Virgin Case

Case: Strategic Development at Virgin 2013

SWOT Analysis of Virgin Group:

Strength | Weakness | Opportunity | Threat |

Strong brand image | Widespread use of brand | New Markets | Direct competitors providing same products or services |

Richard Branson himself | Informal management structure | | Strong name of Virgin but not necessarily strong products or services |

Diversified portfolio | | | |

Question 1:

There was growth in the range of products and markets served by Virgin. Virgin diversified in both related and unrelated strategy direction.

In related diversification involves expanding into products, services or markets with relationship to existing business. In other words, Virgin used its current resources, capabilities, competencies, core competencies and distinctive competencies to either develop new products to existing markets (i.e. Virgin Games is provided as part of leisure and entertainment industry to customers) or offer existing products to new markets (i.e. Virgin Records establishment in America).

On the other hand, Virgin diversified beyond its existing markets and products (conglomerate diversification) as in the establishment of Virgin Cosmetics. Such kind of diversification requires developing and allocating new resources, capabilities, competencies, core competencies and distinctive competencies in order to have a sustainable competitive advantage.

Question 2:

Virgin’s corporate rationale is all about good quality, value for money, brilliant customer service, innovation, and being competitively challenging and fun.

Question 3:

Virgin group as a corporate parent adds value to its businesses via envisioning, coaching and intervening activities. Virgin’s parenting role falls in parental developer type. Envisioning activity is mainly provided via the clear external image of Virgin’s brand name which adds great value to all its business units. Moreover, coaching activity is provided by training and developing...