Employee treatment and motivation

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Arizona State University *

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2018

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Business

Date

Feb 20, 2024

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docx

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Uploaded by jin213456

Employee treatment and motivation Branson should consider divesting in those businesses which are not being able to achieve their targets. However, this is subject to several issues which arise. Firstly, Branson owns and regulates companies most of which are run privately. Hence, these companies do not have the proper information that is based on their performance from a financial point of view. Secondly, the current performance of any company, as well as the past performance of the company, cannot determine the future endeavors which the company might undertake. For example, if the company has incurred losses in the past, then that cannot be the key to predicting future losses. Similarly, the business that has seen profits in the past doesn't need to be incurring profits in the future too. Therefore, what should be done is that the characteristics of both the companies of Branson and the Virgin group should be considered which have the prospect of adding value. The ‘strategic characteristics’ which can generate competitive advantage can be as follows:  The businesses are consumer-centric instead of the businesses which are producer centric.  The business should be a start-up business since Branson is skilled in creating businesses from the scratch and not the businesses which have already been established.

 The business should have space for the entrepreneurs to come up with their creative and innovative ideas to serve their customers loyally.  The business should consist of a dominant player which is ideally sedated and sleepy so that the Virgin group can stand against it as an innovative arriviste. These criteria will naturally eliminate businesses such as the rail services since they are not start-up businesses, Virgin is already the established regional monopolist in this industry, soft aerated drinks such as cola since it is difficult for the entrepreneurs to innovate new ideas in this business to serve the customers and the dominant players are active here instead of being sedated and sleepy, toiletries, financial services and also designer clothes. Branson can also contemplate divesting in businesses like the Virgin Atlantic Gateways. This is because recently the airlines are incurring losses. The Times had established that Virgin airlines were suffering from losses of 233 million pounds during the years 2010-2013. Virgin Airlines had failed to bring in profits for these consecutive years and therefore, this is a justified reason for Branson to consider divesting in this business. Another classic example where Branson might consider divesting is the Virgin Galactic. Virgin Galactic used the brand name of Virgin with a glory effect. If suppose the project of Virgin Galactic did succeed, then it would have boosted the Virgin group with the brand value. But unfortunately, this did not happen. The spaceship Two

of the Galactic had incurred losses. Therefore the brand reputation of the Virgin group of companies was lost. But, the brand name of this company, that is, Virgin group stands as the pillar of the empire, therefore, Branson should divest in this business even if that divesting is a part of the strategy of Branson. As already discussed in the earlier sections about the desirable characteristics of business where the Virgin group can generate a competitive advantage by recognizing the types of businesses. Beyond these, what should be done by the Virgin group of companies is that it should respect and value the limits to its brand image. Both the common resources, that is, the Virgin Group and Branson have undergone a common life cycle and the same generation of customers, for example, in the 1970s it has witnessed pop music, in the 1980s there was the presence of foreign travel, and finally in the 1990s, in investment products and the pension funds. The other crucial touchstone in the industry is that the Virgin Group should commence the businesses that are favorable and beneficial for making a good rate of profit margins. The examples of businesses that might fit all these characteristics may pertain to hospitals, health clubs, and private clinics which provide medical services.

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