Identification and Analysis of the Key Stakeholders and Reputational Issues - Statistics Project Example

Corporate Reputation

Introduction

Organisations maintain corporate reputation as a mechanism of attracting new customers, investors, suppliers, and employees and this enables companies to gain competitive advantage over their business rivals (Lostakova & Stejskalova, 2014). Corporate reputation enhances the preference of a customer to do business with an organisation to an extent that the organisation is able to gain in terms of its worth in the financial market and the capability to charge a premium for services and products. Moreover, corporate reputation makes it possible for the aviation industry players such as airline operators to get the support of the stakeholders and as such, reduce the perceived risk by consumers when purchasing products and services (Dineen & Allen, 2016). Therefore, organisational reputation makes it possible for companies to attract top talent in the job market, which leads to better employee satisfaction and in turn enable profit-making organisations to increase their negotiating power in the channels of trade. Therefore, this paper seeks to provide a critical analysis on Ryanair and propose approaches that can enable the company to provide better customer services with an aim of building a better brand image that can promote it to gain positive publicity and a strong corporate reputation.

Identification and Analysis of the Key Stakeholders and Reputational Issues

Ryanair faces many reputational issues to an extent that customers have resorted to social media to complain about the quality of services offered by the company (Solomon, 2012). For instance, the Italian airline authorities fined Ryanair because the company was offering poor customer service and, this prompted authorities to act in the interest of the public. Moreover, the company’s reputation over the last three years remain poor while the company revenues are rising and this has led to many consumer global bodies to emblem Ryanair as one of the worst performing airlines in terms of customer service and brand image. Therefore, Ryanair attracts customers because of its low prices and as such, many travellers prefer to use the airline despite of its poor customer services (Ham, Woo Jun & Cho, 2012). For example, the company has a premium phone number, which means that customers enquiring through the company’s phone number must pay before accessing customer services.

MacIndoe and Barman (2012) define organisational stakeholders as the groups or people that depend on a particular organisation as a means of realising their goals and in turn, the subject organisation depends on them. The stakeholders of Ryanair include its employees, shareholders, services providers such as providers of air navigation service, trade unions, European Aviation Safety Agency, Airports Council International Europe, pressure groups, competitors, customers, and suppliers.

Improving The Company’s Long-Term Customer Service, Identity, Image, And Brand

Ryanair faces many reputational issues as pointed above and, therefore, there is need to develop a framework, which would ensure that Ryanair has a unique brand, image, and identity as a mechanism of promoting the competitive nature of the airline (Dineen & Allen, 2016). Ryanair has suffered many reputational drawbacks owing to the airline’s inability to provide services, which meet the expectations of the customers.

Long-term Customer Service

Ryanair airline can meet long-term customer services by training its crew and other personnel who engage with the customers on the ideals of upholding interpersonal interactions with the passengers. Therefore, Ryanair should adopt a communication strategy pegged on an integrated communication network, whereby the company would endeavour to pool public relation practitioners, advertising, marketing, and technology together (Cook, 2016). Moreover, Ryanair should consider consumer behaviours and strategic management approaches that are essential in creating a distinctive brand image for the organisation. Therefore, an integrated communication system is critical to enable Ryanair to interact with customers to position the airline as a number one brand in the aviation industry (Kleyn, Abratt, Chipp & Goldman, 2012; Zavyalova, Pfarrer, Reger & Hubbard, 2016).

Moreover, Ryanair can enhance long-term customer service by emphasising on clarity because Ryanair does not provide clear guidelines to passengers. For instant, the airline does not provide specific prices when customers begin to book for their flights to an extent that many customers are complain about Ryanair’s commitment to serve customers. Thus, the airline should be clear about the ticket prices at the onset of booking and provide transparent travel insurance. Further, it is essential for Ryanair to develop sound frameworks of monitoring the behaviour of the consumers and this is mainly because human beings are emotional beings, as this approach would enable the airline to prioritise the customer expectations (Aldaz, Alvarez & Calvo, 2015). With the increase of competition from companies such as EasyJet, Ryanair should adopt good customer relation policies as a mechanism of thwarting competition from other airlines and as such, create an exceptional brand image.

