The Virgin Group of companies is one of the largest concern organisations in the universe. Founded by Richard Branson, the Virgin Group has established itself into many diverse aspects of the concern industry. This paper analyzes the organisational construction and civilization of the Virgin Group and how it has helped this organisation attain such success in many diverse industries. Much of the civilization of the Virgin Group is influenced by the personal beliefs and doctrines of its laminitis, Richard Branson, and is one of the grounds for the organisation ‘s success.
Branson extremely values all of his employees and takes personal duty to guarantee that his beliefs are instilled among all of them. Branson has created a decentralised construction in the organisation by giving his employees the authorization to take determinations thereby cut downing bureaucratism. Employees are encouraged to non ever follow rational processs and alternatively believe on their ain. This paper will first briefly give an overview of the Virgin Group of companies and its history and development.
The organisational construction and civilization of the Virgin Group will assist the reader understand the organisation ‘s procedures and concern patterns and how the values and belief system of its laminitis has shaped its construction and civilization. In add-on, the reader will larn how the Virgin Group has established itself as a successful organisation based on its construction and civilization. The paper will use some of the theories and constructs from the class text edition to the Virgin Group which will assist to understand the working of this organisation better. In decision, this paper hopes to stress the Virgin Group ‘s overall journey through the old ages and the function that its construction and civilization has played in its success.
About the Virgin Group
The Virgin Group is one of the most successful concern imperiums today. This organisation has established itself in diverse industries including nomadic telephone, retail, music, fiscal services, travel, and many more. Virgin has ruled the British market and has expanded worldwide into other parts like North America, Asia, Africa and Australia. Get downing out as a simple mail-order record retail merchant in 1970, Virgin has grown into one of the most successful concern imperiums in the universe. The Virgin Group has established more than 300 companies, using about 50000 people in 30 states. Its planetary grosss in 2009 exceeded US $ 18 billion. ( Virgin, n.d. ) The bulk of the Virgin Group ‘s success has been credited to the laminitis and CEO of Virgin, Richard Branson. Branson ‘s beliefs and doctrines are profoundly rooted in the corporate civilization of the Virgin Group. This has helped the Virgin Group to boom in today ‘s competitory concern universe.
History and Development
Richard Branson is the laminitis of the Virgin Group of companies. When he was a pupil at Stowe, he published a magazine called Student. The magazine was a success and it encouraged Branson to go forth school and seek his manus at new concern ventures. His first mark was mail-order records. He found that by seting a individual advertizement in an issue of Student magazine, he was able to set up a thriving concern with about no up-front investing and no on the job capital. The name “ Virgin ” was suggested by one of his associates who saw the name as proclaiming their commercial artlessness, while possessing some freshness and modest shock-value. In 1971 Branson opened his first retail shop on London ‘s Oxford Street. Virgin so expanded into the recording industry and the consequence was the Virgin record label. By 1983, the Virgin Group was gaining net incomes of 2 million lbs on entire grosss of merely under 50 million lbs. ( Grant, 2008 ) Gradually Branson expanded into other ventures.
The Organizational Structure
Many assume the Virgin Group to be a transnational, but such is non the instance. Each of the 300 uneven companies of the Virgin Group operates individually and Branson serves as stockholder, president, and public dealingss supremo. Most of them are runing companies that ain assets, employ people, and offer goods and services. These operating companies are owned and controlled by about 20 keeping companies. The Virgin Group has a really complex construction. It has been termed both as a trade name franchising operation every bit good as a keiretsu. ( Grant, 2008 ) However, based on its construction, the Virgin Group can be safely termed as an organisation with a keiretsu construction. A keiretsu is a group of organisations, each of which owns portions in the other organisations in the group, and all of which work together to foster the group ‘s involvements. ( Jones, Mills, Weatherbee, & A ; Mills, 2006 ) Furthermore, such a big organisation with a complex construction needs to be organic in order to be able to accommodate to alterations in its environment. An organic construction promotes flexibleness, so people initiate alteration and can accommodate rapidly to altering conditions. ( Jones et al. , 2006 )
Sing each of the single companies as a section supplying a alone merchandise or service, it is apparent that they exhibit merchandise departmentalization. Product departmentalization is the division of the sections of an organisation based on the type of merchandise or service offered. ( Jones et al. , 2006 ) For illustration, Virgin Mobile offers cellular services while Virgin Records is a music label. However, the construction of the Virgin Group is so complex that it is necessary for it to non merely hold one type of departmentalization. For case, Virgin Mobile has operations in many different states like the UK, India and Australia. As such, the type of service varies in each of these states. This shows that Virgin Mobile besides exhibits geographic departmentalization. Geographic departmentalization is the division of an organisation based on the geographic location. ( Jones et al. , 2006 ) In add-on, type of service and merchandises besides varies depending on the client base hence exhibiting client departmentalization. Customer departmentalization is the division of an organisation based on the sort of clients it serves. ( Jones et al. , 2006 ) Since the Virgin Group of companies exhibit so many types of departmentalisations, the organisation as a whole is said to hold a intercrossed construction, which is a mixture of two or more sorts of departmentalisations. This multi-divisional attack helps the Virgin Group to easy accommodate to the cultural, technological and other forces in the part it expands to.
