Risk Management within Ryanair

This report is to represent collected information about risk management process within Ryanair’s company. Risk is a part of every industry and good understanding about it is essential to create and maintain successful business. The twenty-first century has been through terrorism attacks and disease outbreaks.

‘Since the terrorist attacks of 11 September 2001in the United States, the term ‘risk management’ has become strongly associated with psychical safety and security of travellers […] While there are many types of risk to which the tourism industry must respond, the focus of the new millennium centres on the physical safety of customers and staff’ Taylor cited in Wilks and Page (2003:7).

Many of these accidents had not only local or regional, but global impact and prompted tourism crises at corporate, industry and destination level (Henderson, 2007:1) . This report will represent understanding of risk management area as well as give an insight into risk management process with the use of the secondary data.

Risk management is increasingly recognised as being concerned with both negative and positive aspects of risk. Risk can be defined as the combination of the probability of an event and its consequences. In all types, there is the potential for the event and consequences that constitute opportunities for benefit or threats to success. (Risk Management Organisation, 2002)

Therefore this standard that risk management is recognised with both positive and negative aspects of risk, it considers risk from both perspectives. According to Saayman et al. (2009), in the safety field, it is generally recognised that consequences are only negative and the management of risk is focused on prevention and mitigation of harm. Risks in the tourism industry can be divided into paternal and external. Internal (domestic) risks include crime, transport risks at the destination. External (international) risks include terrorism, economical and political issues, natural disasters taking place outside the border of a destination but that impact upon travel to a destination.

As Cooper et al (2008:296) states, risk can occur in several ways and is common in every industry. There is always risk associated to travel, they can be mitigate by choosing destination with lower risk perception, however it is rather rare that perception of risk is equal to risk itself. The way that media report any accidents or terror incidents influence the perception of risk and at the same time influence economy of the destination of incident.

Other than risk management there are disaster and crisis which should be identified in order to avoid misunderstanding between those three different areas. Anticipatory crisis management plays a particular role anywhere where competitive advantage is easily open to attack or can be destroyed by negative events. This applies in general for tourism, which like no other industry works with values and making dreams come true. Tourism is a phenomena of the modern era and describes everything in general that is associated with travelling. According to Glaesser (2006:15), tourism should be understood as ‘the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business or other purposes’.

When it comes to disasters, it is ‘a serious disruption of the functioning of a community or a society involving widespread human, material, economic or environmental loses or impacts, which exceeds the ability of the affected community or society to cope using its own resources’ United Nations (2011). The immediate effects of disaster (e.g. earth quake, hurricane, etc.) could be destruction of tourist infrastructure and superstructure. Apart from the direct effect of the disaster on the destination, it is common that places where disaster took place suffer long-term damage if travel risk-perceptions are generated (Cooper et al, 2008:279).

Many different definitions can be found of Risk Management, but they all have the same meaning. It is the process whereby organisations methodically address the risks attaching to their business plans. Risk management is for any activity, long or short term. The benefits and opportunities should be viewed not just in the co text of the activity itself, but in relation to the other various stakeholders that can be affected/affective.