Richard Branson and Virgin Group the Narcissistic Leader and Organization

Richard Branson and Virgin Group The Narcissistic Leader and Organization

Nabila Rozano, G.B.W. Willenborg Departemen Manajemen, Kelas Khusus International, Fakultas Ekonomi [email protected]

ABSTRAK Tujuan dibuatnya tesis atau skripsi ini adalah untuk mengidentifikasi karakter narsistik pada seorang pemimpin yaitu Richard Branson dan apakah karakter ini mempengaruhi Grup Virgin sehingga menjadi organisasi yang narsistik. Bab tinjau pustaka akan membahas karakter narsistik secara mendalam tidak hanya pada seorang pemimpin tapi juga terhadap organisasi. Diikuti dengan konsep teori lalu fakta dan penemuan dari berbagai sumber. Selanjutnya penelitian akan dilakukan dengan metode kualitatif dan kuantitatif sehingga mendapatkan informasi yang memadai. Dan tesis ini ditutup dengan dasar tinjauan pustaka. Secara singkat dapat disimpulkan bahwa Richard Branson adalah seorang pemimpin yang memiliki karakter narsistik tapi Grup Virgin tidak memiliki karakter tersebut.

ABSTRACT

The purpose of this thesis is to identify narcissistic leader’s characteristics on Richard Branson and whether he turns the Virgin Group to be a narcissistic organization as well. The literature about narcissism isdiscussed in depth about the leader and organizational context. Then followed by applying the theoretical concepts to the facts and finding from many sources. Furthermore, research will be done with qualitative and quantitative method in order to find sufficient information. And lastly, the conclusions will be based on the literature review. In brief, it is confirmed that Richard Branson is a narcissistic leader and Virgin Group is not a narcissistic organization.

1. INTRODUCTION AND CENTRAL RESEARCH QUESTION

Initial Motive It is known that the successof an organization may also depend on the leader apart from other. Leaders are those who provide directions, make decisions, and inspire others to achieve the company’s goals. In order to make decisions, their experiences, preferences, and personality become a strong influence factor. Maccoby (2000) for instance, mentioned that many business leaders have a narcissistic personality. According to Maccoby (2000) by having the narcissistic

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 personality, leaders will be more ambitious and capable to do their business.Furthermore, narcissistic CEOs favor bold actions that attract attention that results in either big wins or losses (Chatterjee &Hambrick,2007).

Problem Description and Analysis According to Macobby (2000), a person with narcissistic characteristics may turn out to be a great leader. It is interesting to learn about Richard Branson who started his first business since young age and became one of most successful CEOs.In short, Richard Branson is known as a founder and chairman of Virgin Group, which consist of more than 400 companies around the world. Aside from Virgin Group’s success, he also becomes popularly knownbecause ofhis appearance in several events and interviews. During these times he showed his charisma and were able to attract people’s attention toward what he did, which is one of the characteristics of a narcissist.

The aim of this thesis is to attestthese presumptions: Richard Branson is a narcissistic leader and the Virgin Group is a narcissistic organization. Furthermore, this thesis also will emphasize the impacts of Richard Branson’s narcissistic personality towards the Virgin Group itself. Consequently, acentral research question can be developed.

“ Is Richard Branson a narcissistic leader and isVirgin Group a narcissistic organization? “ Research Questions This central research question results in two sets of research questions. First, theory question that need to be answered using scientific literature and case questions about a particular organization that will be answered using all kinds of literature, scientific, journals, newspapers, etc.

A. Theory Questions 1. What is narcissism? 2. What are types of narcissism, characteristics, symptoms, etc? 3. What is a narcissistic leader? 4. What is a narcissistic organization?

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 5. How does a narcissistic leader influence the organization? 6. What are the short-term and long-term effects on this influence: on other parties, on strategy, performance, etc? 7. How can a narcissistic leader and narcissistic organization be identified, be diagnosed and measured? 8. How can the effects be measured?

