A REPORT ON MICHAEL O’LEARY’S BUSINESS PHILOSOPHY & LEADERSHIP
The purpose of this report is to closely look at the business philosophy and various leadership aspects of Micahel O’Leary, who is the chief Executive Officer of the Ireland based budget airlines company, Ryanair. O’Leary’s management and leadership style will be acutely analyzed and his behavioral traits and characteristics will also be examined.
It is to be determined how among all the backlash and controversies O’Leary has managed to be one of the successful CEO’s in the world and take his company from being a small emerging airliner to one of the largest in the entire world.
Leadership is extremely important for the success of any sort of organization. However, it is especially true when it comes to commercial organizations. Business enterprises need acute, smart and precise decision making at every turn.
That is where the importance of business leaders lie. Besides. Leaders also help to cultivate a common culture and be the thread that holds the entire company together. Business leadership can be of varied kinds, however the goals of each leader are mostly the same- to boost their organization’s growth along with the growth of the involved individuals. The purpose of this assignment is to closely look at the leadership style and decisions of O’Leary.
Ryanair is an Irish airline company providing budget travel services to its customers. The CEO of the company is Michael O’Leary and he has taken great strides to ensure the success of his company.
He is well-known for further developing the low-cost model, which has helped his company to a great degree(ryanair.com, 2020). However, he is also quite controversial in the industry due to several instances of disputable comments and gestures.
Figure 1: Michael O’Leary
(Source: Alam et al. 2019)
Human behavior in organizations, also known as organizational behavior is basically the examination of how people behave in the context of the organization. Organizational and managerial processes are key in assessing the human behavior, which in turn is significant for various aspects in the activities of the company.
As per Mikkelsen et al. (2017),properly understanding and appreciating the behavior of the people involved in the organization can be useful for making sure that the business leader has a detailed information about various aspects. These include employee performance and motivation, organizational structure and also communication.
Michael O’Leary, as the CEO of Ryanair must put a lot of effort and focus on the aspect of human behavior in his company. There has been a number of issues in the company regarding dissatisfied employees. It will be instrumental for the CEO to address these issues and take steps to further avoid any sort of similar dilemma. He must also attempt to improve the interdepartmental communication in the organization.
Figure 2: Organizational behaviour
(Source: Western, 2019)
Organizations are structural systems which are meant to serve functions, as an overall entity and also the different structures of the organization. As per Kuvaas et al. (2017),organizational functions can also be referred to as the set of core processes which must be carried out properly to facilitate the running of the company.
Organizations generally have several structural functions which include the likes of front office functions, back office functions and business communications. There are also other functions such as the finance function, HR function, marketing and administrative function.
The primary functions of Michael O’Leary’s company Ryanair are the finance functions, business communication functions, administrative functions and marketing functions. Being the CEO of the company, O’Leary is responsible for overlooking all these functions to make sure that the company keeps functioning properly and efficiently. The entire organizational system can fail if even one of this functions stop operating properly as per the necessity.
Michael O’Leary has been quite unique when it comes to his approach towards running the overall business and attitude towards the industry. He is extremely outspoken and is often in the headline for several controversial reasons. However, he has also been instrumental to taking Ryanair to the successful position where it is now.
It is often claimed that O’Leary has reinvented a new category of aviation, which has been popularized by Ryanair. There is a category of people who do not want the best service available but the cheapest possible price they can get. O’Leary has helped his company to create a market out of this people and made the company one of the largest budget airlines in the country.
It has often been argued whether O’Leary is a leader or a manager. There is no doubt that he is extremely dedicated to his company and was instrumental in creating the business model which utilized the budget market sector and created his company’s approach around that.
His cost cutting strategies and charging low fares from the customers has not only helped the company but also the individuals involved. He has often been criticized for his rash behavior and rude attitude, however his extreme drive to perfect his work also makes him charismatic and inspire people to follow him.
Figure 3: Leadership styles
It is believed that beneath all the controversial rants, foul language and rude behavior O’Leary is a visionary, with his eyes constantly laid at the bottom line. He is a strong believer of the principle- “there is no bad publicity”. Hence, according to Christoffer (2019), he never backs off from speaking his mind in front of the world even when it is overly and excessively inappropriate.
Besides all the backlash and controversy, this characteristic has also made him quite charismatic for a large number of people who is inspired by him. His abrasive personality makes him stand somewhere in the middle of leadership and management.
He is neither in some ways and both in other ways. This distinctive blend of being a great manager and being a great leader has made him so successful. This brand of uniqueness along with the efficiency and efficacy of his work has made him a quite a significant personality in the industry.
Michael O’Leary’s unique and eccentric leadership style impacts all aspects of his company to a significant degree. It plays a particularly important role for maintaining the organizational culture in Ryanair and boosting employees’ morale and motivation.
Cost cutting, which is perhaps the basis of O’Leary’s CEO model, also applies to all aspect of the company’s business operations. It is a part of the organization’s culture and the employees are to incorporate this model during their services as well.
O’Leary makes sure that the expenses that may be generated from his employees are kept at a bare minimum. The employees receive the minimum amount of benefits for working in the company. However, as per Gagné (2018),the CEO has also taken steps to make sure that the company is not associated with the word ‘cheap’.
