Strategic Management Essay Example | Topics and Well Written Essays - 2500 words

Strategic Management - Essay Example A group of companies that can successfully construct core competencies via its value chain functions to promote competitive advantages and then those capabilities may lead to synergies of that corporation.  Virgin is a motley collection of over 200 separate companies within main business lines- travel, lifestyle, media & mobile, music, and money. The whole virgin group covers the businesses ranged from airlines to bridal stores. There are only two things common to the diverse range of whole Virgin enterprises: Richard Branson as the founder and CEO of the group, all business units are under the brand name, Virgo. There is no parent company for the whole group and Mr. Branson once said each of the small companies are separate and has to stand on its own. Virgin group pursues Japanese keiretsu in addition to brand franchising strategy. Virgin member companies used to share a similar identity but possess their own independent operations.  Virgin pursues an unrelated diversification strategy with many product lines. Most companies diversify their business for the survival of their company, the extension of distinctive competencies to new businesses or in search of new competencies. Whenever Virgin diversifies its businesses, it is attached with the purpose of to make things better for the customers in the intended new industry. Diversification is known as the riskiest of the four strategies of the Growth.  Matrix: Market penetration, Product development, Market development, Diversification. It is said because diversification strategy needs to find many new competencies for a corporation such as new techniques, skills, etc. Thus, only a corporation that possesses some synergies to adapt well to the inexperienced field. After doing thorough research and appraisals for the next line of business concerning industry analysis and customer point of views, Virgin used to enter into that industry to create its brand name and excellent customer values and services.