B. Case Questions 9. Is Richard Branson a narcissistic leader? 10. Is Virgin Group a narcissistic organization? 11. What is the impactBranson’s personality on the Virgin organization?

The next section of this thesiswill be divided into two parts: the first part consists of literature review and hypotheses, and the second part consists of research plan, analysis and discussion and conclusion.

2. LITERATURE REVIEW

Narcissism Narcissism, derived from the Greek myth of Narcissus is a young man that falls in love with his own reflection. The term “narcissism” was invented for the first time by Havelock Ellis (1898) to describe a condition of perverse self-love. Narcissism is a relatively stable individual difference consisting of grandiosity, self-love and inflated self-views (Campbell, Campbell, Hoffman, Marchisio, 2011). Additionally, narcissism contains three components; those are the self, interpersonal relationships, and self-regulatory strategies. Nevertheless, narcissism found to be positively related with self-esteem, self-enhancement and the affective intensity (mood- swing) especially following criticism, and the use of singular personal pronouns in speech (Chatterjee &Hambrick, 2007).

Types of narcissism, characteristics and symptoms

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 A closer look at narcissism confirms for us the linkage between childhood and adult behavior (KetsDe Vries, 2004). Narcissism may arise as the influence of parental failings to provide affection, accepting, and secure context for development (Godkin&Allcorn, 2009).In addition, based on Psychiatric approach, narcissism is associated with personality disorder (NPD) that is characterized by grandiosity, a lack of empathy, and a desire for admiration.

In many literatures,authors make various distinctions between different types of narcissism (Campbell et al., 2011; Godkin&Allcorn, 2009; KetsDe Vries, 2004; Lubit, 2002; Maccoby, 2000; Stein, 2013). Campbell et al. (2011) for instance, mentioned there are two types of narcissism in which are clinical and subclinical narcissism.

First, clinical narcissism describes narcissism as narcissistic personality disorder (NPD) that refers to an enduring and inflexible character structure associated with grandiosity, a lack of empathy and a desire for admiration. Second, subclinical narcissism, which is the focus of this thesis,describes narcissism as a trait that is normally distributed in the population and for which there is no qualitative cut-off(taxon) for elevated narcissism. The two subsections of subclinical narcissism are healthy and destructive narcissism. The comparisons of the distinguishing characteristics of healthy and destructive narcissism, which are self-confidence; desire for power, wealth, and admiration; relationships; attitude toward authority; ability to follow a consistent path; foundation (Lubit, 2002), are described in details in the appendices.

Narcissistic Leader According to Maccoby (2000), narcissistic leader are people who have great visions and a chance to change the rules of the games. There are two types of narcissistic leader, healthy narcissistic leaderand destructive narcissistic leader (Lubit, 2002). First, healthy narcissistic leaders arecharacterized by empathy to master the interpersonal world, self-conscious emotions including shame and envy and a sense of control and power, high-level of confidence that most people equate with competence, have an infectious enthusiasms, charming, able to make fast decisions with seeming ease (Boyett, 2006; Godkin&Allcorn, 2009; Lubit, 2002).

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 As the contrary to healthy narcissistic leader, destructive narcissistic leaders are more likely to be linked with the pathological narcissism but with fewer characteristics compare to pathological narcissism (Brown, 1997). Pathological narcissism is described as inability to maintain self-cohesion and increased self-esteem dysregulation, which characterized by arrogant, shy, and psychopathic (Cain, Pincus& Ansell, 2008; Godkin&Allcorn, 2009). Several characteristics of destructive narcissistic leader are grandiosity (inflated sense of self-importance, arrogance, preoccupation with power and wealth, excessive seeking of admiration); a sense that they are entitled to have whatever they want, including willingness to exploit other to get it; and lack of concern for and devaluation of others (Godkin&Allcorn, 2009; Lubit, 2002).

