Sir Richard Branson: Virgin
GB delves into Branson's new book finding a rare, maverick talent. Can he ever be emulated?
For more than 40 years, Sir Richard Branson has cut his own unique path in business. Like many successful entrepreneurs, he started out early, at 16, with a magazine called Student. By the early 1970s, he had begun Virgin Records and has since diversified into a dizzying array of industries.
No other globally successful business has attempted to do as many things as Virgin. As Branson notes: “Of the top 20 brands in the world, some 19 ply a well-defined trade. Coca-Cola specialises in soft drinks, Microsoft in computers, Nike in sports gear.”
Virgin is the exception and not the rule when it comes to how a business is run. While he has inspired many entrepreneurs, few are likely to emulate him or embrace the Virgin formula, if indeed one even exists.
The Virgin brand, which in Branson’s view is about irreverence and cheek, is key to his success. But companies that diversify often get labelled as being jacks of all trades and, for some, Virgin fits that bill. After all, the success of Virgin companies has been mixed.
Virgin Records signed many excellent artists and Branson’s airline, Virgin Atlantic, has given British Airways some serious competition. However, the buy up of NTL to create Virgin Media has had some serious problems, most notably a woeful standard of customer service, while Virgin Cola bit off more than it could chew when it tried to go head-to-head with Coca-Cola.
The Virgin brand is loved by many and has proved a major draw for a lot of consumers, but it is no magic fix. Even Branson admits there are times when the traditional view of business, focusing on one thing, is sensible. “You should focus on what you know, on what gets you up in the morning,” he says. “And for most people, that means one core business.”
But Branson isn’t most people, and what gets this seemingly hyperactive man out of bed in the morning is the challenge and the excitement of a brand that nearly didn’t come to life because of objections from the authorities about the sexual innuendo tied to its name. But can we expect there to be more Virgins in the future? Branson doesn’t seem too sure:
“Virgin may simply be odd – an accident of history,” he says. “I like fun. I began in a decade that prized fun. People associate me with that decade and the feel-good factor has stuck with me ever since.”
So is baby-boomer Branson, from a generation blessed with social and economic opportunities, the luckiest of them all? Well, he hasn’t been short of opportunities and has come close to disaster a few times – most notably when he was caught dodging purchase tax in 1969, which could have ended his business dreams. But then every successful entrepreneur needs a bit of luck and you can’t put all Virgin’s success down to that.
Branson’s real talent is his ability to find great people and set them free. He has employed some great managing directors, chief executives and senior staff, who have lived and breathed the Virgin spirit, run their sectors and been content to allow their boss to bask in the limelight.
Branson must be an excellent judge of character and says he’s always looking out for new talent. He reckons that by 1995, over 30 of his appointees had become millionaires, not including musicians. Some very successful entrepreneurs have also emerged from the company’s ranks, such as Innocent Drinks’ founders.
Effective man-management has been crucial. Empowerment, ownership of – and pride in – their work are themes that appear repeatedly in this book.
“However our staff are employed, every one of them should feel that, in some respect or other, they own their own work,” Branson says.
His people management is clearly strong, but every now and then the maverick appears. His appointment of Gordon McCallum to group strategy director, made from his bed when he was hung-over, is one humorous example.
Branson has made the most out of the chances that have come his way. He is an enthusiast, but has people who see it as their job to rein in their over-eager boss.
“The Investment Advisory Committee are my trusted lieutenants and they know almost everything there is to know about the Virgin global business. I’m rarely at their meetings – the team don’t like my interruptions and interference. I know this because they have a nickname for me. They call me Dr Yes – a parody of the Bond movie Dr No.”
Small is beautiful
Virgin is a massive group of companies, but he registers them in their own right, separating the risk and keeping the management close to the action. In the early days, Branson would simply break businesses in two once they got to a certain size. “I feel that small, compact companies are, generally, better run. This is partly because people feel more connected.”
Perhaps this is one of the reasons he has always managed to pose as the underdog or the little guy in the various tussles he’s had with big business – Sky TV, British Airways or Coca-Cola – over the years, even though he’s the billionaire head of a huge global business.
Branson wants to be seen as a ‘consumer champion’. Whether or not the public really believes this is uncertain, but he is well loved and, according to some surveys, trusted.
In part, Business Stripped Bare is an attempt to win the argument on several debates, such as his unhappiness with government decisions regarding Network Rail and the collapse of Northern Rock – on both counts this has led to nationalisation, much to Branson’s annoyance. Other targets include British Airways, which Virgin Atlantic has always enjoyed contrasting against. Yet there’s no mention of Sky TV or Rupert Murdoch, probably for legal reasons, as Virgin Media is battling them in the courts.
Words of advice
Business Stripped Bare is not a ‘how to’ guide for running a business Branson-style, and this is hardly surprising as there’s no real Virgin formula. But Branson recommends that entrepreneurs get out there where the action is taking place and take notes.
“I think company owners and chairmen should get out from behind their desks and go and sample their own products as often as possible,” he says. “I do see many bosses doing their rounds speaking to staff, but they never write the details down, so they will never, ever get anything sorted.”
So perhaps the secret of Branson’s success is having a very ambitious ‘to-do’ list and the fact that he’s managed to tick the biggest ideas off it. He’s a risk taker, a showman and has boundless energy – this book is actually tiring to read, simply because he has achieved so much.
But entrepreneurs don’t need to be like him to succeed. You don’t need to pilot balloons or space craft, take part in crazy publicity stunts or go to war against big business to be a great entrepreneur. That’s just Branson’s way. Don’t forget that he has also made a lot of mistakes, and owns up to many of them in this book. But he has still gone on to succeed, a lesson which is perhaps the most valuable of them all.