VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

VIRGINCASE STUDY

THE TEAM

MILENA BANASZEK

MONTY KHAN

CHRISTOPHER PEAT

LINDA RICHARDS

FIRAT UCER

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

QUESTION THREE

“What criteria should Branson apply in deciding what new diversification to pursue?”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

CONTENTS

Overview of Virgin Virgin’s beliefs Diversified companies Operational differences Operational Focus Resources and Capabilities Competitive advantage Virgin added value Focus of diversification Virgin checklist Conclusion

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

OVERVIEW OF VIRGIN

Started by Richard Branson

Leading entrepreneurial brand with 200+ companies

Operates in a range of markets across 29 countries

Complex Infrastructure

Innovation in Industries

Dubbed ‘Consumers Champion’

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“over 200

companies”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

VIRGIN’S BELIEFS

Value for Money

Good Quality

Brilliant Customer Service

Innovative

Competitively Challenging

Fun

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“consumers

champion”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

DIVERSIFIED COMPANY RANGE

Main focus ‘related diversified’ ranges:

– Travel & Tourism– Leisure and Pleasure– Telecoms & Media– Shopping– Social & Environment– Financial

+ other smaller operations

Share Management, expertise, and funding

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“end user

services”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

OPERATIONAL DIFFERENCES

Virgin aim to:

Seek new opportunities & Innovation within industries

Build’s businesses, doesn’t buy

Operate as Individual smaller companies

Complex Virgin network

Build business around people

Give back to the consumer and society

Strong CSR inline with core business

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“entrepreneuria

l

spirit ”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

OPERATIONAL FOCUS

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

DIFFERENTIATION FOCUSED

DIFFERENTIATION

INCREASED PRICE

/ STANDARD

VALUE

INCREASED PRICE

/ LOW VALUE

LOW VALUE /

STANDARD PRICE

LOW PRICE / LOW

ADDED VALUE

LOW PRICE

HYBRID

“increased

value”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

RESOURCES & CAPABILITIES

Resources

– Brand– Finances– Innovation– Staff

Capabilities

– Management & Marketing– Increasing global presence– Industry Links– Identify Virgin ‘fits’

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“end user

services”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

COMPETITIVE ADVANTAGE

VALUE

– Customer Focused– Deliver superior quality– Reasonable pricing

RARE

– Risk taking– Strong Leadership

IMATIBILITY

– Richard Branson at the core– Company values

ORGANISATION

– Well organised– Motivated through culture and

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

VIRGIN ADDED VALUE

Brand Value

Shared labour resource pool

Internal capital market

Stretch and Resource Leverage

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“strong

transferable

capabilities”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

FOCUS OF DIVERSIFICATION

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

Existing Products New Products

Existing Markets

Market Penetration

Product Development

New Markets Market Development

Diversification

Ansoff’s Matrix

“seeking

new products

and markets”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

VIRGIN CHECKLIST

Adds ‘Virgin’ value to the end user and community

Preferred business start-up’s

Results in end sale to customer

Benefit from Virgin’s management

Opportunity for Innovation in constrained industries

Inline with brand, supports consumer

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

“would it

benefit fro

m

Virgin”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

CONCLUSION

Continued diversification could lead to:– Dilution of brand– Management problems– Reduced competitive advantage

Strategic Diversification should lead to:– Increased Profit– Shared Value– Competitive Advantage

Aim to innovate in open markets, and concentrate in current markets to attain economies of scope

OVERVIEW OF VIRGIN

VIRGIN’S BELIEFS

DIVERSIFIED COMPANIES

OPERATIONAL DIFFERENCES

OPERATIONAL FOCUS

RESOURCES & CAPABILITIES

COMPETITIVE ADVANTAGE

VIRGIN ADDED VALUE

FOCUS OF DIVERSIFICATION

VIRGIN CHECKLIST

CONCLUSION

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

BIBLIOGRAPHY

www.virgin.com

www.virginunite.com

Virgin Case Study

Contemporary Strategy Analysis, Grant R M

The Challenge of Strategic Management, Arevuo M“many Virg

in

sources”

VIRGINRICHARD BRANSON AND THE VIRGIN GROUP OF COMPANIES IN 2007

QUESTIONS

?“thank you

for your

time”