The Virgin Group Essay

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The Virgin Group

1) What is the corporate rationale of the Virgin Group? Corporate rational is the way in which a corporate parent envisages the way that it can add value to its strategic business units. The Virgin Group sees itself as a restructurer; this means that it has low central costs due to relatively small corporate center, with fairly minimal involvement at business level. However they vary from the portfolio managers because they also set about trying to identify restructuring opportunities within their businesses and have the skills and expertise in order to intervene and introduce these changes where necessary. The Virgin Group have a huge range of about two hundred strategic business units ranging from airways to cola,
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3) Does the Virgin Group, as a corporate parent, add value to its businesses? If so how? I believe the Virgin Group, as a corporate parent, does add value to its businesses. The main way in which it adds value to the strategic business units is by the use of their brand name and image. This is very prominent and well recognised world-wide, and therefore gives each business unit instant recognition within their industries and therefore gives each business a strong external image to benefit from. Research shows that the Virgin brand was recognised by 96% of consumers in the United Kingdom, and 95% were able to associate Richard Branson's name with the brand. The brand name is also known for a huge variety of different businesses which shows the name has proved to be very versatile and can probably be put with most fields and brings an element of success.
I think the corporate parent has done very well to keep the Virgin brand well maintained, it started out as being about value and I think this belief still stands. However the name Virgin also brings about images of quality and of them being trustworthy. It is absolutely vital that when a brand name is used so widely it is portrayed in the right light. Any big stories in any of Virgin's strategic business units, if it portrays Virgin in a bad way, could affect all the other companies with the name Virgin attached to it, and consumer trust in them could waver. The
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