Phew! Having just told Britain’s favourite billionaire ‘you’re not going to be around forever, are you?’ (my carefully-rehearsed euphemisms went completely out of the window), I find he has taken my remark much better than expected. "Virgin’s people culture is now self-fulfilling," he explains. "It will go on way beyond me."
Branson is likely to face the ‘what happens next?’ question a lot more often in the future. Later this month, the flamboyant entrepreneur – the man with 370 different companies to his name – will turn 60. While being sexagenarian is hardly old nowadays (he’s younger than Lord (Alan) Sugar, Sir Stuart Rose, Sir James Dyson, and only a smidgeon older than retail magnate Sir Philip Green), creeping closer to pensionable age will focus attention on one, seemingly immutable, fact: Virgin and Branson have all the traits of being indivisible. Few companies have so publicly revolved around one man; Virgin is Branson and Branson is Virgin. It’s through the cult of Branson that Virgin has grown to what it is today – a £10 billion revenue per year business empire, employing more than 50,000 people worldwide. Today being ‘Branson-esque’ has become shorthand for a certain style of leadership – the personification of a brand. But is this style of leadership old hat, even negative for the future success of a company? Is being Branson-esque what Branson himself wants for the future and is being a Virgin employee really about breathing Branson’s own values? If so, can it really "go on way beyond" the man in charge? I’m wary again – that’s a lot of questions to throw at anyone, never mind Branson.
"I’m happy to say I’ve never read a book on HR theory or people management," he admits as he ponders them. "Our guiding principle is this: give individuals the tools they need, outline some parameters to work within, and then just let them get on and do their stuff."
As the ingredients for business success (and, he says, "for the success of HR as a discipline" because "ideas come from your people if you let them"), it is wonderfully simple. But Branson does reveal his more serious, considered side too. "For as much as you need a strong personality to build a business from scratch, you must also understand the art of delegation. I have to be willing to step back now," he admits. "I have to be good at helping people run the individual businesses – it can’t just be me that sets the culture when we recruit people." He makes no apology: "The company must be set up so it can run without me," he says starkly.
Although the world is not going to see Branson disappear any time soon, with comments like these you do suspect Branson is thinking about what the future holds. "I don’t want people to think like me in totality," he says. "Our brand values are very important, and we tend to select people to work for us who share those same principles," he adds when asked if he thinks he has built a company full of ‘mini-mes’. But Branson says he wants to see more difference, more diversity of ideas. "I expect people to be giving me reasons and ways to progress an idea into either a ‘yes’ or a ‘no’," he remarks, and there is an admission, of sorts, that he thinks people are maybe too deferential to him.
"In 2004 I did a programme called The Rebel Billionaire for Fox Television [a pre-cursor of Donald Trump’s The Apprentice]," he recalls. "In one episode I told a participant, Sam Heshmati, he and I could be the first to go over Victoria Falls in a barrel. While Niagara Falls was first conquered in 1901, the Victoria Falls, at 360 feet, is more than twice as high, with jagged rocks at the bottom. I told Sam that the barrel had been specially designed by NASA; we got into it, and a crane started lowering us toward the water. A split second before the we were due to be released, I shouted ‘Stop!’ We got out, and I showed Sam the bottom of the falls, pointing to the rocks below. I admonished him: ‘You were 10 seconds from certain death. You shouldn’t blindly accept a leader’s advice; you’ve got to question and challenge leaders on occasions."
If employees are prepared to die following Branson, rather than question him, it’s no wonder he wants to cultivate debate within the company. This is where he feels his HR leadership and the rest of his people management team has the chance to do this, and without destroying the long-term view of what it is to be Virgin.
"The key to effective people management is ensuring everyone has a little of people management in them. It isn’t solely Angela’s [Virgin’s head of group people management] job to make our people’s policies work at Virgin. It’s everyone’s responsibility. We have a group people team, who are in essence the custodians of the Virgin people brand, ensuring there is consistency throughout the group in key values, behaviours and policies. But each business has its own shareholders and management – this way we concentrate on the job at hand rather than be part of some enormous, faceless conglomerate. The process and approach systems come from the people management principles, but the brands have a certain amount of freedom to do what they want to do."
Underlying ‘Virgin-ness’ but with scope for individuality is what Branson believes is the better way to think of his style of leadership. Scholars might theorise about what being ‘Branson-esque’ is, but the man himself doesn’t see it: "I haven’t academicalised my own way of working," he says resolutely. "I am myself. I wanted to get records easily; we created a records business. I travelled on planes; I wanted them to be better; we created Virgin in the air. All the leaders in the Virgin businesses have the same mentality and approach to our culture, and this stems from having really clear, simple brand values. But we can’t take things for granted that the culture will remain as it is."
According to Branson, the collective needs to be more important than him. "Our view at Virgin is that collective responsibility bonds teams, and having pride in your work is a far better driver than a hierarchical culture where the boss calls the shots."
The kind of things Branson mentions as fostering this include making group CEO Stephen Murphy more prominent. "We hold a series of lunches where a small group of employees meet him, get updates from him directly and have the opportunity to ask him any questions they like." He adds: "Many of our businesses run innovation schemes where employees can submit new business ideas to be considered by the strategic leaders. We also facilitate peer-to-peer nominations to recognise top performers around the four Virgin values of innovation, customer service, community and environment. One lucky person even gets to spend a week on [my] Necker Island."