The employees, though not receiving many additional and attractive benefits are well-paid and cared for. O’Leary’s principle of creating value with the minimum has been extensively adopted as the company culture as well.
It may seem, being the eccentric and unpredictable person Michael O’Leary is, that the decisions taken by him are mostly instinctive and impulsive. However, that cannot be further from the truth.
O’Leary is well aware of his wants and needs and he constantly bases his decisions around that. Being an autocratic leader, as per Tasselli et al. (2018), O’Leary carefully assesses the situation to his best capability and then issues instructions to his employees which are expected to be followed without any question.
Contrary to popular belief, he pays more focus and significance to acute analysis and assessment rather than to emotional values and gut feelings, while making various business decisions. He also makes sure to receive feedback on the result of his decisions to learn from his prior experiences. This helps in avoiding the same decision related mistake twice.
Despite all the controversy that is related to the Michael O’Leary, it is also responsible for bringing several changes to Ryanair, the majority of which has proved to be positive changes. He has taken the company from having 5000 customers in the year 1986 to it being one of the largest and well-known airlines in entire Europe(Harrison, 2018).
O’Leary was the one who brought around, perhaps, the most important change for Ryanair in the history of the company, which would change its course forever. He adopted and further developed the low cost model and implemented it in his company. It gave Ryanair an identity as a budget airline who provides decent services at the lowest possible costs.
Staying true to his own personality, O’Leary also encouraged the company to take up a more aggressive advertising campaign, which despite the controversies, have managed to publicize the company well.
Michael O’Leary being such a unique and eccentric personality, it is needless to say people had trouble adopting his principles and the changes he brought to the company.
They were resistant to the changes, in fact, employees continue to resist his principles due to multiple reasons. O’Leary has always stood in the middle of leadership and management, as explained previously, and has practiced a form autocratic leadership.
Employees mostly do not prefer this sort of leadership and tend to reject it, at least initially, due to the lack of participation it demands on their part. Low amount of psychological satisfaction is another reason of rejecting O’Leary’s principles.
It can be concluded that Michael O’Leary is a CEO whose likes are not seen much in the business industry. He is extremely rash, aggressive, foul-mouthed and faces controversies on a regular basis. He has made a career out of the phrase ‘no publicity is bad publicity’. However, saying all his success is just the direct result of his publicity stunts would be grossly false.
It is important to remember that O’Leary has unmatched dedication to his job and an eye for detailed observation. These features along with his smart decision making capabilities have helped him to take his company to being one of the most successful airline in the world.
Alam, M. N., Alias, R. B., & Hassan, M. M. (2019). Impact of Social Compliance on Employee Motivation: An Empirical Study. Retrieved from: https://www.researchgate.net/profile/Mohammad_Alam112/publication/339295535_Impact_of_Social_Compliance_on_Employee_Motivation_An_Empirical_Study/links/5e48cdef458515072da0b618/Impact-of-Social-Compliance-on-Employee-Motivation-An-Empirical-Study.pdf
Christoffer, S. (2019). How leadership affects organisational performance during times of business transformation: the case of Ryanair’s CEO Michael O’Leary (Doctoral dissertation). Retrieved from: https://repositorio.ucp.pt/bitstream/10400.14/26873/1/Dissertation%20Sebastian%20Christoffer.pdf
Gagné, M. (2018). From strategy to action: transforming organizational goals into organizational behavior. International Journal of Management Reviews, 20, S83-S104. Retrieved from: https://selfdeterminationtheory.org/wp-content/uploads/2019/06/2018_Gagne_JOMR.pdf
Harrison, C. (2018). Leadership research and theory. In Leadership Theory and Research (pp. 15-32). Palgrave Macmillan, Cham.
Kuvaas, B., Buch, R., Weibel, A., Dysvik, A., &Nerstad, C. G. (2017). Do intrinsic and extrinsic motivation relate differently to employee outcomes?.Journal of Economic Psychology, 61, 244-258. Retrieved from: http://student.bms.lk/CBM/Slides/AS%20journal%20Articles/new/kuvaas2017.pdf
Mikkelsen, M. F., Jacobsen, C. B., & Andersen, L. B. (2017). Managing employee motivation: Exploring the connections between managers’ enforcement actions, employee perceptions, and employee intrinsic motivation. International Public Management Journal, 20(2), 183-205. Retrieved from: https://pure.vive.dk/ws/files/383034/10967494.2015.pdf
Smircich, L. (2017). Concepts of culture and organizational analysis. In The Anthropology of Organisations (pp. 255-274). Routledge. Retrieved from: http://www.academia.edu/download/35468707/Smircich1983.pdf
Tasselli, S., Kilduff, M., & Landis, B. (2018). Personality change: Implications for organizational behavior. Academy of Management Annals, 12(2), 467-493. Retrieved from: https://discovery.ucl.ac.uk/10042198/1/annals.2016.0008.full.pdf
Western, S. (2019). Leadership: A critical text. SAGE Publications Limited. Retrieved from: http://repository.tavistockandportman.ac.uk/72/1/Simon_WESTERN_CH_13_emergent_leadership_2008.pdf
ryanair.com, 2020, Ryanair, Available at: https://www.ryanair.com/gb/en/ / [Accessed on: 20th April, 2020]
Academic Research Writing Arm of Global Research Services.