Week 14

In your own words and using referenced quotes describe the difference between ‘business unit level’ strategy and ‘corporate level ‘strategy.

‘Corporate level’ strategy usually is concerned with the selection of businesses, by the top level tier managers and directors in which firm should compete and with the development and coordination of that portfolio of businesses. Its decision usually involves the direction of firm as a whole

‘ Business level’ is usually concerned for a particular product line or division. They can be planned independently, without the involvement of other business units of the firm. The strategies are developed by front line managers. They concentrate on developing and sustaining a competitive advantage for the goods and services of the firm

Discuss the corporate parenting style of Virgin group.

The Virgin Group is a group of independently run British companies with the Virgin brand under the leadership Sir Richard Branson. It was founded in 1970 and its core business area lies in entertainment , travel , lifestyle among others .

Virgin Group is different from many traditional firms , Virgin unlike many traditional firms has decentralized its organizational structure.  The power of decision making if given to the managers, this enables the managers to learn about business tactics and reduce the decision workload of chairman. Virgin Group also allows small firm to use its brand name as it gets international recognition. This would help both company to mutually benefit , small firm can promote itself very easily while Virgin will able to enjoy both the large scale and small scale company’s profits and worldwide recognition. 

The firm also takes full advantage of its chairman and founder celebrity status Sir Richard Branson. His entrepreneurial flair and charismatic style is a valuable assets which no firm can ever replicate. His personal qualities has enable Virgin to create and establish partnership with other organization. This will enable Virgin to gain more skills , knowledge and operational expertise from a whole range of different industries.

Fig:-Sir Richard Branson the face of Virgin Group

The parenting style of Virgin group is giving more freedom to different business unit.  Synergies are created between individual business unit office and corporate head office by regular interaction.  The freedom given to individual business encourages entrepreneurial skills in smaller business unit to pursue their goals effectively.  This freedom encourages better relationship and a good synergy between the parent  company and its different business unit 

Refernces 

Dess, G., (2007) “Strategic Management: Creating Competitive Advantages,” McGraw-Hill Australia

Dick, deVries and d’Avaucourt (2000) “The house that Branson built: Virgin’s entry into the new millennium,” INSEAD, Fontainebleau, France