Analysis of the Virgin group
- What is the logic of the group?
- Are there synergies between areas of the Virgin Group?
- Does the Virgin Group improve the performance of its subsidiaries?If so, how?
- What are the main challenges that the Virgin Group faces and how can they be overcome?
- The brand
- The charismatic leader: Richard Branson
- The financial strategy
The Virgin Group is led by a charismatic leader, Richard Branson (RB), who is described as an "architect of the 20th century" in a campaign organized by Apple.
At the organizational level, RB promotes accountability and managerial decision-making autonomy for the entities. Each one operates independently of other's values; however RB is very present in them. This creates a strong corporate culture where employee support is sought through a policy of stock options, bonuses and profit sharing.
Thus, its leader only intervenes in major strategic decisions and the finalization of certain contracts. However, he is involved heavily in marketing and promotion, an area that he particularly loves.
The group finances itself mainly through acquisitions and disposals of businesses. RB prefers to sacrifice short-term profits and reinvest to focus on the long term expansion.
Even when R. B. resigned in 2003 he made the company go in for an IPO in 2004 IPO for the ?low cost' airline. Virgin Blue, with a 25% stake in Virgin Mobile to finance the group's expansion across the world, with new activities.
As mentioned earlier, the goal is to introduce Virgin's activities in which the company is devoid of any experience. The logic is to use an aggressive diversification strategy in the company's development.
The group enters a new competitive world, into new areas of activity that require the acquisition and integration of new skills.
The group is able, through Richard Branson's management style and vision to bring together the key success factors contributing to the colonization of a previously unexplored area of activity by its employees.
Tags: Virgin group, Richard Branson, analysis of Virgin group
[...] The synergy between the areas of the Virgin Group is therefore universal in its adaptability to potential latent demand, market worn by the reference offer. Transversal competencies are, of course, implemented to operate the developed image in various activities; the image that wins over customers and generates value in other areas. In this way, diversification intrigues prospective customers and investors. In short, Virgin adopts a conglomerate logic. It can be seen as a diversification in terms of all-out areas. The company prefers to expand its portfolio horizontally. [...]
[...] Indeed, the exploited resource and expertise developed by Virgin lies in its adaptability.The group is able, through its management style and vision, to bring together the key success factors contributing to the colonization of a previously unexplored area of activity by its employees. By empowering its managers, giving free rein to their initiative and enterprise, Richard Branson promotes the autonomy of its subsidiaries.The pattern of development of the group is to bring awareness of the Virgin brand and its financial partners in a constantly evolving market. [...]