Therefore, leader with healthy or destructive narcissistic personality enjoy being powerful, wealthy, and admiration but leaders with healthy narcissism are not obsessed with it (Lubit, 2002). Moreover, the narcissistic leaders will take all the credit for the positive results but bad results will be blamed on the employees since the narcissistic leader will find a reason why he or she is not responsible (Duchon&Drake, 2009) and even though narcissistic leaders consider themselves to be better than everyone else, they are not necessarily accompanied by better results (Rosenthal&Pittinsky, 2006).

Narcissistic Organization Narcissistic organization is one in which the organization is felt by its member to be very special and to be embody unique qualities (Stein, 2003). Narcissism in organization can also be developed as a reaction to the members’ narcissism. Stein (2003) argued organization narcissistic characterized by exaggerated pride, beliefs that they have unlimited power, complete knowledge of the environment with nothing lying beyond their ken, and being dismissive to other organizations.

Moreover, Godkin and Allcorn (2009) stated that healthy narcissism in organization might also improve the organization’s performance. Healthy narcissism characterizes organization that protect their identities by being self-confident, not self-aggrandizing, that earn success rather than believe themselves entitled to it and that use data to inform rather than deny and will not be insecure or feel threatened by the short-term failure and will be more open to the

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 change (Duchon, 2008). The negative effects of narcissism in organization, the organization may lose their sight of reality in marketplace and employs denial, self-importance, and sense of entitlement to prop up its damaged sense of identity (Campbell et al., 2011; Duchon, 2008).

Narcissistic leader influence on the organization A narcissistic leader plays a significant role in the organizations’ decision making. Researchers believe that it is most likely to impact the strategic actionsof the organizations’ performance. Furthermore, a narcissistic leader may influence their organization by his or her leadership styles, which are the power motivation and charismatic leadership or transformational leadership (Campbell et al., 2011; Rosenthal &Pittinsky, 2006).

First, power is needed by the leader in order to maintain strong position inside and outside the organization. Nevertheless, there might be overlap between the motivations and behaviors of narcissistic leaders and leaders with a strong power motivation (Rosenthal &Pittinsky, 2006). Leaders with a strong power motivation for instance, seek strength through influence rather than individual achievement as a means for nurturing the success of their subordinates and institutions.Thus, leaders with strong power motivation will attempt to influence others in order to obtain the organization’s goals.

Second, charismatic or transformational leadership becomes key factor in the popularity and ascendancy of such leaders and positive traits of narcissistic leaders (Campbell et al., 2011; Maccoby, 2000). As it is cited by Rosenthal &Pittinsky (2006), charismatic leadersare exceptionally gifted people who are most likely to emerge as leaders in times of crisis when they can devise radical solutions to the crisis, attract followers through the power of their charisma, and validate their followers’ belief in them through repeated success. Moreover, common people as well as their followers view charismatic leaders as an extraordinary and special individual. In other words, charismatic leadership style intersects between the leaders itself, the followers and the situation within the organization.

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 Subsequently, having discussed these two leadership styles, this thesis will examine which of the leadership styles does Richard Branson used to guide and influence the Virgin Group.

Short-term and long-term effects of narcissistic leader on organization Narcissistic leaders are expected to favoring strategic dynamism through new strategic plans or improve the existing plans, including buying or selling or even merger and acquisitions in order to larger their organization (Chatterjee &Hambrick, 2007; Maccoby, 2000). Furthermore, narcissistic leader engages in certain types of strategic actions such as bold, quantum, highly visible initiatives and tend to deliver extreme actions characterized by high-risk, high-reward and fluctuating performance that eventually lead to optimism and confidence about positive outcome for the organization (Chatterjee&Hambrick, 2007).

Narcissism is linked to outcomes for the self and the social environment that can be both positive and negative (Campbell et al., 2011). In the short term, organization has a greater performance than direct competitors. While in the long term, narcissism causes negative outcomes for the narcissist such as the loss of relationships, failure caused by inability to learn from mistakes, or the destruction of resources needed for long term success, even further it has damaging influence on organizational mentoring (Campbell et al., 2011).

