The Analysis of the Virgin Group Ltd.

Berkeley College

The Analysis of The Virgin Group Ltd.

Expounding on the Firms Overall Structure

Troy Holas

Principles of Management  MGT 220

Prof. Leslie-Ann Garraway

Troy Holas

Professor Garraway

MGT 220

March, 2015

The Analysis of The Virgin Group Ltd.

When I think “Virgin”, the word successful immediately comes to mind. The Virgin Group is undoubtedly one of the most affluent business enterprises to date. The Brittan based capital conglomerate was envisioned and founded by entrepreneurs Richard Branson and Nik Powell. The Virgin Group Organization has held a prominent position in industries such as leisure, music, world travel, mobile telecommunications, financial services, health care and many more. This multinational enterprise not only dominates it’s British market, but has also expanded and thrived throughout international regions such as, Africa, Asia Australia and North America to a lesser extent. To date, The Virgin Group has established more than 300 individual commercial companies and has employed almost 50,000 people worldwide.

         Richard Branson, the founder of the Virgin Conglomerate, began his business venture by branching his very own magazine publishing into an establishment that sold records by post. His ultimate aim was to eliminate high street retailers. After opening his first retail record store in London, he completely dominated the market. At this point, the name “Virgin” was given in reference to the company’s so called “commercial innocence” at the time. Both Branson and his associates believed that the name possessed novelty and a modest but everlasting punch.

Following the success of Branson’s retail store came the birth of his very own record label. That too turned into gold, signing the likes of artistes such as Tubular Bells and the infamous Janet Jackson. Virgin Records was then sold two decades later to EMI and soon after Virgin Atlantic Airline was born, a high profile venture that took “Virgin” to the next level. This was just the beginning, Virgin group expanded tremendously, tapping into almost every niche of today’s global market.

The Virgin Group’s philosophy states that “The heart of Virgin’s core strategy is to develop the five pillars of the business empire: travel, leisure, mobile phones, entertainment retailing and personal finance”. This ideology can be listed as one of the most crucial factors of Virgin’s strategic plan and overall success. The Virgin Group is well known for emulating its strengths and vast opportunities throughout their numerous lines of product markets. With that being said, it is quite obvious that Virgin holds a relatively complex structural format. Many have described it as a “brand franchising operation” as well as a “keiretsu”. In other words, it may be described as a structure based on autonomous Businesses, governed by self managed groups that all share a single branded name. Virgin at the same time also promotes a structure based on “organic” traits and flexibility. This allows people to initiate change and keep abreast with rapidly evolving conditions. These private conglomerates all share one key advantage; short-term goals can be ignored, thus resulting in the allowance for full concentration on long-term profits.  Virgin Is comprised of numerous individual companies each providing a specific product or service so it’s quite evident that they portray some sort of product departmentalization. Product departmentalization is described as the division of the departments of an organization based on the type of product or service to be offered. (Jones et al, 2008). The Virgin organization is considered to have a hybrid structure. This term is given when a company possesses more than type or a mixture of departmentalizations. In this case, geographic and customer departmentalization is clearly demonstrated. This “multi-divisional” technique has aided Virgin dramatically when in comes to adapting to cultural and technological customs of any location or region they expand to.