Discuss about the Entrepreneur Analysis for Richard Branson.
The following report is going to discuss about the entrepreneurial characteristics of Sir Richard Branson of the United Kingdom. Sir Richard Branson is a British entrepreneur, the founder and the director of the company Virgin Groups. Richard Branson has been one of the greatest and highest rated entrepreneurs in modern business world. Richard Branson started his business at the age of sixteen, which he initiated through a magazine called “Student”. His first venture for the Virgin group was noticed during the 1970s when he opened his record store called The Virgin Records. His greatness of entrepreneurship was established when he was rewarded the Knight in March, 2000 at Buckingham Palace (Storey et al., 2016).
The following report is going to recognise the characteristic traits of Richard Branson as an entrepreneur. It further tries to analyse the mode of his business dealing; to figure out the business challenges he has faced in his course of entrepreneurship; to study the mode of endeavours he has taken to resolve the issues in his corporate organisation; and to summarise the type of entrepreneurial segment he belongs to.
Before categorising the entrepreneurs, one needs to understand what the term suggests. The term entrepreneur is quite a vast concept. There are some obvious differences between an entrepreneur and a businessperson. A general business definition of entrepreneurship can be stated as the following: Entrepreneurship is the business venture that is developed through the willingness of organising and managing the tasks in order to gain and maximise profit. However, the term is most associated with the start up of a new business venture. A successful entrepreneur is highly innovative and ready to take any sort of risk while doing business. The success of an entrepreneur depends on the innovative way taken in order to resolve the issues in a business. Hence, proper risk management and development of proper organisational culture are the key factors for an entrepreneur to become successful. There are basic four types of entrepreneurship:
According to (Mair, Robisnson & Hockerts, 2006), social entrepreneurs are those who develop their business by generating new ideas about the product or service they would like to deliver in the market. Richard Branson is of no exception. Branson’s journey of business from opening a magazine and music record company to creating global service in different fields has been quite spectacular and innovative. He can thus be regarded as a social entrepreneur. Richard Branson’s idea on “conglomerate business” has proved to be a perfect assimilation of creating new genre and making extreme profit. However, the journey of Sir Branson has not been an easy one. He has been creating his business type in different sectors and industries. The bestselling autobiography of Sir Branson, “Loosing My Virginity” has chronicled different modes of business strategies that he had taken in his business career (Branson, 2011 ). The book depicts his hardships and achievements in performing business through conglomeration with different companies. Virgin Corporation has now become the largest business corporation in the United Kingdom.
Richard Branson is no doubt a legendary entrepreneur. He has struggled for establishing his business from the beginning of the 1980s. In the 1990s, he lost his first business venture and literally cried for the loss. However, there are certain criteria that have made this person such great. These are as follows:
The major strength that Branson has is his idea of expanding the business. Richard Branson, a high school drop-out, established his first business of magazine in 1966. He has the idea of free distribution of his magazine in its first year. Such idea of promoting a product was quite inventive in its nature standing in the 60s. However, he managed to recover the making cost through advertisement. His idea of target audience proved that he knew how to deal with the market. He chose the youth segment of the society as his topic. From the cultural venture of business, he moved to open his recording studio in 1972. This was done in order to support his founding business of magazine, “Student”. Till 1990 the Virgin studio became one of the leading recording platform in the country and Richard Branson did not stop expanding his business. Now his Virgin is a conglomeration of different companies dealing with different sectors and industries.
The strongest advantage of a successful entrepreneur is that he or she keeps striving for making his or her own fortune through business venture. When Thorn Emi took over Virgin Record in 1992, Richard Branson was the most distressed. The decade of 90s had a bi-productive effect on Branson’s business career. His constant struggle was immediately recovered by founding Virgin Radio. Then he started expanding his business by establishing V2. At present, the Virgin Group holds more than two hundred companies in more than thirty countries. His business venture has not been captivated in recording studio. It has rather expanded through owning Train Company, mobile and communication sector, gaming sector and so on.
