Richard Branson

This essay, in part, is set out to investigate how, and to what extent Richard Branson’s strategic methods relates to De Wit and Meyer’s (2004) description of generative reasoning perspective and rational reasoning perspective. An analysis-based comparison between generative reasoning perspective and rational reasoning perspective will present arguments on how the methodologies between the two types of strategic thinking perspectives fuels the debate over which approach to strategy may not only more effective, but also correlates to Branson’s own strategic thinking method.

Secondly, a discussion on whether Richard Branson is a characteristic “design thinker” as described by Liedtka will be put forth as well as an examination as to what extent Branson fits the characteristics of a “design thinker”.

Finally, a descriptive analysis of the three reasoning perspectives (generative / rational / design thinking) will show the underlying characteristics of each strategy and how with the use of significant theoretical models will help elaborate the relationship that each possess communicatively.

To understand the assumptions and characteristics involved with the generative reasoning perspective (GRP), one must first define it. In the GRP, emphasis is placed on the “wicked” nature of strategic problems (Rittel, 1972; Mason and Mitroff, 1981). It is argued that strategic problems cannot be easily and objectively defined, but that they are open to interpretation form a limitless variety of angles (De Wit and Meyer, 2004). This view on GRP brings up various distinctive traits which are associated with how one may categorize it.

With the use of Table 1 (Appendix 1), characteristics on GRP can be recognized. With this information, we can start to identify what extent Branson fits in with the GRP model. Arguably, GRP is seen as more of an abstract way of thinking whereby decisions are not based on any direct factual information. With this understanding, Branson clearly demonstrates a GRP regime of strategizing how he performs business. For instance, when Branson decision on how Virgin’s creative policy was to be implemented, in the music business, he based his decision largely on instinct as apposed to factual information. With that, Branson had to make a judgment call where little assurance was known on weather his choice would pull through for the benefit of the company.

Another distinctive trait that would define Branson as fitting the role of a GRP strategist is shown by how he places high value in innovativeness with his procedures. “From the rock market to the stock market” (Branson, 1998). With the emergence into the stock market in the mid-eighties, Branson’s objective was to raise capital to help reduce the company’s dependence on short-term bank borrowing, as well as to further expand without losing control of his company. This is a prime example of a GRP approach on problem solving as by reflecting on what would benefit the company with sense-making activities (De Wit et al, 2004) without completely understanding the effects that the stock market would have on the company.

Even though Branson’s hopes of allowing his company to reap the benefits of public trading, he soon discovered that, again, there were too many constraints unleashed on him in regards to how he could run his company. There were many stakeholders to account for and in July 1988 Branson bought back the publicly held shares. Arguably, this action by Branson re-enforces a GRP due to his believed importance on imagination within the company, and for doing activities which reflected him, and not the stakeholders. In relation to the use of creative imagination, Peter Drucker states in an article for the Harvard Business Review (2005) “Attaining one’s objective … is a cause for new thinking”, and with Branson’s decision to move away from the stock market, it is a result in his ability allowing for “new thinking” for the company. Furthermore, Branson is noted for his ability to change his strategic methods at the epistemic-cognitive level. This level is defined as the cognitive level where assumptions and values of a strategy form and take shape (Selner, 1986).

In 1999 Branson reassessed how all his business units should operate and changed his perspective on the overall corporate strategy. As shown in ‘The House that Branson Built’, a statement made from one of his senior executives as to “if Virgin companies ever decided to cooperate they would be unstoppable”, made Branson rethink his approach. Branson was inspired to lead the company down a new path by eliminating the promotion of autonomy for each business unit. Branson now believed that through synergy and working together, Virgin would be unstoppable.

These decisions arguably can be seen as careless