Business Development and Innovation Report: Virgin Australia Analysis

This report provides an in-depth analysis of innovation and business development strategies employed by Virgin Australia, the second-largest airline in Australia. It examines their use of the "Innovative Value Chain," sustainable approaches, and stakeholder strategies. The report highlights key innovations such as the "Boeing 777" aircraft and vision-impaired user interfaces. Furthermore, the report proposes a novel service: replacing airplane windows with interactive screens for enhanced passenger experience, reduced aircraft weight, and cost savings. It discusses the integration of this technology, user involvement, prototyping, and cross-functional management considerations. The report also touches on the financial and technical aspects of implementing this innovation, including integration costs, testing, and the potential for reverse innovation. The aim is to provide a holistic view of how Virgin Australia can leverage innovation for continued growth and competitive advantage.

Running head: INNOVATION AND BUSINESS DEVELOPMENT
Innovation and Business Development
Name of the Student:
Name of the University:
Author’s Note:

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Executive Summary
The report will discuss about the concept of innovation and the way it is being used in the
various organisation. The report will particularly focus on the company of Virgin Australia. It
will first introduce the organisation and three HOT topics of innovation which the
organisation is using. Furthermore, the report will propose a new innovative service which
the organisation can take the help of. The various aspects of the service like design, its
integration, user involvement and others will also be discussed.

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Table of Contents
Introduction................................................................................................................................3
Virgin Australia..........................................................................................................................3
Three HOT topics.......................................................................................................................4
Innovative service......................................................................................................................5
Innovation service and the organisation.....................................................................................6
“Discussion about the innovation”.............................................................................................6
User involvement.......................................................................................................................7
Integration..................................................................................................................................8
Prototyping and testing capabilities...........................................................................................9
“Cross functional management”................................................................................................9
Future innovations......................................................................................................................9
Conclusion................................................................................................................................10
References................................................................................................................................11

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Introduction
The “process of globalization and the recent changes in the fields of innovations as
well as the technological advancements has drastically changed the way the different business
organisations and the companies transact their business in the recent times” (Cheng, Yang &
Sheu, 2014). Thus, it is generally seen that the organisations of the present business world
take the help of various kinds of “innovations and technology” to further enhance the process
of their business (Ngo & O'cass, 2013). The use of innovation for the process of business not
only allows the organisations to effectively manage their organisation but also to provide
quality services to the end users of the services or products offered by them. Therefore, it
would be apt to say that the organisations of the present times are using the concept of
innovation and creativity “to bring about the overall growth as well as the development of
their business organisation” (Holm, Günzel & Ulhøi, 2013). The report will discuss about the
concept of innovation and the way it is being used by the organisation “Virgin Australia” for
the process of their business. The report will propose also propose the idea for an innovative
product or service which the organisation can utilize to further enhance the prospects of its
business in Australia.
Virgin Australia
Founded by Brett Godfrey and Richard Branson in 2000 “Virgin Australia” is the 2nd
largest airlines organisation of the country of Australia (Virgin Australia, 2018). The
organisation, initially called by the name of “Blue Virgin” is currently based in the city of
Brisbane and offers 52 destinations to the people of Australia (Virgin Australia, 2018). The
organisation provides the largest number of fleets to the customers of Australia, that is, 101.
The organisation under analysis here also called by the name of “New World Carrier” is
famous for the use of strategies of “cost leadership and product differentiation” (Virgin

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Australia, 2018). However, many scholars are of the opinion that the use of innovation as
well as creativity and also the effective leadership provided by Godfrey and Branson has
significantly enhanced the prospects of the organisation and has enabled it “to become the 2nd
largest airlines organisation of the nation of Australia” (Virgin Australia, 2018).
Three HOT topics
The organisation “Virgin Australia” is one of the global leaders in the use of
innovation as well as technology for the process of their business operations (Gundry, Ofstein
& Kickul, 2014). Many scholars are of the opinion that the use of innovation and creativity
has significantly improved the prospects of the organisation in the recent times (Gundry,
Ofstein & Kickul, 2014). The organisation takes the help of the strategy of “Innovative
Value Chain” for the process of their business (Wei et al., 2014). Through the help of this
particular method the organisation not only creates as well as identifies the creative ideas but
also transforms them as per the requirements of their business (Wei et al., 2014). The opinion
of the CEO of the organisation about the concept of innovation is significant to note in this
particular context when he says that “innovation for Virgin is a change for the better - with a
focus on consumers” (Virgin Australia, 2018). Some of the most innovative ideas used by the
organisation are the “Boeing 777aircraft which is also called by the name of “The Business”
which provides state of the art facilities to the travelers who travel in them, the use of “vision
impaired user interface for in-flight entertainment”, use of the concept of “Innovation
Competition” which was propounded by Branson himself and others (Virgin Australia,
2018). Many scholars are of the opinion that the use of these innovations has considered
improved the prospects of the organisation in the recent times (Wei et al., 2014). In addition
to these, the organisation also takes the help of the strategies of sustainable approach as well
as the stakeholders approach. The sustainable approach enables the organisation to gain

