Branson should apply the following criteria when deciding on new diversifications: - It should add value to end users and communities in line with Virgin's brand of value, quality, fun and innovation. - It should benefit from Virgin's resources like its strong brand, management expertise, and ability to innovate in constrained industries. - The diversification should create opportunities for synergies across Virgin's existing operations through shared resources and capabilities.

1. VIRGIN CASE STUDY THE TEAM MILENA BANASZEK MONTY KHAN CHRISTOPHER PEAT LINDA RICHARDS FIRAT UCER

2. QUESTION THREE “What criteria should Branson apply in deciding what new diversification to pursue?”

3. CONTENTS Overview of Virgin Virgin’s beliefs Diversified companies Operational differences Operational Focus Resources and Capabilities Competitive advantage Virgin added value Focus of diversification Virgin checklist Conclusion

4. OVERVIEW OF VIRGIN Started by Richard Branson Leading entrepreneurial brand with 200+ companies Operates in a range of markets across 29 countries Complex Infrastructure Innovation in Industries Dubbed ‘Consumers Champion’ OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ over 200 companies ”

5. VIRGIN’S BELIEFS Value for Money Good Quality Brilliant Customer Service Innovative Competitively Challenging Fun OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ consumers champion ”

6. DIVERSIFIED COMPANY RANGE Main focus ‘related diversified’ ranges: Travel & Tourism Leisure and Pleasure Telecoms & Media Shopping Social & Environment Financial + other smaller operations Share Management, expertise, and funding OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ end user services ”

7. OPERATIONAL DIFFERENCES Virgin aim to: Seek new opportunities & Innovation within industries Build’s businesses, doesn’t buy Operate as Individual smaller companies Complex Virgin network Build business around people Give back to the consumer and society Strong CSR inline with core business OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ entrepreneurial spirit ”

8. OPERATIONAL FOCUS OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION DIFFERENTIATION FOCUSED DIFFERENTIATION INCREASED PRICE / STANDARD VALUE INCREASED PRICE / LOW VALUE LOW VALUE / STANDARD PRICE LOW PRICE / LOW ADDED VALUE LOW PRICE HYBRID “ increased value ”

9. RESOURCES & CAPABILITIES Resources Brand Finances Innovation Staff Capabilities Management & Marketing Increasing global presence Industry Links Identify Virgin ‘fits’ OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ end user services ”

10. COMPETITIVE ADVANTAGE VALUE Customer Focused Deliver superior quality Reasonable pricing RARE Risk taking Strong Leadership IMATIBILITY Richard Branson at the core Company values ORGANISATION Well organised Motivated through culture and OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION

11. VIRGIN ADDED VALUE Brand Value Shared labour resource pool Internal capital market Stretch and Resource Leverage OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ strong transferable capabilities ”

12. FOCUS OF DIVERSIFICATION OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION Ansoff’s Matrix “ seeking new products and markets ” Diversification Market Development New Markets Product Development Market Penetration Existing Markets New Products Existing Products

13. VIRGIN CHECKLIST Adds ‘Virgin’ value to the end user and community Preferred business start-up’s Results in end sale to customer Benefit from Virgin’s management Opportunity for Innovation in constrained industries Inline with brand, supports consumer OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION “ would it benefit from Virgin ”

14. CONCLUSION Continued diversification could lead to: Dilution of brand Management problems Reduced competitive advantage Strategic Diversification should lead to: Increased Profit Shared Value Competitive Advantage Aim to innovate in open markets, and concentrate in current markets to attain economies of scope OVERVIEW OF VIRGIN VIRGIN’S BELIEFS DIVERSIFIED COMPANIES OPERATIONAL DIFFERENCES OPERATIONAL FOCUS RESOURCES & CAPABILITIES COMPETITIVE ADVANTAGE VIRGIN ADDED VALUE FOCUS OF DIVERSIFICATION VIRGIN CHECKLIST CONCLUSION

15. BIBLIOGRAPHY www.virgin.com www.virginunite.com Virgin Case Study Contemporary Strategy Analysis, Grant R M The Challenge of Strategic Management, Arevuo M “ many Virgin sources ”

16. QUESTIONS ? “ thank you for your time ”