Virgin - Corporate Strategy

1. Genesis of the Virgin group :

The Virgin Group is one of the UK's largest private companies, with a turnover about 21 billion US dollars in 2008. The famous Richard Branson, a successful businessman, has founded the group in 1970. The group own more than 200 businesses, and they are very different, from financial services through to railways, from entertainment mega stores and soft drinks to cosmetics and condoms.

The group always uses the brand “Virgin” in his subsidiaries, because it means success, fun and innovation in consumers’ mind. And Richard Branson, is one the of the reason on the Virgin’s success, because he has a very good image for the consumers.

2. Corporate Structure

The structure of virgin is not very clear, not transparent, but one model of organization has been adopted as a 'keiretsu' organization, which is a structure of loosely linked autonomous units run by self-managed teams that use a family brand name, in this case “Virgin”. They have a lot of short-term objectives running by aggressive campaign when the brand enters a new market. Historically, mainly Branson and his trusted employees and partners had controlled the Virgin Group. The approach to management was one that decentralized decision-making, with an emphasis on autonomous business-level decision-making and responsibility for their own development.

To sum up, the subsidiaries are very autonomous, but they can deal with Virgin original competencies and funds. They are very innovative and adopt a very risky strategy because they have to propose something new. The strategy is not to do the same as the competitors but to build a competitive advantage by being innovative.

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