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competitive advantage over their competitors in an ethical manner whereas the strategy of
stakeholders approach enables the organisation to maximize or prioritize the interests of the
stakeholders. The organisation takes the help of these two strategies not only to enhance the
profit gained by them but also to make an ethical use of the innovations developed by them
which is likely to provide various benefits to the customers.
Innovative service
The concept of innovative is one of the prerequisites of the airlines industry and the
various organisations related to this particular industry constantly needs to upgrade
themselves in terms of innovations and creativity to provide effective services to the
customers (Griffin et al., 2013). One of the major problems with the majority of the
organisations face is the problem of the enormous weight of the airplanes. The organisation
“Centre for Process Innovation” which is based in the nation of the United Kingdom has
come up with an innovative idea to solve this particular problem faced by the airlines
industry (Visnjic, Wiengarten & Neely, 2016). The organisation came up with the unique
idea to replace the windows of the airplanes with screens which will not only act as windows
but also as touch screen sensors which can be utilized for entertainment needs and also for
safety and other regulations (Visnjic, Wiengarten & Neely, 2016). The organisation has
further come up with the idea to replace the majority of the metal used for the structuring of
the airplanes with these see-through glasses. Many scholars are of the opinion that this
particular idea is to drastically modify the way the airlines are operating in the present times
not only in terms of the manufacture of the airplanes but also in terms of the customer
experience (Ritala, Hurmelinna-Laukkanen & Nätti, 2012). This particular innovation is in
synchronization with mission of the organisation to use innovative ideas for the process of
their business and also to provide the best quality services to the customers.

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Innovation service and the organisation
The organisation can utilize this particular innovation not only for the purpose of the
designing of its airplanes but also for enhancing the experience of the customers who take the
help of the services provided by them (Bourreau, Gensollen & Moreau, 2012). The major
airlines organisations of the world end up spending a considerable amount of capital on the
manufacture of the aircrafts and a considerable amount of that capital is being spent on the
metal which is being used to prepare the body of the aircraft. Therefore, if the organisation
utilizes this particular facility then it is likely to considerably reduce the cost of manufacture
of the aircrafts. Furthermore, the use of this innovation will be in synchronization with the
mission of the organisation. The organisation is currently exploring various kinds of
technologies to come up with new ideas therefore it is likely that this particular innovation
will be easily streamlined into the organisation (Bourreau, Gensollen & Moreau, 2012).
“Discussion about the innovation”
The passengers who take the help of the services provided by the airlines industry
generally get bored during the flight. Therefore, this particular technology is likely to give
them something new to entertain themselves. The people can enjoy the view outside or they
can even use the glasses as screens for the purpose of watching movies and others or the
screen cam also be used as reading screen (Amit & Zott, 2012). The customers can also read
about the safety regulations and other important regulations about the aircraft over these
screens. The below given figure provides an image of the proposed airplanes designed using
this technology-

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Figure: An image of the proposed aircrafts
Source: (Created by the Author)
The main design which will be used for the aircraft is given below-
Figure 2: Design of the aircraft
Source: (Created by the Author)
User involvement
One of the major focuses of this particular innovation will be to entertain the
customers during the passage of the flight in the most effective and to provide entertainment
to them (Amit & Zott, 2012). It is with this particular objective that the glasses will be see-