For someone who confesses not to have read HR theory – "I hate the descriptor, human resources, by the way," he says, "I call them people departments" – these are very HR-like notions. And Branson has a clear ideas about preferring people in his business to make mistakes, rather than to play safe and not take risks at all: "One thing is certain in business; you and everyone around you will make mistakes. When you are pushing the boundaries this is inevitable – but it’s important to recognise this," he argues. "We need to look for new ways to shape up to the competition. So we trust people to learn from mistakes; blame and recriminations are pointless," he reveals. "A person who makes no mistakes, makes nothing. If I can help it, I never let good people go. I feel people should be given more than one chance within the Virgin Group."
But by hiring for the traits that will already make ordinary people culturally ‘Virgin people’ (rather than having them inculcated by the Virgin brand) Branson believes the Virgin way will outlive him. He observes: "You will find the ‘Virgin type’ of person all over the world. I bump into them frequently in bars, cafes, hotels and small businesses, in libraries, post offices, at the jetty in the Caribbean. They pop up all over the world. They don’t know they’re special but they are. They are out there, and you can spot them. If you’re in a company, and in charge of a human resources department, you should be searching for them too."
The billionaire is well-known for his belief that it’s not qualifications that matter, but attitude, and today is no different. "These people," he continues "by their nature and outlook on life, enjoy working with people. They’re attentive. They smile freely. I don’t underestimate qualifications, but I just don’t assume they are going to tell me anything about a person’s character. Having savvy is much more important than having a formal education. The things you learn only complement who you are. In my book, who you are counts for a whole lot."
Assuming all these principles are adhered to, you sense the Virgin brand is well on its way to developing and maintaining an identity stronger than Branson’s own. He says this is leaving him freer to devote the next chunk of his life to social entrepreneurship, something he feels is a leadership challenge all businesses need to tackle, and one they should get their staff engaged in.
"The next big leadership issue for me is the bigger social problems we face," he says. "I think every business needs a leader that does not forget the massive impact business can have on the world. All business leaders should be thinking ‘how can I be a force for good?’"
In 2006, Branson pledged he would put all profits from his Virgin rail and air interests – representing £1.6 billion over 10 years – to tackle climate change. The vehicle for his next vision though is his non-profit foundation, Virgin Unite. Tasked with incubating new global leadership models (such as supporting the ‘Carbon War Room’ project to built a low-carbon economy) and working with businesses to drive social change, it was named by staff and aims to involve as many of them as possible to mix genuine good with building a true sense of employee engagement.
"Virgin Unite is about leveraging all the resources of the Virgin Group," he explains. "It’s the ‘glue’ to help to use the might of the group in a positive way. The three main ways staff get involved are through ‘hit squads’, ‘staff connection trips’ and ‘fix it’ squads." Hit squads have helped managers at partner children’s charity Rathbone do what Virgin staff know how to do best – raising their profile. For connection trips, staff who may not normally see each other, have a chance to work together on projects that help troubled communities. Some have taken part in ‘Pride ‘n Purpose’, the charitable arm of Branson’s game reserve, at Ulusaba, where schools have been built and water and health services have been set up. Fix-it squads are more UK-focused. A recent squad from Virgin Active revamped a gym at children’s charity Kids Company in south London.
Unite’s mobilisations are diverse, everything from staff cake bake-offs (to raise money for the London Marathon which Virgin began sponsoring this year), to petitioning US Congress to establish a national homeless Youth Awareness Month in November. Branson says he understands critics who say CSR is actually PR, but he maintains the passion to make change is actually driven by staff themselves and that he, as a business leader, is listening to this. "What I see is demand from our people to be a business that is good, makes a profit, but also does something for the planet and humanity. I think this is a trend we will see more of."
But maybe his most controversial (or sensible) view is this: he believes CSR as we currently view it is actually dead anyway. "CSR in my mind is defunct now," he says categorically. "Compartmentalising the socially responsible is not the way to go. I think the model for starting employee engagement activities has to be embedded in everything you do. My next challenge through Unite is to work with businesses outside of the Virgin Group, to look at how they can be a force for good."
As he enters his seventh decade, his fifth as one of Britain’s best-loved and, crucially, most successful businessmen, you wouldn’t expect Branson to set himself a challenge on a scale that is anything less. But, he’s ballooned across oceans, is about to go into space, (with Virgin Galactic), and oh, his latest venture will also be exploring the deep blue sea – Virgin Oceanics. You kind of think he’s going to achieve whatever he sets out to do.
Branson on:
The Virgin culture… "I started Virgin with a philosophy that if staff are happy, customers will follow. It can’t just be me that sets the culture when we recruit people. I have a really great set of CEOs across our businesses who live and breathe the Virgin brand and who are entrepreneurs themselves."
The role of HR… "From humble beginnings HR was really a one-man band dealing with compliance and procedural aspects. We now have more than 400 people specialists who are responsible for delivering best practice advice to the rest of the group.
Employees as stakeholders…. "If people are properly and regularly recognised for their initiative, then the business has to flourish. Why? Because it’s their business, an extension of their personality. Everyone feels Virgin is theirs to keep and look after. And it runs deeper. I am a firm believer in listening to your staff at all times. The moment you stop doing this, you are in danger of losing your best people."
Working at Virgin… "I really believe people should not be pigeon-holed. Many people say to me they have their day jobs – usually the one on their cards or contracts – but people also have night and weekend jobs."