Identification of narcissistic leader To identify whether the leader is a narcissist, DSM-IV by The American Psychiatric Association (2000) identifies nine characteristics and at least five of these should be present to classify a person as a narcissist. Those characteristics are (Rosenthal &Pittinsky, 2006): 1. Grandiose sense of self-importance 2. Preoccupied with fantasies of unlimited success, power, and brilliance 3. Belief in special or unique status (including fixation on associating with high-status people or institutions) 4. Requirement for excessive admiration 5. Unreasonable sense and expectations of entitlement 6. Interpersonal exploitative

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 7. Lack of empathy 8. Envy 9. Arrogant behaviours or attitudes

Identification of narcissistic organization To identify the narcissistic organization, Godkin and Allcorn (2009) specify a list of eleven characteristics of narcissistic organisations, based on the characteristics of narcissism in the DSM-IV-TR by the APA (2000). Furthermore, seven out of eleven criteria must be present. Those criteria are: 1. Exceptional pride is held for the organization, its accomplishments and great hope is held for future successes. Leaders see few limitations regarding what may be accomplished and are not inhibited as to how to accomplish goals. 2. Feelings of exceptional entitlement support exploitative of others, customers, and the public interest 3. When excessive pride is threatened and the pursuit of goals frustrated envy and rage arise. The leader or management group becomes hyperactive and willing to expend limitless time and energy to succeed and win out over rivals including aggression often tinged with sadism and revenge 4. There is a history of firings and demotions and of non-supporters and resistors being banished to internal organizational Siberias. Resistance is a threat and will not be tolerated 5. Management by intimidation is common 6. Fear suppresses accurate reality testing and creativity 7. Filtered information flows alter organizational reality and magical thinking is present. Operating problems it may be seemingly thought will pass without taking action to resolve them. It is too dangerous to confront management behavior that contributes to problem generation and perpetuation. 8. Others are frequently blamed and scapegoated 9. The sense of mood within the organization is unpredictable where one day a great success is celebrated and a week later there exists despair over not achieving the smallest of goals

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 10. Many in the organization are alienated from the organization and its leadership group preferring to hide out in their foxholes (offices and cubicles) 11. In and out group dynamics are polarized and there is considerable evidence of distressing and destructive internal competition and open warfare.

Measurement of the effect of narcissistic leader on the organization First of all, to measure individual narcissistic DSM-IV by The American Psychiatric Association (2000) can be used. Second, to measure the narcissistic organization eleven criteria proposed by Godkin and Allcorn (2009) can be used. Further, to measure the effect of narcissistic leader on the organization is through balance scorecard (Kaplan & Norton, 1992), which minimized the information overload by limiting the number of measurements used. Even more, Kaplan & Norton (2992) mentioned four important perspectives of measurements; those are financial perspective, internal business perspective, innovation and learning perspective, and customer perspective.

Richard Branson and Narcissistic Leader There are many examples of CEO or leaders that can be characterized as a narcissist. According to De Vries (1996), Richard Branson is one of CEOs who has a strong indication to a narcissistic personality. Richard Branson is known as the founder and chairman of Virgin Group. During his childhood, Branson was encouraged to speak as a child and his opinions were valued (Lafuante, 2012). This helped him to build self-esteem and confidence to communicate outside his social group. Due to his success, Branson cited as a role model for young people wanting a successful business carrier (De Vries, 1996). According to DSM-IV by the American Psychiatric Association (2000), at least five out of nine criteria must be present to describe whether he is a narcissist (Rosenthal &Pittinsky, 2006). Based on the criteria mentioned by the APA before, there are several criteria that present on him.

