Question

Virgin was founded in 1970 by Richard Branson and is classified as a holding company for multiple ventures under the Virgin Group. When it comes to innovation Virgin is one of the top companies in the world. What began as a mail order record company has evolved into one of the most diverse companies in existence. Virgin invests in and builds companies that revolve around delivering fantastic customer experience and change the scope of industries. They do everything from space tourism to air travel, make comic books and video games. The company now holds over 200 companies and operates in 29 countries. They’ve found that the most successful ideas they get are the ones that are marketing, sales, and customer focused, sit under the Virgin brand, have a well-defined and differentiated customer offer and oftentimes are delivered in partnership with experts in their field.
Virgin takes the ideas it gets and boils them down into several categories. Anything that doesn’t quite fit into an existing company gets sent to corporate development for review. They take the time to read and respond to every proposal. They do not disclose how rewards are awarded but there are substantial ones for good ideas that are implemented. Internally Virgin also sources business plans and ideas from employees. Once a flight attendant had an idea. It got presented to the CEO and before long she had a considerable role in starting up Virgin Brides (which beyond being a fantastic idea didn’t quite work out in the market place). It’s incredible that a flight attendant can have an idea that makes it that far in a company. Notice that Virgin has over 200 companies under it. If you stop for a second you’ll realize just how massive that number is. That is a lot of innovation for a company only 40 years old. Financially they do quite well so obviously something has been working out for them. Not a lot of firms innovate this much or support this much innovation but that’s kind of the key – they don’t just source great ideas, they act on them. Sourcing this many fantastic ideas isn’t easy – it’s a lot of hard work for the company and they have to devote time and resources to going through all of them never mind actually taking the time to respond. But it shows that they care and that they’re serious about this. All great innovations come from an idea. Some go so far as to say it’s the most important part of the process (Seth Godin would likely disagree and say that shipping is the most important). Some companies looking at Virgin’s requirements might find them surprisingly strict, others surprisingly loose. No matter how you view it the only thing that remains true at the end of the day is that Virgin’s strategy works – and it works well.

Required:

What five lessons can other businesses learn from Virgin?

Answer 1

Answer - Five strategies that other businesses can learn are as follows:

• The foundation strategy of Virgin which paved its way was its focus on innovation. All the structural activities that led to Virgin's success are based on their fundamental emphasis on innovation. Virgin group believed that continuous innovation targeting increase consumer delight would help them gain their sustainable competitive advantage.
• The second lesson was its focus on customer experience and quality. They invest and formed tie-ups with other business which share a similar fundamental strategy of customer focuses approach driving business goals.
• One thing that differentiated them from others was they acted upon what they planned. Hard work along with efficient utilization of resources helped them work upon their plans successfully.
• Virgin believes that any idea can have the potential to make it big if analyzed and executed correctly. So in order to bring the best out of an idea, Virgin laid equal emphasis and analyzed all ideas across departments to crunch out the validity of the ideas.
• They have a diversified portfolio of business from space tourism, air travel, make comics books, and video games. They have a well-differentiated customer segment which helps them target the right consumer at the right time in the right way.