Presentation on case study

Presented by:
Abdul Naeem Junaid Alam Faiza Shakeel Bushra Aslam Sumaya Fazal Aliasghar Parekh

Presented to: Ms. Beenish kalim

The virgin group (intro)

The virgin group is one of the UKs largest private companies. y Annual turnover estimated at 3bn per annum by 2000. y Virgin highest-profile businesses was virgin Atlantic y The group spanned over 200 businesses from the financial services through to railway; such as entertainment megastores, soft drinks, cosmetics and so on
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The virgin group (intro)

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The virgin associated with words such as Fun Innovative Daring Successful And the founder, Richard Branson were high profile in British advertisements for apple computers together with Einstein and Gandhi.

Origins and ownership

Virgin was found in 1970 as a mail order record business and developed as a private company. y In 1986 the company was floated of the stock exchange with the turnover of 250 million. y The virgin has growing fast becoming profitable and entering and claiming a significant share of new market.
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Products of virgin company

Businesses of virgin group

Corporate structure of virgin

The structure of virgin group was so opaque that true financial position of virgin was unclear. y Due its status as a private company. y It was difficult to arrive at the accurate figure for the groups collective end of the year.
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Corporate structure of virgin (cont)

Historically, the virgin group controlled by Branson and his trusted lieutenants. y A structure of loosely linked autonomous units run by self-managed team that use a family brand name. y But the Branson's philosophy was that if a business got a certain size he would spin of new business from existing one.
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Corporate structure of virgin (cont)

The approach to management was one that decentralized decision-making with an emphasis on autonomous business-level. y In 2000 the head office consisted of 30 people. y Branson ruled with the loose rein by delegating to managers and giving them a leeway to use their initiative.
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Corporate rationale of virgin

The aim being to extend the brand name at low cost into selected areas. y Four main elements y It must be innovative y Challenging authority y Offer value by money being better than competitors. y Be good quality and market must be growing.
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Management style of virgin

Branson has sought out people with innovative ideas who are willing to start a new business. y Branson adopted his own personal style of management , y priding himself on actively involving employees and seeking their ideas on ways to further adding value to customers.
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Management style of virgin (cont)

The internalization of corporate meant greatly reduced need for external control. y But employees were still held accountable for their performance. y HRM systems were in place to keep people committed by stock options y Bonuses y Profit sharing y promotion
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Future challenges of virgin

The virgin highly dependent on the profits of virgin Atlantic. y this was troubling as the airline industry was cyclical and facing increased competition as a result of deregulation. y There were many business that seemed to be in losses. y Virgin cinema, virgin cola and virgin clothing all mad losses.
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Future challenges of virgin (cont)

Selling chunks of some businesses to fund new and existing businesses. y They sold a UK and Irish cinema houses. y Sold virgin music y Sold a 49 percent stake in virgin Atlantic to Singapore airline. y In 2001 seeking buyer for virgin sun and virgin express.
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Q.1 what is the corporate rationale of virgin .1 group? y The aim being to extend the brand name at low cost into selected areas. y There are Four criteria y It must be innovative y Challenging authority y Offer value by money being better than competitors. y Be good quality and market must be growing.

Q.2 are there any relationship of a strategic nature b/w business within the virgin group? Yes, there is relationship of strategic nature in the virgin group such as y The use of divestiture
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Q.3 does the virgin group as a corporate parent, add a value to its business? If so how?
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The Virgin Group, as a corporate parent does value to its business. It is achieved by the following points: Understanding of institutionalized Markets Virgin brand name to overcome barriers to entry Limiting Risk in joint Ventures Management are not restricted Innovation

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Q.4 what are the main issue facing by the virgin group and how they should be tackled?

The Main Issues Facing the Virgin Group are

Virgin Atlantic airline Virgin rail

Recommendations
Become Less Diverse y Change in Strategy y Accounting Year End
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