First of all, Richard Bransonhas a grandiose sense of self entitlement which is showed when he was in California showing off the spaceship that are now being built and tested andhe even realized that his vision sounds grandiose (Wolfe, 2013). Second, he is preoccupied with fantasies of unlimited success, whichhe believed that space travel would be succeeded and even

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 further he wants to build hotel in a space as continuity of space travel (Wolfe, 2013). Third, he believes that he has special or unique status; it can be proven by the fact that Queen Elizabeth II knighted him in 1999(Maag and Kasermann, 2010) and the United Nation also honored him in year 2007as citizen of the year (Levy, 2008). That status was given because of his business success, quest for adventure and unique personality (Maag and Kasermann, 2010).Fourth, he requires excessive admiration, it is proven by Branson did some unpredictable way to promote his business for instance when he drove a tank and fired a salvo to launch Virgin Cola in Times Square, New York (Lee, 2011). Fifth, he has unreasonable sense or just follows his gut feelings. Branson is also known as an expert in quick decision-making when it comes to the new ideas (Lafuante, 2012). It the paper made by Lafuante (2012), he said that when it comes to new idea, he feels the need to make it happen in the short period of time. Still in the relation with the decision-making, he does not really weight the risk and does not figure it in detail. Sixth, he has lack of empathy behavior which is proven when it comes to the decision-making he does not really put to much attention to what other thinks. For instance, when he came up with an idea of airline, directors of Virgin Music do not think that it might be a good idea since it needs a lot of consideration but Branson still established Virgin Atlantic. Lastly, arrogant behavior found in Branson, for instance when he stated that most companies mission statements are rubbish (Branson, 2013).

Virgin Group and Narcissistic Organization Virgin is one of the world’s most recognized and respected brands and has expanded into many diverse sectors from air and ground travel to telecommunications, health, space travel and renewable energy through more than 400 companies worldwide, employing approximately 50,000 people in 29 countries.(Virgin, 2013).Since the establishment of the Virgin Group, Branson tried to create a familiar atmosphere in which then generated a friendly, reliable culture or can be said an open culture (Grant, 2008). Next, Virgin’s culture found to be flat as it is without hierarchies, ready to change, sharing common values; short-line of communication among the employees and senior managers, and flexible response capability (De Vries, 1996). According to eleven criteria proposed by Godkin and Allcorn (2009), at least seven criteria must be present in the Virgin Group in order to state that Virgin Group is a narcissistic organization. However, the analyses discussed below have not found any supporting evidences of Virgin

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 Group being a narcissistic organization.

First, management by intimidation and blame and scapegoat of workers are not present in Virgin Group due to the first rules that related to Virgin’s culture is to have a good time and the leaders also have to praise the employees for their works (De Vries, 1996). Second, people are alienated and prefer to hide in their foxholes is also not supported due to the fact that Virgin Group found to be a company that maintains the family feelings within the firms, in which they have close relationship to each other and avoid alienation or even small group within the company (Kleiner, 2010). Third, there is no history of firings or demotion, it is because Richard Branson stated that if an employee does not excel at they work they should be given another chance with a different job within the company (Carmichael, 2008). Lastly, fear of reality testing and creativity is not present since Virgin Group expands their international business slowly so when it comes to the new market they already have mature strategy and assure that they are different (BK Strategic, 2010).

Impact of Richard Branson’s personality on Virgin Group Richard Branson’s personality goes hand in hand with Virgin’s strong reputation. Virgin’s values and purpose are consequences of Richard Branson’s values and vision. Branson believes that organization culture may become competitive advantage that differentiates Virgin Group with other companies, therefore Branson embracing a concept that “small is beautiful” (De Vries, 1996). Lafuante (2012) in her paper mentioned about Branson’s leadership style in which is frank, direct and sensible. Branson’s leadership styles are believed more likely to be transformational leadership. Moreover, still according to De Vries (1996) Virgin Group also use decentralization decision making while at the same time keep a close distance to the key performance indicators to stay informed about what is happening in the strategic units. Until now, Branson makes a great effort to avoid the bureaucracy in the Virgin Group (De Vries, 1996). As the example of strategic dynamism in the Virgin Group, formation of joint venture such as Virgin Atlantic with Delta that recently made, licensing like they did in Virgin Australia, and acquisition that appears on the Virgin Galactic case. Further, Virgin Group also engages in high-risk action as the impact of Richard Branson’s personality, for instance when they decided to create Virgin Galactic that offers space travel sinceit can be considered high-risk due to level

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 of safety (Dye, 2013).