The division of labor and the hierarchy is besides an of import facet of an organisation ‘s construction. The figure of degrees of authorization, the control, and the sum of communicating are cardinal factors in the proper working of an organisation. As mentioned, the Virgin Group ‘s companies operate as separate organisations. The companies are portion of a household instead than a hierarchy. They are empowered to run their ain personal businesss, yet the companies help one another, and solutions to jobs frequently come from within the Group someplace. In a sense, Virgin is a commonwealth, with shared thoughts, values, involvements and ends. ( Virgin, n.d. ) In fact, Branson himself has provided all his employees with the authorization to do unsupervised determinations based on their intuition instead than following a concatenation of bid. This leads to the employees holding more assurance in them and in the direction. Since interaction among all the degrees of the hierarchy is promoted, it increases effectual communicating. This is apparent from the fact that Branson personally interacts with employees on a regular footing discoursing thoughts and having feedback. The Virgin Group expresses autonomy and effectual communicating. Virgin has a level hierarchal construction and this enables speedy and efficient determination devising. The level construction is one of the grounds that the Virgin Group has been able to spread out into new ventures. In add-on, a level construction allows a wider span of control, and decentalisation. Span of control is the figure of subsidiaries a director manages straight. ( Jones et al. , 2006 ) The decentralised construction of the Virgin Group gives more power in the custodies of its employees when it comes to determination devising. Decentralization is the deputation of authorization to all degrees of the hierarchy. ( Jones et al.,2006 ) Branson believes that the employees are the anchor of the company and hence it is of import that they have adequate engagement and authorization in determination devising.
Since the Virgin Group comprises of so many companies, along with a decentralised construction, it should demo some marks of organisational bureaucratism. However, Branson has ensured since the beginning to minimise bureaucratism every bit much as possible since he strives to flatten the hierarchy. Bureaucracy is a construction in which people are held accountable for their actions because they are required to move in conformity with regulations and criterion operating processs. ( Jones et al. , 2006 ) The efficiency of the employees is enhanced under Branson ‘s leading who emphasises a broad span of control and self direction. Branson ‘s agnosticism of organisational hierarchy and a formal construction has contributed to organisational coherence to a great extent. His acceptance of this irregular scheme instead than traditional concern patterns and non-traditional structuring of the organisation may be the ground for the Group ‘s success.
The Organizational Culture
Much of the Virgin Group ‘s civilization is influenced by its laminitis Richard Branson ‘s personal doctrines. Merely as his employees are of import to him, so are the clients the Virgin Group serves. The ability of the Virgin Group to run efficaciously with about a non-formal construction is because of its alone organisational civilization. The civilization of the Virgin Group reflects Branson ‘s insouciant nature, his discourtesy for hierarchy and formal authorization, committedness to employees and consumers and his belief in difficult work and duty. ( Grant, 2008 ) This influences all of the companies in the Virgin Group and its organisational civilization. This in bend, enables the Virgin Group to supply an environment in which talented, ambitious people are motivated to make their best and strive for a higher degree of public presentation. However, even in an informal environment, a high degree of committedness, credence of personal duty and long hours of work when needed is expected. Performance inducements at Virgin for most employees are diffident but Virgin provides benefits like societal activities, company sponsored weekend pickups and ad-lib parties. ( Grant, 2008 ) Such an environment promotes better dealingss among the employer and the employees.
Virgin ‘s alone civilization has bit by bit progressed to where it is today. Virgin describes itself as a “ household ” stressing its informal but strong belief system and values. Possessing such a civilization enables the Virgin Group to hold effectual coordination among its assorted sections. Working as a community instead than a corporation, instils the ability to pass on efficaciously among the many companies in the Group. The Group as a whole plant together based on these shared set of values which are continuously strengthened. This is of import sing the huge size and complexness of the organisation. Following in the footfalls of its laminitis, Virgin has ever maintained the belief that the employees are the biggest force of the organisation and as such, should be treated with regard. ( Virgin, n.d. ) The direction cares for the public assistance of the employees and allows them to work in a free environment. Because of these primary beliefs and values, Virgin has been able to vie, thrive, and dispute new concern chances. As mentioned before, Richard Branson has influenced the civilization of the organisation the most. He has managed to instil his belief system into all of his employees and this has motivated them to endeavor to execute better.
One of the many strong points in Virgin ‘s favor is the fact that it is non-traditional ; radical even ; in the mode it does concern. Virgin believes in hold oning chances. Contrary to what many people may believe, Virgin ‘s invariably spread outing and eclectic imperium is neither random nor foolhardy. Each consecutive venture demonstrates their devotedness to picking the right market and the right chance. This has proved good to the organisation and is one of the many grounds for its success. ( Virgin, n.d. )
Based on the analysis of the corporate civilization and construction of the Virgin Group, it is apparent that it is a extremely successful organisation most of which ‘s recognition goes to the laminitis and his values and beliefs. Even though the industry considers much of his methods to be irregular, these methods have proved extremely good to him and the Virgin Group and have been deemed to be effectual. Not many today can woolgather of embarking into so many diverse industries get downing from abrasion. If Virgin continues to beef up its civilization and construction, it has the possible to go one of the most successful companies of all time.
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