Virgin Group Success Businesses: Diversification, and Key Strengths
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Account and Financial Management Journal[pic 1][pic 2]Everant.org/AFMJVirgin Group Success Businesses: Diversification, and Key Strengths[pic 3]Zana Majed SadqDepartment of Management, Faculty of Humanities and Social Sciences, Koya University, University Park, Daniel Mitterrand Boulevard, Koya – Iraq[pic 4]ARTICLE INFO ABSTRACT[pic 5]Virgin Group is the largest private enterprise in the UK which includes of an assorted mix of businesses. It is considered to be one of the most worlds respected brand name and venture capital organizations established by Sir Richard Branson in 1970. The name Virgin has been selected to correspond to the plan of the firm being a virgin in every business it entered. The Virgin group businesses success increased in different sectors such as;corresponding Author:Zana Majed Sadqtransportation, music, financial services, soft drinks, mobile telephony, travel, and media.[pic 6]KEYWORDS: Virgin Group, capabilities, Key Strengths, and Diversification[pic 7]Introduction:Nowadays, Virgin is employing more than 50,000 people (Virgin, 2012), and createdapproximately 300 branded companies in 25 different countries. The major points behind the Virgins growth might be linked to Sir Richard Branson and Virgin brand name, with its unique culture of management style with minimal hierarchy and management levels (Grant, 2012). According to the Resource Based view, resources which are scarce, difficult to imitate, valuable and are not replaced by other resources are considered as a competitive advantage for the firm (Grant and Jordan, 2012). The Virgin groups core competence is their Brand name. The Brand name is difficult to imitate for its competitors. It has leveraged widely in many products and markets. It has also contributed to the end customer’s experienced benefit. Bransons businesses had the high ambition of expanding the business by using the brand name of the Virgin. That’s why the business of Virgin group did not stand still within some specific industries but expanded enormously. First of all, the Brand Name of Virgin is “valuable” inorder to the equity of the brand. Secondly, it is considered to be “rare” for the Virgin brand name because Virgin has positive perceptions of its customers, name linked with words like; innovative, successful, value for money, and the most important the trust to the Virgin groups businesses. The third point, “imitability”, Virgin over time, was successful to make brilliant reputation, therefore it is difficult for the competitors to imitate the Virgins products and services. Finally, Virgins competitors replace resources that might provide and supply to the same actions as equity of brand and corporate reputation.
Competitive advantage has been established by Virgin Group among its competitors by providing services and good value to the consumers in different ways. The Virgin Groups businesses basic and the core competence are to produce goods a little bit differently from the others. In addition, Virgin attempt to add value to the ventures by adding a little fun. Due to the differentiation in the Virgins strategy the ways of doing business and the fit of the activities also it differentiated from the competitors.Furthermore, Branson owned unique capabilities, such as his ability to successfully employ the media to grow Virgins public awareness, besides Bransons possesses of excellent charisma and superior negotiation skills. The capability of the Virgins unique culture of generating uniqueness and making differences, also the Bransons ability to maintain the unique companys management style and structure aid Virgin to be successful. Valuable capabilities will support the Virgin Group in the external environment to successfully search and analysis with attempts to minimise threats as well as looking for the opportunities. Capabilities have to be used efficiently, they will turn important and be hard to be substituted or imitated. Innovation is the Virgin Groups main marketing strategy, which it is about when a person has a new idea or a new product. Empowering workers to frequently offer not beatable consumer experience. This strategy generates a huge value that consumers are willing to pay a premium to have.Value chain analysis for Virgin Group:Value chain analysis is a strategic analysis of a company that focused on the serial process of value generating actions. The Virgin groups generic value chain which identifies the actions that might be separated to present a further in depth identification of the Virgins actions. Michael porters representation of the value chain distinguishes between primary activities (those involved with the transformation of inputs and interface with the customers) and support activities (Grant and Jordan, 2012, 126).Primary Activities:Inbound Logistics: In the organizations that present services, inbound and outbound logistics refer to design, solution, development and research (Dess et al, 2010). Virgin actions with devoted to make sure of the services and raw materials. Virgin works with suppliers on a high level, which has provided for many years, and thus cover the standard services and products (Virgin, 2012).Operations: Virgins product and services are high quality. Besides, Virgin has different websites for each activity thatoffer different facilities to its consumers, for example purchasing tickets online for airlines and trains.Outbound Logistics: Outbound logistics refer to distributing service or products to buyers or customers (Dess et al, 2010). Virgins product and services reach the customers with a fun, value, and success. Virgin is empowering employees and attempts to innovation services and products and offer it to its customers (Grant, 2012).Marketing and sales: Virgin to achieve competitive advantage is taking researches and doing analysis about the industry, with offering its services and product at a competitive price (Grant, 2012).Service: The major objective of Virgin Group is to provide high quality services and products through training effectively their employees and conduct the technique of innovation, with follow up the feedback of consumers (Grant, 2012).Supportive Activities:Firm infrastructure: Virgin is operating in 25 countries with 300 companies in the group, its owning many buildings, lands, plant and equipment, and Virgin gets across a lot numbers of different industries, such as financial services, industry of airline, music industry to the communication and computing services (Grant, 2012).Human Resource Management: Virgin Group carries a successful brand name over 43 years due to the high skills, experiences, intellect, talents of its employees and their desire to outperform, with the unique culture of management style with minimal hierarchy and management levels. Besides, Branson gives primarily credit to the human resources for the success of the company (Grant, 2012).Technology Development: The quick developments in digital technologies created a whole new field of opportunity for Virgin. Virgin group is extremely admired for its innovative application of information technology to professionally offer its services to the consumers (Grant, 2012).Procurement: Virgin stets its prices in the right direction and obtains services and goods at cheaper costs, which allows Virgin to keep consumers satisfied.Porter Five Forces analysis for Virgin Group:Porter’s Five Forces frame work help logically evaluate potential stages of risk, opportunity, and profitability depended on five components within a venture. It is used as a tool to better grow a strategic improvement over competing companies within a business in a healthy and competitive environment. It is classified five forces that specify the long term profitability of a market (Porter, 1998).