Literature Review Conclusion It is mentioned earlier that literature will be divided into two parts, the theory part and the case part. In the theory part, it has been mentioned that this thesis focuses on subclinical narcissism with subsection of healthy and destructive narcissism. Narcissistic personality can be found in the leader in which has impact to the organization through his or her leadership style in which either power motivation or charismatic leadership. Further, narcissistic leader tend to favor strategic actions such as bold, quantum, highly visible initiatives and tend to deliver extreme actions. To identify a narcissist in a leader DSM-IV mentioned by the APA (2000) can be used and criteria mentioned by Godkin and Allcorn (2009) can be used to identify the narcissistic organization. And lastly to measure the effect of the narcissistic leader on organization balance scorecard proposed by Kaplan and Norton (1992) can be used.

Related to the theories, Richard Branson was found to be narcissist since more than five out of nine criteria by the APA (2000) are present in him, for instance grandiose sense of self- entitlement, preoccupied with fantasies of unlimited success, believes that he has special status, requirement for excessive admiration, lack of empathy, arrogant behavior. However, Virgin Group does not show any evidence of being a narcissistic organization since it is stated seven out of eleven criteria must be present while facts show there are at least five criteria that not present. Furthermore, Richard Branson has big role in influence the structure, culture and strategy of Virgin Group.

3. HYPOTHESES

Based on the literature review, there are two main hypotheses that can be derived to analyze whether Richard Branson is a narcissistic leader and Virgin Group is a narcissistic organization.

Main Hypothesis 1:

H1: Richard Branson isa narcissistic leader

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 H0: Richard Branson is not a narcissistic leader Etc for all hypos!!! Hypothesis 1.1:

H1: Richard Branson has grandiose sense of self-importance

H0: Richard Branson does not exhibit this characteristic Insert extra line after each hypoetc Hypothesis 1.2:

H1: Richard Branson is preoccupied with fantasies of unlimited success, power, and brilliance

H0: Richard Branson does not exhibit this characteristic Hypothesis 1.3:

H1: Richard Branson beliefs that he has special or unique status (including fixation on associating with high-status people or institutions)

H0:Richard Branson does not exhibit this characteristic Hypothesis 1.4:

H1: Richard Branson requires excessive admiration

H0:Richard Branson does not exhibit this characteristic Hypothesis 1.5:

H1: Richard Branson’s behavioris characterized by unreasonable sense and expectations of entitlement

H0:Richard Branson does not exhibit this characteristic Hypothesis 1.6:

H1:Richard Branson’sbehavior is characterized by interpersonal exploitativeness

H0:Richard Branson does not exhibit this characteristic Hypothesis 1.7:

H1: Richard Branson’s behavior characterized by lack of empathy

H0: Richard Branson does not exhibit this characteristic Hypothesis 1.8:

H1: Richard Branson’s behavior is characterized by envious

H0: Richard Branson does not exhibit this characteristic Hypothesis 1.9:

H1: Richard Branson’s behavior is characterized by arrogant behavior or attitudes

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 H0:Richard Branson does not exhibit this characteristic

Main Hypothesis 2:

H1: Virgin Group is an arrogant narcissistic organization

H0: Virgin Group is not an arrogant narcissistic organization

Hypothesis 2.1:

H1:: Virgin Group as organization is characterized by exceptional pride

H0: Virgin Group as organization is not characterized by exceptional pride Hypothesis 2.2:

H1: Virgin Group as organization is characterized by feelings of exceptional entitlement

H0: Virgin Group does not exhibit this characteristic Hypothesis 2.3:

H1: Virgin Group as organization is characterized by envy and rage that arise when excessive pride is threatened

H0:Virgin Group does not exhibit this characteristic Hypothesis 2.4:

H1: Virgin Group as organization is characterized by firings and demotions of non-supporters and resistors

