Richard Branson's Leadership Style: Transformational Leadership Sir Richard Branson has proven to be a transformational leader in the airline industry. The edgy, unpredictable and youthful image of Virgin has garnered the company a kind of a 'cult following,' despite increasingly fickle consumer tastes. There have been a number of disasters, however, partially generated by Branson's shoot-from-the-hip style. Bucking conventional wisdom, Branson held onto underperforming Virgin stores and unsuccessfully tried to challenge Apple's iPod with a Virgin MP3 player. However, Branson's willingness to stay true to what he believes is right is what makes him so inspiring. He has crafted a unique image for his company, with a distinct ethos that has a clear system of values. This is exemplified in Branson's promote-from-within strategy and an emphasis on hiring people because of their personal qualities, rather than specific experiences. Branson's positive and forward-thinking attitude is reflected in the people he chooses to surround him.

Similar to Steve Jobs of Apple, Branson focuses on what he thinks customers need, rather than what market analysts tell him they say they want. But one of the aspects of Branson's leadership that is so distinct is his stress upon treating employees well. In fact, in the company hierarchy, employees come before customers. It is employees who provide the service that 'brands' Virgin as Virgin. Customers will stay loyal if employees are happy and productive. This will also translate into higher profits for the company.

Southwest, an American-based airplane company has a similarly quirky philosophy and also places a strong emphasis on hiring the right people. Branson's individualistic style of leadership seems well-suited to American companies, given America's emphasis on individualism as part of its national ethos. Also, all companies in all industries must fight to distinguish themselves from their competitors. They must have a cohesive sense of mission that all employees understand. Offering high-quality service is increasingly essential to generate a competitive advantage.
Recommend a different leadership style

Branson's leadership has proven to be effective at Virgin. It is the antithesis of the transactional style of leadership, which only seeks to motivate employees through a 'carrot and stick' approach, in which activities by employees are rewarded and punished in an external fashion. Branson is a risk-taker and enjoys soliciting opinions from employees rather than simply telling them what to do. He is known as 'Dr. Yes' because of his willingness to listen and to try new things. The downside to this is that some poorly-tested ideas may be implemented, diverting resources away from potentially more lucrative projects.

Branson could thus benefit from introducing a rewards-based system for employees who generate the most value-enhancing ideas for the Virgin brand and use more data-driven comparative metrics to track the progress of different projects. This would give…