Multinational Company : Virgin Group

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Virgin Group is an English holding company that was founded by Richard Branson and Nik Powell in 1970. It comprises more than 400 companies that operate in more than 50 different countries around the world. Virgin operates several businesses in the United States. Stiff competition from established players and legal restrictions are examples of challenges the group faced during its entry into the American market. Its successes include customer loyalty and provision of unique services. On the other hand, failures include the collapse of certain brands and poor performance of certain businesses. The group is successful because of Branson’s exceptional leadership as well as embracement of innovation and change.

History of Virgin Group

Virgin Group was founded by Richard Branson and Nik Powell in 1970 (Virgin n.d). It began as a student magazine that Branson founded while in high school. The group was officially incorporated as a holding company in 1989. The use of the phrase “virgin” connoted the founders’ lack of business expertise (Dearlove, 2007).

Virgin Group Development

The group started with the founding of a student magazine (Virgin n.d). The venture was successful and Branson used it as an entry point into the world of business. In 1970, he founded Virgin Records that was the first major lucrative business that he operated. Other businesses followed and by 1990, he had diversified his portfolio to incorporate businesses in various sectors. The key success factors for the group include Branson’s exceptional leadership, delegation of duties, innovation, and unique products and services (Branson, 2014). Branson has mastered the art of communication. This enables him to lead the group harmoniously. He delegates duties, listens to employees attentively, and gives them freedom to make critical decisions (Branson, 2014).

Why I chose Virgin Group?

Virgin Group is a global company that operates in different cultures. It is present in more than 50 countries around the world and employs people from different ethnicities, cultures, races, and languages (Dearlove, D. (2007). Its managers utilize different concepts of cross-cultural management. Workplace diversity is one of the challenges faced in workplaces that include people from different ethnicities and cultures (Velo, 2011). I chose Virgin Group because it has mastered the art of dealing with such challenges.

Virgin Group Market Entry

Virgin entered the United States through its airline business. America is the largest economy in the world and therefore has many opportunities for businesses. Branson relied on partnerships to enter the new market because of legal restrictions that limited his stake in the airline to less than 25%. The success of the airline encouraged him to venture into other sectors such as entertainment, leisure, health, and finance.

Virgin Group Market Analysis

Virgin Group offers several services in different sectors that include finance, leisure, finance, health, and travel. It offers fairly-priced services that enable it to attract customers and dominate certain markets. Some of its failures include rejection of brands such as virgin Cola and Virgin Cars as well as poor performance due to financial volatility. Successes include increased customer loyalty and provision of unique products and services (Hellriegel & Slocum, 2010). Virgin Group is able to provide unique services because of its willingness to embrace creativity and innovation.

Market Issues of Virgin Group

Stiff competition from existing players was the major challenge that Virgin faced when it entered the American market. Several sectors were already dominated by American companies. However, its companies innovated and dominated certain market segments. Legal restrictions limited the size of companies to create or the sectors to explore. For instance, the law restricted the size of ownership in an airline to 25%. Finally, harsh economic times and unemployment affected the demand for certain services that the group provided. This affected its revenues and growth.

Virgin Group operations

Virgin is a holding company because it owns numerous companies that have distinct business operations. In addition, it is a conglomerate because its businesses operate in different economic sectors. It does not produce goods and services but oversees the operations of its constituent businesses. In the U.S. virgin group owns several businesses that include Virgin America, Virgin Atlantic, Virgin Pulse, Virgin Casinos, Virgin Galactic, and Virgin Hotels.

Corporate Culture Background of Virgin Group

The company’s corporate culture is based on provision of quality customer service. According to Branson, employee motivation and empowerment is imperative and the key to job satisfaction, high productivity, and optimal performance (Hellriegel & Slocum, 2010). Interpersonal relations, accountability, and personal responsibility are considered as important aspects of the group’s corporate culture. The culture originates from Branson’s belief that motivated employees provide quality customer service.

Virgin Group Management

American tax policies, fiscal policies, and trade tariffs create a environment conducive to operating and expanding a business. Low inflation and unemployment rates ensure that the economy is stable and business friendly. Americans are known for their adherence to social and cultural trends that determine their spending habits. For instance, they consume more during the holidays. The United States is one o the countries that experiences rapid technological changes that affect business operations. Therefore, operating in the country is an opportunity and a challenge for businesses. Labor laws protect employees by setting limits for minimum wages and the treatment of workers. On the other hand, consumer laws protect consumers against manipulative business practices and transactions. The United States has laws that determine the ownership of a company founded by a foreign investor. This creates limitations and presents challenges that affect the implementation of growth strategies.


Virgin Group is a very successful company because of the exceptional leadership of its founder Richard Branson. In addition, embracement of innovation and change are key success factors. The company will be successful in future because of its focus on innovation and recruitment of highly qualified employees. On the other hand, its organizational culture will continue to create great work environments that will empower and motivate employees to do their best. Virgin Group will expand to new markets and provide services of high quality in order to guarantee its growth.

Virgin Group was founded in 1970 by Richard Branson and Nik Powell. The group comprises more than 400 companies that operate in more than 50 countries around the world. The holding company grew from a student magazine into one of the largest conglomerates in the world. Its embracement of change and innovation are some of the reasons why it will continue to grow and expand into new markets.


Branson, R. (2014). The Virgin Way: Everything I Know About Leadership. New York: Penguin Publishing Group.

Dearlove, D. (2007). Business the Richard Branson Way: 10 Secrets of the World’s Greatest Brand. New York: John Wiley & Sons.

Hellriegel, D., & Slocum, J. (2010). Organizational Behavior. New York: Cengage Learning.

Velo, V. (2011). Cross-Cultural Management. New York: Business Expert Press.

Virgin: About Us. (n.d). Web.

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