The theory of Joseph Schumpeter states that the success of an entrepreneur depends on how innovative one thinks and executes. The innovation has different phases in different industries. However, the basic phases are, the innovation in production, innovation in selection of the products or services or the both, innovation in marketing style, innovation in dealing with human resource and so on. Branson’s innovation was vividly noticed when he chose the topic for the first edition of his magazine. The topic of pertaining to the issues faced by the youth in British society was quite contemporary. In his recording business, he kept working with the most suitable artists. Branson’s entrepreneurial attitude fulfilled all the required criteria of the theory of innovation that was designed by Joseph Schumpeter (Kuratko, 2016). Following checklist validates his fulfilment of theory of innovation:
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Criteria (Entrepreneurial Innovation Model ) |
Checklist |
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Introducing New Product |
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Introducing New Production method |
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Opening of New Market |
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Identification of New sources of supply |
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Introducing New Organisation in Industry |
Fig 1: Checklist on Validating Branson’s Business Innovation
Richard Branson’s entrepreneurial orientation has been measured upon the success of his brand i.e. Virgin. The Global reflective Measure theory in Entrepreneurial Orientation suggests that an entrepreneur needs t be globally oriented with his or her business. This is performed by using risk-adverse managerial philosophy. Branson’s orientation with risk has been repeatedly noticed when he ventured new business in railways. The railway business is considered the most risky one in the business world. However, Virgin Trains in collaboration with British railways has been doing fair business. The most successful endeavour of Branson was the decision of designing new trains with the assistance of modern technology. The next venture of Branson was noticed in 2007 when decided to launch virgin Airways and executed the pan perfectly. The intervention into the railways and airways has proved that virgin group under the leadership of sir Richard Branson is not going to halt from expanding business ideas and executing them in reality (Baum, Frese & Baron, 2014).
According to the trait theory, an organisational leader or an entrepreneur must possess a certain characteristic trait that helps him or her become the most adored leader in the industry. Entrepreneurial attitude and behaviour can be discussed through different categorical representations. An entrepreneur applies his or her characteristic traits in their organisational process to inspire the employees. Recent interview with richer Branson by a news channel reflects his nature as an entrepreneur and corporate leader. His orientation with the employees has been praised by many. He has perfect leadership quality. He always strove to build a team. This nature is quite evident in his first venture with the musical studio Virgin Record. The Virgin group has thousands of employees and they are scattered in different countries in the world. The Virgin Air Asia has also confirmed the nature of business cohesion through the leadership of Richard Branson. In an interview, he revealed that “touch method” really helps in understanding and communicating with the employees (Abubakar, 2016). He believes that by touching or patting the employees one can easily make them believe that the boss is with them. Such philosophical intervention in the business sector is quite rare and he has proved to be one of the greatest business leaders of the world (Higgs & Dulewicz, 2016).
In spite of huge business success, Richard Branson has come across his struggle period in the 1990s. The first scarcity fell upon him when his company was sold. He began to redesign the structure of Virgin through assembling different sectors. This was the period when he designed some of the greatest business ideas (Acs, Audretsch & Lehmann, 2013). The next crisis period was faced by Richard Branson was in the recent years when he eliminated Virgin America from his business wings. In the very first years of his business with the British railways, he faced huge business loss as he introduced new model of train that was technologically quite advanced but expensive. Therefore, the next venture from Virgin Trains was to make good use of the market demand. According to the growing market demand in different countries, he stepped in with his business and franchise ideas (Sanford & Fullerton, 2014). The biggest strength lay in that fact that Branson did not focus on a single business field. He rather intervened in business like mobile business and tourism business. The Virgin Asia Airways is one of the highest voted companies in the continent. He holds more than twenty different individual business fields in his conglomerate (Johnsen et al., 2017).
The most common setback that has been found in Richard Branson is that he never talks about extending his business in a particular business field. He keeps experimenting with different types of business sectors starting from service sectors to heavy manufacturing industries. This may bring risk in further business endeavours. Continuous increase in the types of businesses in his conglomerate may fall into utter disruption (“Frustration leads to disruption”, 2017)
The multifaceted ventures of Richard Branson have caused utter failure in different industries. More than ten of his business initiatives failed to crack well in the market due to lack of proper insight and availability of hardcore competition. Following business of Richard Branson utterly failed from doing well in the market:Virgin Cosmetics: Virgin Cosmetics were the worst businesses venture ever taken by Branson. His urge for handling multiple businesses at a time cost him a lot. Virgin Cosmetics were sold out in the year 2009.
