Virgin Corporate Strategy Case Study

Topics: Virgin Group, Richard Branson, Brand Pages: 12 (4013 words) Published: October 21, 2008
This case study provides an opportunity to explore the person-organisation (fit with the culture of the organisation) interface (the place, situation, or way in which two things or people act together or affect each other or the point of connection between things). From a developmental point of view, it examines the making of an entrepreneur. The case also allows for an exploration of the vicissitudes (unexpected changes, especially in somebody's fortunes) of leadership. It looks at effective leadership in the context of a high performance organisation and, finally, incites discussion about planning for the future of an entrepreneurial organisation, in particular using a brand to enter new, unrelated markets. Leading by Design

Identifying and optimizing leadership capabilities
Issues: Transformational activities cannot occur without a dynamic and focused leadership. A number of distinct but complementary capabilities are needed to be an effective breakout leader. These are positive, negative, conceptual, creative and relational capabilities. It is rare that any one person possesses all five capabilities. What is important therefore is that a top leadership team successfully combines all five capabilities and deploys then in the formulation and implementation of strategy. In this way they can ensure that their companies rapidly and decisively breakout of their industry context to establish fast track business growth. The House that Branson Built: Virgin’s Entry into the New Millennium Briefly identify the key components of Virgin’s corporate strategy. What made Virgin so successful and a breakout company? How would you describe Branson’s leadership style and philosophy? Could Virgin have succeeded without Richard Branson’s unique entrepreneurial flare and leadership capabilities? ---------------------------------------------------

DP: Big companies like Kodak and Polaroid face very unique problems in that their entire business models (namely camera film) are withering away. Kodak's answer has been to enter the digital photography space under the Kodak name, but as you point-out in your book, they are late to the game and not a name people associate with great cameras (or digital photography or electronics), only great film. The suggestion you make in your book is that companies not use their established brand names to launch new brands or categories, but companies like Kodak have so much equity in their names. What is a company like Kodak to do when they have a name they have spend years and hundreds of millions of dollars to build, only to now have it's core association (film) relatively decimated and its new association (digital photography) not clicking with consumers? LR: I should point out that Kodak invented the digital camera. When you put an existing name on a new category of product, you are bound to wind up a loser. You need the courage to use a new name. Should Toyota have called its luxury car, the Toyota Supreme? I think not. Lexus is a much better name. Sony most profitable product is not called Sony, it’s called PlayStation. ****

DP: You say mega-brands, like Virgin, are rarely effective because they put every product line (i.e. Virgin Atlantic, Virgin Mobile, Virgin Mega, etc.) under the main brand name as opposed to a brand like Tide that is solely associate with laundry detergent. Virgin however, as a whole, has been effective (with some exceptions, of course) and I'm curious what it is about that company that makes it unique in that regard? That's not to say that Virgin's methods are advisable for the marketplace as a whole, but what can we learn from what Virgin has accomplished? LR: Very little. Just because Virgin is successful doesn’t necessarily mean that your company can be successful with a similar strategy. There are some fundamental reasons for Virgin’s success starting with Virgin Atlantic, an airline that enjoys monopoly status (along with British Airways) at Heathrow...
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