Reference no: EM131700224
One of the big advantages that Sir Richard Branson (net worth: $4.2 billion) has in leading the numerous companies throughout the Virgin Group is the fact that his companies are (for the most part) privately held. There is no board of directors and no one to say, "No, you can't do that-it's irresponsible." Branson somewhat famously flirted with taking Virgin public but took it back to keep from having to answer to shareholders. Many of the Virgin companies are simply a reaction by Branson to something he experiences where he feels he could have done it better-especially in regards to customer service. The newest major entries are Virgin Hotels (expected to open in 2012) and Virgin America airlines. Branson and his charisma are very much a part of every endeavor. Upon Virgin America's recent opening of a regular flight into Dallas (an American Airlines hub and stronghold), Richard dressed up in a cowboy hat and boots and brought a bunch of cows with him to symbolize what American Airlines customers feel like and to offer an alternative to them.
In a move no rational business owner would make, in 2006 Branson pledged that all the profits from Virgin Rail and Virgin Air interests ($2.6 billion over ten years) would go toward tackling climate change. In a column for the Economist, Branson writes, "At Virgin, we have a long way to go, but we are also doing our best to make a positive impact on people and the planet." Branson believes that having a collective responsibility bonds teams of employees and creates a sense of pride in their work. At the same time, it's clear that Branson also has his eye on a different prize as well, as he believes that "solutions to global warming will create more wealth than any other business in the next decade." Branson also has the Virgin Group fund numerous entrepreneur-support groups, several charity-based foundations (Virgin Unite), and a plethora of awards and contests for technological advancements.
His visionary (and somewhat controversial) outlook and interests have instigated the recent formation of both Virgin Galactic and Virgin Oceanic. Formed by the Virgin Group, Virgin Galactic is the world's only commercial space tourism business. The company is currently offering flight tickets for $200,000 each for an hour's flight to space. Riders will only be weightless for approximately 5-6 minutes. The company will invest a total of $400 million with the hopes of sending the first flight up in early 2013. Although over 400 people have already bought tickets (the money si entirely refundable), the ability for the company to ever turn a profit is questionable. Yet, Branson is enamored with the idea of flight and space travel (he recently authored a book about the history of flight and flight pioneers) and so he makes it happen. Branson explains, "The reason I want to go: the Earth is tiny and space is infinitesimal. To experience things only a few people have. I love pushing boundaries." Similarly, he is fascinated with developing a submarine that will allow man to reach and map the depths of the ocean floor (over 36,000 feet underwater). Hence, the recent formation of Virgin Oceanic. Perhaps he can go exploring off the coast near his home-on his own private island!
1. Do you think it is easier to be a transformational leader when resources are almost limitless and the leader doesn't have others to answer to? Why?
2. At which aspects of transformational leadership would you say Branson excels?
3. If the Virgin Group were to go public tomorrow, knowing what you know about how Richard Branson leads the organization, would you be willing to purchase stock?