Virgin Cola: Due to hardcore competition from Coca-Cola and PepsiCo, Virgin cola could not even stand well in the market. To some extent, it tried to look into the local markets of individual countries like USA where it managed to hold 0.5 % business share. However, in 2012 it stopped its production and was sold out in later years (Hulsink & Rauch, 2015).
The Virgin brand had pretty much talk about its future in different business. However, some of the businesses were tremendously successful and some were disgrace. The basic set back of Branson is that he did not specify his business criteria. He seems to be scattered in dealing with the business industries. It happens when someone is not well organised in creating thought. I think, Richard Branson does not belong to an industry like Bill Gates or Mark Zuckerberg does. Sir Richard Branson is more a company’s man. With the dynamic dream to capture every possible business sector under the realm of Virgin Group Branson paved his way, which led to two different roads- extreme success and utter failure. This approach of Branson is highly commendable in terms of business ethic. History of the virgin Group says more than fifteen ventures were either sold out or stopped due to low sales rate. Inconsistency in business raises question against Branson how far he understands market competition and continuation capability (Engel, Kaandorp & Elfring, 2015, January).
Despite several incidents of failure, Richard Branson came up with different innovative ideas to recover the wounds in the market. The basic change he did in his companies was that he strengthened his human resource department. Richard Branson is known to be the employee’s boss as he has always been supporting the employees in different hardships. The technological enhancement n his tourism sector was a great move to grow interest among the tourists to avail through Virgin Group. He himself visited the spots where his business ran flop and he tried to analyse the problems. Direct interaction with the employees and the customers made him become a successful entrepreneur, even one of the greatest of all time (Grant, 2016).
Conclusion:
The best part of Richard Branson is that he has never undermined his own technique despite constant criticism from the business scholars and experts. This is how he developed his own idea of dealing with multiple business types. He involved in the grass root level to solve the problems of the company and tried to solve them.
Reference:
ABUBAKAR, S. G. (2016). Examining the Culture of an Organisation, Its Leadership Styles, Structure, Diversity Issues and Conflicts: A Case Study of Virgin Atlantic, United Kingdom. Development, 4(2).
Acs, Z. J., Audretsch, D. B., & Lehmann, E. E. (2013). The knowledge spillover theory of entrepreneurship. Small Business Economics, 41(4), 757-774.
Alter, S. (2014). How to market like Richard Branson. Journal of Property Management, 79(6), 14-15.
Baum, J. R., Frese, M., & Baron, R. A. (2014). The psychology of entrepreneurship. Psychology Press.
Branson, R. (2011). Losing my virginity. Random House.
Branson, R. (2013). Like a virgin: Secrets they won’t teach you at business school. Random House.
Bruton, G., Khavul, S., Siegel, D., & Wright, M. (2015). New financial alternatives in seeding entrepreneurship: Microfinance, crowdfunding, and peer?to?peer innovations. Entrepreneurship Theory and Practice, 39(1), 9-26.
Engel, Y., Kaandorp, M., & Elfring, T. (2015, January). Entrepreneurial Networking Under Uncertainty: An Effectual Lens. In Academy of Management Proceedings (Vol. 2015, No. 1, p. 13031). Academy of Management.
Frustration leads to disruption. (2017). Virgin. Retrieved 26 March 2017, from https://www.virgin.com/richard-branson/frustration-leads-disruption
Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.
Higgs, M., & Dulewicz, V. (2016). Developments in leadership thinking. In Leading with Emotional Intelligence (pp. 75-103). Springer International Publishing.
Hulsink, W., & Rauch, A. (2015). Learning to take the entrepreneurial plunge. RSM Discovery-Manage
Johnsen, C. G., Johnsen, C. G., Sørensen, B. M., & Sørensen, B. M. (2017). Traversing the fantasy of the heroic entrepreneur. International Journal of Entrepreneurial Behavior & Research, 23(2), 228-244.
Kuratko, D. F. (2016). Entrepreneurship: Theory, process, and practice. Cengage Learning.
Mair, J., Robinson, J., & Hockerts, K. (Eds.). (2006). Social entrepreneurship (p. 3). New York: Palgrave Macmillan
Sanford, C., & Fullerton, J. (2014). The responsible entrepreneur.
Storey, J., Hartley, J., Denis, J. L., Hart, P. T., & Ulrich, D. (Eds.). (2016). The Routledge Companion to Leadership. Routledge.
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