Embry Riddle Aeronautical University
Professor Michael J. Sanderson, MBA
Virgin Group LTB
A mail order music company, a trans-Atlantic airline, mobile communications and much more make up this large but small company in each industry it enters. Using bravado and the press the brand has reached over 24 billion USD with small agile companies to become a top valued brand name in many areas. Using vertical and horizontal expansion the Virgin Group Ltb. (Virgin) has also taken the reins of supplying and producing for themselves and producing for others. As if it was its own nation it forges its own alliances with other countries for funding, and joint ventures with startups to develop new products and ideas. The development of virgin is a classic example of managing companies through networks and subsidiaries and international controls to be everywhere but know one working person working for something else than feeling like a start up.
"Everybody wants the next great thing. Even us. So we are a music store, who became an airline, who became a soft drink company, who became over 200 different businesses all over the planet united by one simple common thought:
We want to do what's never been done before.
We want to create stuff that's valuable. And honest. And is worth making in the first place.
We want to have fun while we're doing it.
And we want our competitors to find us really, completely irritating." Richard Branson Mission Statement 2012. This is an example of mission statement that is the brand and people based on the counter culture that he first started in. So the start of this mission statement he based his concepts that the company and him are inter twined. He even states that his goal is not to be #1 but be a brand of quality and to use the power of people rebellious streaks to strike at their competitors.
A comparative argument is made on whether the Virgin Group can be classified as a centralized or decentralized organization. These terms refer to division of power, capital, technical procedures and control in various units of a business. A centralized organization allows for minimal delegation to managers, with the chief executive retaining power over majority of the decisions.
Brand franchising is synonymous with the business strategies of McDonalds, Subway and various other organizations, especially in the fast moving consumer goods (FMCG) sector. The term refers to the process of a single corporation using its identity as a purchasable asset, due to the strong recognition that the brand holds among consumers (Buchanan & Huczynski, 2007). Where the brand’s franchise value is high, its name becomes a substitute for the product category name itself in people’s conversations. The main benefit that brand franchising offers business owners is the opportunity to raise the price of their products, allowing more freedom from price wars with competitors. The other obvious benefit of strong brand value is ease in extending the business or diversifying into other sectors and products. But more importantly, high value of a brand franchise empowers a business with a strong marketing tool, with a high return on investment (Buchanan & Huczynski, 2007).
Keiretsu is a prototypical type of business group that is strongly illustrated in the Japanese business system (Whitley, 1992). It refers to the interlocking business relationship and shareholdings that exist between a set of companies. Each company holds some form of ownership in the other, thereby ensuring a direct effect of performance on each other. The business relationship can be that of supplier and buyer, with each company also having management control or supervisory overview. The common structure of a keiretsu centres on a bank which lends money to all companies in that group, in return for equity, a monitoring entity and the