Identity, Image, and Brand

The biggest drawback for Ryanair is the provision of poor customer services and in this respect; the company can achieve success by using its services and products as a marketing strategy (Zhu & Chang, 2013). In other words, Ryanair can create a unique identity, image, and brand by endeavouring to not only lower the cost of flight tickets but also enhance customer experience by providing services that are attractive and more appealing. Ryanair can develop a novel brand image by undertaking rigorous advertisement in European countries by fronting the company as an airline of choice, which endeavours to provide best customer services to expand its market share in EU.

Transparency is one of the undertakings that can enable Ryanair to build a unique brand image through which customers can identify with the airline due to its organisational culture that is geared towards zero concealment of vital information such as flight prices, departures and delays. Therefore, Ryanair airline should draw from theories of identification and social identity on how most customers associate with a given organisational culture (Rokka, Karlsson & Tienari, 2014). Therefore, Ryanair can employ its unique organisational culture of low prices as a springboard of creating a distinct identity, image, and brand to turn around its dwindling sales and profits that increased consistently from 2010 to 2014 and plunged during the fiscal year 2015 as shown in the graph below.

Fiscal year is Apr - Mar

2015

2014

2013

2012

2011

2010

Ryanair Net Sales or Revenues

4.46B

6.75B

6.29B

6.05B

4.8B

4.22B

Cost Of Goods Sold (COGS)

2.13B

3.48B

3.15B

2.96B

2.27B

1.86B

Ryanair Gross Profit

2.32B

3.28B

3.15B

3.09B

2.53B

2.37B

Fig: Ryanair income statement

Gaining Positive Publicity

Bednar, Love and Kraatz (2015) define publicity as attention or notice given to an entity by the media. On the other hand, Dineen and Allen (2016) describe publicity as giving out information about a company, person, or product for the purposes of promotion or advertising. Ryanair can gain its positive publicity by undertaking intensive ad campaigns, whereby the company would aim to create a unique positive image with stakeholders such as customers and suppliers. In addition, Ryanair can boost publicity by taking marketing to the digital platforms such as newspapers, social media, and digital ads to an extent that the company would establish itself as a household name (Cook, 2016). Therefore, the application of the marketing campaign would make it possible for Ryanair to link online and offline components such as digital ads, paid search, and emailing registered Ryanair cardholders.

Ryanair carried about 101.4 million passenger for the year ended 2015, which represented a 17% increase from 2014 despite inconsistencies in number of passenger in different months as shown in fig. 4 below. This was attributed to expansion in its load factor that increased to 91%, lower fuel prices and most importantly “Always Getting Better” the company’s passenger experience programme that has enabled the company to gain positive publicity (The Irish Times, 2016).

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Source: The Irish Times (2016)

Conversely, Ryanair can purchase smart-target placements on rating websites, which would make it possible for customers to provide reviews on their services by leaving feedback and this can facilitate in boosting its publicity (Rahi, 2015). Moreover, modern-day world provides many digital platforms such as social media and since many people own smartphones, Ryanair can take its publicity to social media sites such as Twitter, Facebook, and Google+ among other sites. Thus, Ryanair can increase its customer experience by engaging in corporate communication with all stakeholders to recreate and turn round its brand image (Peloza, Ye & Montford, 2015; Smaiziene & Jucevicius, 2015). Ryanair can also realise positive publicity by identifying its target market and strive to create an identity this market by offering good customer care services. For instance, there is need for the airline to improve customer experience by making expectations of customers a priority, and this would encompass up surging of transparency through redesign of its customer services such as eliminating premium charges on customer care phone calls.

