External Environment of Virgin Airlines Report 2022

RUNNING HEAD: STRATEGIC MANAGEMENT
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Strategic Management
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Strategic Management
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Executive Summary
This report consist of analysis of external environment of Virgin airlines as this help in
strategic planning and to take strategic decision for survival of organizations in this competitive
environment. External environment includes analysis of micro and macro environment or
external factors that affect the performance or operation of an organization are analyzed in
external environment analysis. In below sections, external environment analysis is done by using
strategic tools such as PESTEL analysis, Porter five forces and SWOT analysis. All these
analysis is done on the basis of case study given on Virgin Group. Virgin group is well known
brand that is operated by Richard Branson, he is an innovator and entrepreneur who takes risk
and started various startups. Furthermore, after analysis some recommendations are given with a
brief on future of Virgin airlines followed by conclusion.

Strategic Management
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Table of Contents
1. Introduction..................................................................................................................................3
2. External Environment Analysis Virgin Airlines..........................................................................4
2.1 PESTEL Framework Macro environment European industry or UK....................................4
2.2 Porter five forces micro environment....................................................................................7
2.3 SWOT and TOWS Analysis..................................................................................................8
3. Future scenario and Recommendations.....................................................................................10
4. Conclusion.................................................................................................................................11
5. References..................................................................................................................................12

Strategic Management
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1. Introduction
Virgin Airlines is a UK based company own by Richard Branson, and traded as Virgin
Atlantic. The company operated under Virgin Group, and in 2007 there were 217 companies
registered in Virgin group at Britain companies house. “The opacity of Virgin’s structure and
finances encouraged frequent speculation about the overall performance of the group. During the
late 1990s, there was consistent evidence that the group as a whole was not performing well. The
Economist observed that: Virgin Travel is the only one of Virgin’s businesses to make a large
profit that includes Virgin airlines and Virgin Holidays”. Virgin airlines operate in Africa, Asia,
the Middle East and North America by using mix fleets of Boeing and Airbus. Richard Branson
focused on an approach that a business can succeed in first 12 months or exit the market this
belief of Branson was implemented in every startup under Virgin Group. “In this era of
globalized business where, both large corporations and small firms strive fervently to survive in
business, through consolidations and other strategic transformations; it is amazing and indeed
mystical to see Virgin Group, wallowing the global business terrain like jack-of-all-trades”. In
2007, Virgin airlines faced stiff competition with British airways and ended up in changing its
strategies to survive in airline industry in UK. “Virgin Group as it is today, developing and
expanding new businesses with cash flows and capital value, appears to be their ultimate goal; as
opposed to consolidating the group's assets and income, with accounting profits” (Grant 2008).
This report consist of analysis of external environment of Virgin airlines as this help in
strategic planning and to take strategic decision for survival of organizations in this competitive
environment. External environment includes analysis of micro and macro environment or
external factors that affect the performance or operation of an organization are analyzed in
external environment analysis. In below sections, external environment analysis is done by using
strategic tools such as PESTEL analysis, Porter five forces and SWOT analysis. All these
analysis is done on the basis of case study given on Virgin Group. Furthermore, after analysis
some recommendations are given with a brief on future of Virgin airlines followed by
conclusion.