Virgin Group: Competitive Strategy, Innovation, and Business Analysis

This case study delves into the competitive strategy and innovation practices of the Virgin Group, highlighting the importance of organizational structure and culture in its success. Key resources such as the Virgin brand and Richard Branson's leadership are examined, along with the group's capabilities in varied organizational management and customer service. The analysis identifies potential businesses for divestment, emphasizing the need to consider strategic attributes and industry attractiveness. Recommendations for changes in organizational structure and management systems are provided, focusing on protecting the Virgin trademark, addressing financial instability, and centralizing senior management. The study concludes by underscoring the significance of employee motivation, accountability, and freedom in driving the group's success, and it proposes a systematic approach to managing the Virgin Group's diverse portfolio.

Competitive Strategy & Innovation
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Introduction
 The success of the organization can be traced to the aspect of
organizational structure.
 The success of the organization can be traced to the aspect of
organizational culture.
 The capability of Virgin to operate effectively owes much to
the team’s organizational culture

Resources
 For probing the business strategy of the Virgin group,
it is necessary to ask about the resources.
 The resources should be similar for the different
companies of Virgin group.
 The two key resources are the brand ‘Virgin’ and
Richard Branson himself.

Contd…
 Brand acknowledgement is considered being a key
resource
 One of the common resources is finance.
 Financial standing of quick accessibility is not
occurring
 Different financial years are followed by some
organizations(Johnson 2014)

Contd…
 In late 2014, the revenue of the Virgin group was
£15bn.
 Only sixty organizations under the subsidiaries did
the using of the Virgin name (Johnson 2014)
 It is necessary to note the revenue source of
organizations will not include sales based profit

Contd…
 Another common resource is considered being
innovation
 Use of the VRIO (Value, Rarity, Imitable,
Organization) evaluation is done (Lechner 2017)
 Advanced knowledge will be received regarding
product value.

Contd…
 Human resources is another key resource
 It links separate Virgin companies
 Hiring of efficient managers are being done
 Fair treatment is received by them by feeling valued
and having satisfaction

Capabilities
 Major ability is varied organizational management
style
 Management refers to its internal operations
 Management also deals with the external
stakeholders (Johnson 2014)
 A hierarchical structure is being followed within the
different companies under Virgin group

Contd…
 Effective customer service is considered being the
means to survival.
 Virgin group is constantly keeping up with the
present requirements and demands (Lechner 2017).
 Actualization of customer needs should be ensured
 Virgin group is famous for its public relations

Contd…
 Product value as well as service value is considered
crucial
 Richard Branson makes an entry to a market having
demand
 Blue ocean strategy is functioning effectively to gain
competitive advantage (Johnson 2014)
 Separate companies are having distinct capabilities

Discussion on business that needs to be divested
 Divestment is required for businesses performing
poorly
 Better information regarding the company’s financial
performance cannot be actualized (Johnson 2014)
 Performances of the current scenario as well as of the
past are not considered being a better guide for future
potential (Lechner 2017)

Contd…
 The attributes of the business should be considered
 There is a list of strategic attributes relating to the
types of businesses for building the competing
advantages (Chen 2015)
 This will include the consumer businesses and start-
up businesses