Press releases are the other tools that Ryanair can use to create and improve positive publicity. This entails profiling entire positive undertaking such as corporate social responsibility (CSR) activities that positively influence societies where the airline conducts its business (Skard & Thorbjørnsen, 2014). For instance, Ryanair can adopt powerful press releases when the company opens a new route, hires new employees, and when introducing new services or product lines. Sustenance of an organisational culture that is effective and efficient would make it possible for Ryanair to market itself as a cheaper or lower priced airline to enable it position itself as a brand of choice that caters for consumer needs in their minds (Homburg, Stierl & Bornemann, 2013). Therefore, external communication approaches would enhance ability of Ryanair to attract new consumers and retain its current market share in the airline industry.

Corporate Reputation for Ryanair Beyond 2016

Ryanair intends to turn around its corporate reputation beyond the current year (2016) through rigorous improvement of its customer services through the “Always Getting Better’ plans that it launched in 2014. This partly involves creation of an accessible online booking system that enables prospective passengers to book and pay online and reduction of passenger complaints through improved services as shown in fig. 5 below for March 2016 (Ryanair, 2016)..

Ryanair, for instance, beginning 2016 started registering increase in number of passenger with January recording 25% increase from 2015 (5.98 million in 2015-7.48 million 2016). This number consistently continues to rise as evidenced March 2016 numbers of passengers of 8.5 million compared to 6.6 million of 2015 (Fitzpatrick, 2016). This has been boosted by lower fares charged, stronger forward bookings and enhancement of “Always Getting Better” (AGB) initiative (Fitzpatrick, 2016).

Fig. 4 Source: The Irish Times (2016)

Fig. 5 Source: Ryanair (2016).

Moreover, Ryanair can realise a positive corporate reputation by curbing punitive charges such as those levied on customers when they forget their tickets and other essential documentation by maintaining its organisational culture of low prices as opposed to imposing undisclosed charges on customers. Moreover, the airline should relax its luggage rules and exercise due diligence when handling passengers’ baggage further in its ‘Always Getting Better’ phase there it intend to launch this year. Currently, Ryanair does not have well formulated structures of handling customer baggage and as such, it is important for the airline to provide enhanced services in handling of baggage in transit. This is because this has enabled the company to improve its reputation and has since been registering increasing passenger numbers and load factor as shown in fig. 6 below for April 2015 and 2016.

Source: Ryanair (2016).

Ryanair should launch a business mobile application and ensure that customers do not pay for it. Mobile apps enable companies to access wide markets because many people possess smartphone, which make it possible for the customers to access products and services provided by Ryanair (Peloza, Ye & Montford, 2015). Ryanair can achieve a long-term corporate reputation by changing the culture of the staff and this is manifested when the staff is impolite to the customers to an extent that the passengers feel like changing their preferred brand.

Therefore, Ryanair can change staff culture by undertaking rigorous training of crewmembers and base supervisors. Accordingly, the training of the employees in relation to expectations of the customers would enable Ryanair to build a good corporate image for a longer period (Ertug, Yogev, Lee & Hedström, 2016). Ryanair should develop new departments, which would ensure that the company institutes soundly formulated approaches that facilitate recruitment of the best talent in the job market since human resource is a critical factor that determines the success or failure of an organisation.

Conclusion and Recommendation

Enhancing long-term strategic corporate reputation management to manage perceived risks that can negatively impact on the performance of Ryanair. Strategic management of corporate reputation would enhance the performance of organisations, whereby companies would be able to attract potential stakeholders such as talented employees, investors, and suppliers. In light of this, it is recommended that organisations can realise long-term strategic corporate reputation management by carrying out processes that ensure customers get the value of their money and this would encompass total transparency on the costs of the services and products offered by the company. Corporate social responsibility is one of the approaches that enable organisations to maintain a long-term corporate reputation because the companies carrying out CSR activities intend to change the perception of the local communities to an extent that a company is likely to achieve profits (Hur, Kim & Woo, 2014). Moreover, many corporations can realise enhanced corporate reputation by building brand images by using services that corporations provide as marketing strategies since many prospective buyers would be willing to savour the customer experience advertised by the organisation.