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through ones and can be used as screens as well the purpose of entertainment. Therefore, it
will be apt to say that the primary focus of this particular innovation will be to engage or
involve the customers in the most effective manner. The involvement of the customers is very
important as it is likely to enhance the satisfaction level of the customers which in turn will
help the organisation to earn the loyalty of the customers.
Integration
The organisation needs to take the help of the concept of the “Innovative Value
Chain” for the process of integration of this innovative idea within the framework of their
organisation. The innovative idea has already been generated and identified as an essential
one of the organisation to gain competitive advantage over its rivals (Boons & Lüdeke-
Freund, 2013). Therefore, the organisation needs to diffuse this particular innovation through
the various hierarchical orders of the organisation. The integration of this particular
innovation within the framework of this organisation is not only to require the approval of the
higher authorities of the organisation but is also likely to require a considerable amount of
expenses (Boons & Lüdeke-Freund, 2013). The integration of this particular technology is
also likely to require a considerable amount of technical expertise on the part of the
organisation for the successful incorporation of this particular technology within the
framework of the organisation. The integration is likely to cost the organisation a very
significant amount of capital and would be close to one billion including the charges of the
technicians and others. The integration apart from the engineers and other technicians is
going to require a significant number of manual laborers who would help in the process of the
installation of the glasses on the body parts of the plane. This particular process as well as the
various testing processes which would follow immediately after is going to require a time
period of at least one and a half years to two years.

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Prototyping and testing capabilities
The organisation before the full-fledged use of this particular innovation for all the
101 fleet which belongs to it needs to prototype the model in a mini scale (Schaltegger,
Lüdeke-Freund & Hansen, 2012). This will require the organisation to create a demo version
of a fleet with this particular innovation and test it on a repeated basis to check its success.
The organisation will also operate it for commercial purposes on a small scale and if it has
proved its success in this particular period of time then only the innovation will be used on a
large scale. The organisation can also follow the process of reverse innovation for the process
of testing the sustainability of this particular innovation.
“Cross functional management”
The organisation “Virgin Australia” takes the help of the concept of “Cross functional
management” for the purpose of redesigning of their business model not “only for the
purpose of gaining competitive advantage over their rivals operational in the same field of
business but also for providing better quality services to the customers from the different
parts of the world” (Schneider & Spieth, 2013). Therefore, it would be apt to say that this
particular innovation will act as a significant boon to the organisation for the process of
“Cross functional management”. The organisation taking the help of this particular
innovation can gain a significant amount of competitive advantage over their rivals.
Future innovations
The world of technology is a constantly changing one and it is seen that almost every
year new significant innovations emerge. Therefore, it is likely that the future developments
in the field of innovation are likely to wield a significant influence on this particular
innovation. For example, experts are trying to find ways by means of which the major body
portion of the airplane would be made of the glass and not just the windows and the top

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portions. This particular development once again would have a significant impact as it would
not only reduce the weight of the aircraft which would enable to fly in a much better but at
the same time reduce the cost of the manufacture of the plane in a significant manner. this
particular innovation will have a significant impact on the passengers as well.
Conclusion
The concept of innovation is being increasingly used by the various organisations of
the world for delivering better quality services to the customers. The use of innovation as
well as creativity at the same time helps the organisations to gain a competitive advantage
over their business rivals. Therefore, the primary focus of the organisations of the
contemporary business world should be on the use of the concepts of innovation and
creativity for the process of their business.

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References
Amit, R., & Zott, C. (2012). Creating value through business model innovation. MIT Sloan
Management Review, 53(3), 41.
Boons, F., & Lüdeke-Freund, F. (2013). Business models for sustainable innovation: state-of-
the-art and steps towards a research agenda. Journal of Cleaner Production, 45, 9-19.
Bourreau, M., Gensollen, M., & Moreau, F. (2012). The impact of a radical innovation on
business models: Incremental adjustments or big bang?. Industry and
Innovation, 19(5), 415-435.
Cheng, C. C., Yang, C. L., & Sheu, C. (2014). The link between eco-innovation and business
performance: a Taiwanese industry context. Journal of Cleaner Production, 64, 81-
90.
Great Value Fares on Flights From Australia | Virgin Australia. (2018). Retrieved from
https://flights.virginaustralia.com/en-au/
Griffin, A., Josephson, B. W., Lilien, G., Wiersema, F., Bayus, B., Chandy, R., ... & Oliva, R.
(2013). Marketing’s roles in innovation in business-to-business firms: Status, issues,
and research agenda. Marketing Letters, 24(4), 323-337.
Gundry, L. K., Ofstein, L. F., & Kickul, J. R. (2014). Seeing around corners: How creativity
skills in entrepreneurship education influence innovation in business. The
International Journal of Management Education, 12(3), 529-538.
Holm, A. B., Günzel, F., & Ulhøi, J. P. (2013). Openness in innovation and business models:
lessons from the newspaper industry. International Journal of Technology
Management, 61(3/4), 324-348.