Competitive Advantage Strategy

Running head: Strategic Frame Assessment 1

BUSINESS STRATEGIES AND MODELS

Strategic Frame Assessment

James Smith

MBA 6024 Unit 1 Assignment 1

2/27/16

EXECUTIVE MEMO

To: Vice president, Teri Bell.

From: Marketing manager.

Re: THE VIRGIN GROUP STRATEGIC MODELS AND FRAMEWORK.

Firm’s business and corporate strategies.

Virgin group, being a huge conglomerate organization with hundreds of subsidiary companies, has laid out business strategies which differ from one organization to another. These are the decisions which a firm is involved in and makes while in the process of maintaining, creating and making use of advantages in the market for better competition methods. Small business owners, can identify where competitive advantage may be best exploited through evaluation of the company’s competition, product line, target market and market gaps. Keeping costs low and choosing differentiation of products could be effectively used(Jensen, 2000). However, a firm which chooses to keep costs low may not meet the profitability targets set thus would prefer using differentiation as a strategic plan to lure customers into purchasing the company’s products. This company could also emphasize on freshness, quality ingredients or some other attributes that consumers will value highly enough to pay extra. This firm’s strategy is diversification of products, which creates a variety for customers, hence enables customer attraction and retention for the organization.

Corporate strategies undertaken by the firm are such as mergers, franchising and adopting globalization. When an additional business is incorporated into the firm, making decisions on corporate strategies is a critical step. The firm needs to be aware of the need to be effective in all projects it undertakes and profitability levels it aims at, in the global and local market levels. Selling volumes enables the firm to enjoy economies of scale and this is a clear way to conquer emerging competition from all fields.

How the firm competing and applying business and corporate strategies.

The firm competes through production of differentiated products. The application of matrix, hybrid and cost minimization strategies did not work well for the firm as other factors were greatly compromised. Use of differentiated products has led to the increased number of sales and thus profitability. This is the method used to counter competition and has proven to be more effective than other strategies, as customer satisfaction is assured. Diversification is applied through thorough market research, which enables marketers to identify gaps in the market, consumer trends and preferences.

Competitive game plan.

Workplace diversity has been emphasized over the past several years. This is due to the benefits it brings along with it and the creation of equal opportunity to all members in an organization. In my view, diversity awareness involves the recognition by employees of the importance of the existence of several groups at the workplace is an important issue in an organization. This entails harnessing and encouraging the existence of different personnel in an organization, which is entirely to the organizations advantage. Product diversity has also seen to the firm’s success over the years. Customers prefer differentiated brands, where they can make choices and select the brands they prefer rather than being tied to accepting a single set of products (Watson, 2005). This is a critical step for the firm and the advantages of this type of measure have been clearly monitored. The firm has gained a strong market position and an added competitive advantage.

The firm's business model. What is the customer value proposition? What is the profit proposition?

The business model used is that from the manufacturer, retailer and finally the consumer. With this, a shorter chain of distribution is enabled thus cutting costs for the firm. Cutting costs is an effective method of generating funds for the firm. This is through minimization of expenditure thus keeping cash inflows higher than the outflows. Virgin Atlantic’s promotion has a positive impact on consumers. The main aim of this company is to ensure customer satisfaction and profit maximization at the same time. The huge company has made a global name for themselves and its promotion has played a big part in this. The customer value proposition for virgin Atlantic include all the overall advantages or benefits that their customers will derive from being their partners in business and being part of them in general. Prices are cut down to see to it that customers are pleased, and the issues of quality and support are offered to the company’s clients. These go hand in hand with the company’s profit propositions as the firm, through application of promotional techniques has been able to counter competitive forces and remain the best service providers in the regions it operates.

The firm's corporate strategy, including product, geographical, and vertical scope in which it operates.

Products and services provided by the virgin group of companies are: travel, leisure, mobile, media, holidays and more. For the virgin group of companies to have attained such levels of success in the corporate world, it must have a hugely thought out and effective marketing mix achieved through the four key elements; product, promotion, price and placement. This has led to the firm taking part in expansion activities from its initial product line and field of operation. With the implementation of its well decided strategies, virgin group of companies has earned customer trust, especially through the name itself and provision of quality services for its consumers. The firm is situated in various places in the world, having numerous branches in different areas. Due to the pure size of the Virgin Group their distribution channel is extremely expansive. This is a global company which has extended operations to meet customer requirements and create awareness on its products and value. The firm owns various related ventures in the world, through mergers and acquisitions which have been its sources of strength as compared to other businesses.

References

Jensen, C. (2000). Foundations of Strategy. New York: Harvard University press.

http://media.capella.edu/CourseMedia/MBA6024/assignmentIntro1/wrapper.asp

Watson, B. (2005). Business Models: Investing in Companies and Sectors with strong Competitive Advantage. Hampshire: Harriman house limited.