Business Analysis of Virgin Group
- Length: 1170 words (3.3 double-spaced pages)
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Resources are being classified into tangible and intangibles assets as the followings: *Resources of *Virgin Group Tangible Resources Intangible Resources Capabilities of Virgin Group are established by the integrated resources that assisted it to stay competitive and to outdo its competitors. Valuable capabilities will aid Virgin Group to effectively tap and explore spotted opportunities as well as to minimize threats in the external environment. Should capabilities are consistently and effectively utilized, they will turn significant and be difficult to be imitated or substituted. With the resources discussed above, 3 capabilities of Virgin Group are identified as follows: - *Capabilities 1: Unique C*ulture of *"Making difference and creating uniqueness"* (*Contributed Resources: *Financial, Organizational, Human, Innovation*, Technological*) Creativity, Innovation are the foundations to Virgin and Richard Branson’s success! Technology push is the spine for innovation and likely to simulate process innovation in how service is provided when looking into Virgin. Technology is more likely to simulate process innovation. Every turn and businesses Branson venture has been with some kind of innovation or creativity element if not something unique, something that has not been seen or heard of before in the relevant market. Virgin Group has achieved a competitive advantage among its competitors by uniformly followed its culture in all business in serving good value and service to the customers in different ways. The basic and the core competence of all Virgin Group's business ventures are to do things just a little bit differently from the rest. And also they always tried to add value by adding a little fun to the business. By differentiating in strategy itself to fit of the activities and the ways of doing business have also differentiated itself from the rivals and make it difficult to imitate Virgin’s strategy. Hence, they have established their business to an untouchable position. How would you characterize the corporate strategy of Branson's Virgin Group? The answer to that question will not be so different from the ones above. However to better understanding we can characterize the corporate strategy of Virgin Group as "Making difference and creating uniqueness" in any kind of customers' service. They are not stuck to any business field so that makes them flexible of thinking and creating new ideas for their customers and the whole consumers around the world who need (or will need) Virgin's service.
Virgin Group aims to create a competitive challenge in their customers' eyes by creating fun, adding value for their money and providing quality. To do that they are following a direction of finding / inventing of new business ventures to add value and fun to customers. Their business is not only to create value to customers by finding / inventing new ways of doing it but also to go ahead for re-inventing / re-designing the businesses for specific needs of customer segments. Finding the right people and creating an environment in which they can flourish and build a profitable business. Learning by testing and making mistakes. Success depends on learning. = Treat employees as extended family. Hire the right people and give them responsibility to do the job without interference. Give them the freedom to be creative and innovative. Fully accepting that to learn and grow mistakes have to be made. Branson’s continuos endeavour to create exceptional brand equity has facilitated Virgin’s presence in the vast number of business it is in. The flamboyance and the lavishness of the “Virgin” brand together with Branson’s remarkable PR skills and outlandish acts has somehow managed to create certain amount of competitive advantage over the others. His peculiar manner to approach a business has to somehow worked for Virgin whether the decision to enter Airline business or Air Cargo Business in Europe all have been created on the basic premise if the Brand Value of Virgin. Brand Equity may be one of the most difficult elements in business to establish and Branson, through his team of core strategists, has done this successfully. It had successfully gain customer confidence with the company, enhance their buying experience and increase the chances of re-purchasing Despite the great uncertainties faced of being totally new in the market when venturing into an new business or untapped market, it was Virgin’s good brand and reputation capabilities which help to smoothly penetrate the market, create awareness of their products, to gain customers trust, bring in sales and to earn profit in a very tough industry. Virgin is able to break into the market and shake it up. Virgin’s role is to be the ‘consumer champion’; they do this by delivering their brand values. Their brand values are the themes the link the different businesses in the group. This is demonstrated by the impact of “quirky advertising and publicity stunts”. Branson initiative is to use, this is what has created his brand, some people recognise him as the brand, a survey was carried out to which The Virgin name was associated by respondents with words such a fun, innovation, success and trust, and identified a range of businesses, confirming what Branson and others had believed.” The greatest and most well known advertisement for Virgin is Richard Branson himself. Branson is often perceived as the consumer's hero, an entrepreneur operating in a style all of his own, and Virgin's brand values emanate from his personality. At the same time as being one of Britain's most admired businessmen, Richard Branson's daredevil antics, such as ballooning across the Atlantic, have given the Virgin brand additional publicity. e.g: Virgin Atlantic strives to provide the best possible service at the best possible value. It is a distinctive, fun-loving and innovative brand, which is admired for its intelligence and integrity. *Capabilities 3*:* Unique *Management Strategy The corporate work culture in Virgin where key executives played a much more important role than their formal function was synonymous with Branson’s disrespect for hierarchy and formal authority. Richard Branson’s capability of identifying emerging trends and continuous innovation in building his own and Virgin’s brand along with the company’s unique corporate culture all have elucidate its existence in diverse industries. *3. Core Competencies of *Virgin Group “Core competencies are capabilities that serve as a source of competitive advantage for a firm over its rivals.” (Hitt, Hoskisson & Ireland, 2007, Management of Strategy, page 80). Distinctive and value added capabilities are the basis of core competencies and core competencies helps a firm to potentially gain sustainable competitive advantage over rivals and are critical to its business strategies and future success. Core competencies will only be developed when the capabilities met the four criteria of being valuable, rare, costly to imitate and non-substitutable. Core competencies surface over time via the organizational process of building up and learning ways to integrate and deploy different resources and capabilities. Hitt, Hoskisson & Ireland, 2007, Management of Strategy, page 82). 3.1 Capability 1: Skills in customer relationship management 3.2 Capability 2: Good Innovative Marketing and Positioning This valuable capability is a core competency and a sustainable competitive advantage of SE as it met all four criteria that allow SE to earn above-average return.