What Common Resources and Capabilities Link the Separate Virgin Companies?

Question 1: What common resources and capabilities link the separate Virgin companies?  

1. RESOURCES

1. REPUTATION

An important resource for Virgin group is the brand acknowledgement of its parent organisation (Kepner, 2017). But Virgin group cannot be separated from its’ founder, Richard Branson.  The two names are synonymous in the industries they have ventured in. The recognition of the brand name is imperative for the performance of many of its’ subsidiaries including Virgin trains, Virgin America, Virgin Mobile Australia and Virgin Holidays. (Rakesh – I took from the intro – please include the in line citation here)

Branson’s reputation as a bold investor has gained him a reputation as a successful entrepreneur.  That is not to say that he has not failed in any way, but to perceive when to pull out is an intelligent move. His strong leadership is vital to growing new capabilities for Virgin brand and has been given recognition even by Times and the UN (Rakesh – I took from the intro – please include the in line citation here)

1.2 FINANCES

Financial reports of the companies under Virgin group are not consolidated as not all the businesses are based under one umbrella. Financial standing is not promptly accessible, and some companies follow different financial years.

According to Financial Times in late 2014 (Ft.com, 2017), Virgin group’s revenue is £15bn. But only 60 of the companies under the subsidiaries used the Virgin name and the businesses are grouped under 7 sectors (Virgin, 2017). Also, one company’s profit cannot be offset against another company’s losses to get the accurate revenue for the entire group. Hence, having a complete picture is difficult to acquire.

But it is imperative to note that their revenue source does not only include profit from sales and services, but also from investments and royalty as well as from Branson himself.

1.3 INNOVATION

Innovation of its products is important. The Virgin group improves on the product quality and strives for top-notch quality. They increase the range of products and usability, introducing new style, technology, and is competitive with current products. Branson prides on the distinctive style and approach.

According to Chapman (2012), using the VRIO (Value, Rarity, Imitable, Organisation) analysis, Virgin group can get a better sense of the product’s value. Any product that has value, difficult to get from other places and not easily replaced can gain market share. Hence, Virgin group stays abreast with the ever changing trends and competition.

1.4 HUMAN RESOURCES

Branson is a brilliant businessman. He starts the companies and hires competent managers and does not shadow them. Branson treats his employees well.

As an agile entrepreneur, Branson learn from his strengths and failures in running a business and departs wisdom to his managers. For Branson, fun is an imperative component. He encourages all employees, not matter which level, to contribute.  As a result, his employees feel valued and find that the companies has good working culture.

1. CAPABILITIES

2.1 MANAGEMENT

One core capability is the organizational management style, which is different from one company to another. Management in this case not only refers to its internal operations but also in dealing with external stakeholders including investors, supplies, advertisers and customers.

Recently, Branson has started to lay hierarchical structure and delegate authority. This allows for autonomy for the companies in their management and marketing of the product.

The companies relies on its threshold capability of its leadership, brand and organisational strength to adjust to the opportunities and threats in the external arena.

2.2 CUSTOMER RELATIONSHIP

Key to survival is good customer service (Feloni, 2017).  Virgin group is continuously keeping up with the current needs and demands. The company strives to ensure customers’ needs are met and if not, it’s resolved, in addition to the standard and affordability of products.

The group is well known for its public relations and true to its’ founder, offers the Virgin experience for highly sought after customer satisfaction.

2.3 VALUE

Value of the product and services are imperative for its success. Branson enters a market that has demand, for instance in which the customer not satisfied with the available products or needs improvisation.  The blue ocean strategy works well to ensure most of their businesses will be able to gain competitive advantage and compete with rivals. Their value and innovation is one of their distinctive capabilities. Branson recognizes that if a product is redundant, it’s best to shut it down.