VIRGIN CASE STUDY

Virgin Case Study

Virgin Case Study

Introduciton

In an organization which possesses an environment that encourages intellectual stimulation, people get motivated to think about the problems, and strategies in different ways. Branson has created an organizational structure, where people have a strong sense of control and feeling of ownership over what they are doing (Kets de Vries 1998, P. 8).

Kets de Vries (1998) notes that charismatic qualities address people's inner questions- the why work, while the organizational structure, reward and the control system deal with the external world- the way they work (P. 8).

Effective leaders also look at the down side of large firms; this addresses the problem of large organization and their effects on employees. Economies of scale do not only come without diseconomies of size. As organizational units become too big, employees are less likely to get involved. Leaders like Branson address negative aspects of large firms and emphasize more on the concept of small are beautiful. Effective leaders also encourage flatter and decentralized organizational structure and also emphasize on lateral communication (Kets de Vries 1998, P. 9). Richard Branson's philosophy of working is simple; as soon as there are more than 50 people in an existing organization, he spins off to a new organization.

1) To what extent would you argue that the Virgin Group as an organisation is centralised or decentralised?

Virgin Group as an organisation is decentralized. Effective people according to Kets de Vries build partnerships and create commitment that involves others (Kets de Vries 1998, P. 8). Furthermore, leaders like Branson believe that strategic decisions should not be stuck in the upper level of the organizational chart, rather such long term decisions should be spread in the entire organization. This means pushing authority, responsibility, and accountability down the reporting line and flattening the hierarchical structures. The most effective leaders also recognize that the art of leadership comes from intellectual stimulation. This contributes in part to a "new vision" aspect of a transformation leader (Johns & Saks 2001, p. 287).

Furthermore, Branson looks at the kinds of people who are able to set their own standards, rewards themselves and have the tolerance of ambiguity. Employees at Virgin are constantly reminded about the customers. Branson runs his business in a very customer centred manner. Ken de Vries (1998) in his article says " first class passengers on Virgin Atlantic have free access to a far hole putting green at the Virgin club house and receive an in flight aromatic relaxation message (p. 9). Furthermore, Branson is also known to go meet personally with every passenger in cases of delay or technical error in the flight.

Transformational leaders also see the product life cycle shrinking way in advance, and such leaders plan ahead to enter into a new market at a rapid pace. Branson says " I can have an idea in the morning in the bath tub, and have it implemented in the evening" (Kets de Vries 1998, P. 9).

Branson can also be called a "people's person", because he values talented ...