, integrity and trust (of employees) as well as is quite passionate about accomplishing its goals and targets. For instance, the above mentioned values of P&G has resulted in creation of top quality workforce that feels pride in working for this multinational corporation. In addition, the company has strong loyal customer base that endorses novel ideas and products through acquisitions and purchases. The main objective of P&G is to target lower-middle, middle-middle and elite customers and enhance its market share through constant focus on innovation, differentiation and branding so that it could become largest FMCG Corporation worldwide (Internet: Pg.com). Ryanair is a UK based air travel services provider with a mission to provide no-frills low cost travel services to customers from middle – middle and lower - middle social classes who have inclination to save maximum amount of their hard-earn money. Ryanair, although, does not offer any top quality facilities to passengers, yet it has been famous and enjoys largest customer passenger base because of lowest fares compared to all other UK airlines. The core values of Ryanair are cost leadership and employee satisfaction, which gives this carrier an edge over rivals. The main objectives are to maintain cost-efficiency and no-frills services quality in extremely challenging business environment (Internet: Ryanair.com). The major difference between mission statements of both organisations is that P&G is more focused towards value-addition and offering branded production at higher prices (no compromises over product quality) whereas Ryanair is strictly concerned with cost-efficiency even through taking back some facilities from passengers. Stakeholders of both organisations are their employees, customers, shareholders, business partners, suppliers and government authorities. The stakeholders of P&G have achieved their objectives by becoming associated with a top quality brand offering corporation, which highly values inputs of all associated personnel for well-being and growth. The partners, employees and customers are penchant to continue their relationships with P&G in the long run. The stakeholders of Ryanair have accomplished their objectives by investing and acquiring ownerships in a profitable firm that maximises their wealth through generation of profits and disbursements in the form of dividends. The responsibilities of both organisations include production and sales of want-satisfying goods and services through use of socially responsible procedures, employee safety, legal compliance, payment of taxes, maximisation of shareholders’ wealth, accountability to stakeholders and environmental protection. P&G has designed an in-depth code of conduct and constitution to ensure they fulfill aforementioned responsibilities. For instance, P&G has also developed 5-year and 10-year plans for reduction of carbon emissions to ensure greater environmental protection (P&G Report, 2010). Ryanair has strict internal regulations and committees that opt to monitor all business operations, thereby attempting compliance with legal and environmental laws followed by organisational policies (Ryanair Report, 2010). Task 2 As far utilisation of resources is concerned, it is worthwhile to mention that P&G focuses heavily on workers’ individual performance and productivity. Also, the corporation inducts latest machinery / equipment so that it could automate business process and maximise productivity through efficient resource use. Ryanair, in contrast, is more focused toward cost leadership; therefore, it has cut down all unnecessary expenditures and extra personnel so that it could reduce costs and maximise internal efficiency. For instance, the company uses an online order tracking system so that it would not require extra staff for offices, ticket issuance, checking, monitoring and approvals. P&G has taken various educational and healthcare (Commander Safeguard campaigns) initiatives as part of its Corporate Social Responsibility (CSR) programme. The company also provides donations to ensure greater corporate philanthropy. Ryanair also gives donations and charities to local communities as well as support NGOs and welfare organisations financially but it does not have any official CSR programme. The demand of P&G’s products, with relatively high price elasticity (beauty, some food items and others etc.) is directly affected because consumers reduce their spending and consumption when inflation and unemployment increases. However, the demand of price inelastic products (such as soaps, healthcare and skincare) does not reduce considerably because they enjoy the status of necessities. Ryanair is also impacted due to changes in macroeconomic indicators because highly elastic travel demand for normal passengers reduces, whereas the demand from businessmen has some adverse impact. Similarly, high oil prices result in higher costs of doing business as well as increase inflation, thereby having double impact on Ryanair. Both corporations are profit-maximising entities that have been operational in oligopolistic FMCG and travel industries respectively, where unlimited buyers tend to purchase goods and services from limited suppliers. P&G has constantly expanded its presence in global markets through innovation, differentiation and branding even though it does not offer cheap products in the marketplace. Today, its products are heavily consumed in targeted households, which is the evidence of top performance. In other words, P&G has reduced its dependence on its traditional US market and has benefited from global economic integration. Similar is the case of Ryanair that has added new destinations and routes so that it could offer travel services to passengers worldwide. Indeed, environmental laws and employee safety regulations have affected UK organisations the most because they now have to spend greater sums to mitigate the issue of global warming. Next, affirmative action laws also impacts adversely because many deserving native candidates do not find jobs due to job system for candidates from protected groups. The real threat to both organisations is surging inflation that will affect demand of products / services and competitiveness in external business environment (P&G Report, 2010) and (Ryanair Report, 2010). References P&G Report (2010). Annual Financial Report 2009 – 2010. Procter and Gamble Available at www.pg.com Ryanair Report (2010). Annual Financial Report 2010. Ryanair Available at http://www.ryanair.com/en/investor/download/2010 www.ryanair.com www.pg.com Read More