H0: Virgin Group does not exhibit this characteristic Hypothesis 2.5:

H1:Virgin Group as organization is characterized by management by intimidation

H0: Virgin Group does not exhibit this characteristic Hypothesis 2.6:

H1: Virgin Group as organization is characterized by fear that suppresses accurate reality testing and creativity

H0: Virgin Group does not exhibit this characteristic Hypothesis 2.7:

H1: Virgin Group as organization is characterized by filtered information that flows alter organizational reality and magical thinking is present

H0: Virgin Group does not exhibit this characteristic

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 Hypothesis 2.8:

H1: Virgin Group as organization is characterized by frequently blamed and scapegoated others

H0: Virgin Group does not exhibit this characteristic Hypothesis 2.9:

H1:: Virgin Group as organization is characterized by unpredictable sense of mood

H0:Virgin Group does not exhibit this characteristic Hypothesis 2.10:

H1: Virgin Group as organization is characterized by many alienations and its leadership group prefer to hide out in their foxholes

H0: Virgin Group does not exhibit this characteristic Hypothesis 2.11:

H1: Virgin Group as organization is characterized by in and out-group dynamics that are polarized and there is evidence of distressing and destructive internal competition and open warfare

H0: Virgin Group does not exhibit this characteristic

4. RESEARCH PLAN

Research Method Research plan will be designed to test the hypotheses from the previous part of this thesis. In order to collect the data that will be needed, there will be two approaches used: qualitative and quantitative method.Qualitative approach will use structured interview given to Board of Directors and managing personnel who are closely acquainted with Richard Branson. Qualitative approach has several advantages such as detailed information about personal feelings, perceptions and opinions; high response rate; and comprehensivedocumentation and archive. Furthermore, to support the qualitative approach, quantitative approach will be used. Quantitative approach will use survey through questionnaires that will be used to support the information from qualitative approach. Quantitative approach has several advantages, for example, information can be collected from a large number of people, cheaper, shorter time

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 consumed, and easier to analyze. The stages of quantitative approach first begin with the sample, and continue with data collection, data analysis, and data preparation.

Sample The unit of analysis of this study is the employees of the Virgin Group. The sample of the interview will be smaller compare to the questionnaire. The interviewees must be in the top management or board of directors in one of the Virgin Group’s company in order to gather wide- ranging information about Richard Branson and his influences to the Virgin Group. For the questionnaire, it will be distributed to Virgin Atlantic, Virgin Trains and Virgin Unite with the numbers of sample size around 50 people from each subsidiary in order to get adequate sample. These subsidiaries are chosen because of the number of stakes owned by Virgin Group is more than 50%. Sample is selected based on the position of the employees and working period within the company. The position of the employees should represent from lower to top management and have at least been working for at least five years.

Data Collection

As it is mentioned earlier, survey will be conducted through primary data. In order to gain the information needed to measure and test the hypotheses, there will be two main ways. First is through individual interview for selected people and second, specific questionnaires will be developed and distributed to the sample of the population.

Interviews First, face-to-face interview will be conducted and the interviewee will be chosen based on the level of position and the length of working period within the Virgin Group. Each interviewee will be asked the exact same questions to minimize the risk of bias. For instance, there will be around five to ten people from different position such as managers and board of directors of Virgin Group who will be asked about a specific leadership characteristic of Richard Bransonand his influence to the Virgin Group. For instance, possibilities of the people that could be chosen at random from the population of top managements and board of directors are Gordon

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 McCallum, senior partner of Virgin Group that involves in managing Group’s investment in the telecom, media, financial services and contribute heavily on group’s strategic development; and Patrick McCall, senior partner and hold a board position in Virgin Active, Virgin Galactic, Virgin Care, Virgin Trains and Virgin Unite.

Questionnaires The questionnaires will be distributed to several subsidiaries of Virgin Group. Questions provided in the questionnaire will use Likert scale from one to five, with scale one refers to strongly disagree and scale five refers to strongly agree to the questions or statements. The topics on the questionnaires are about Richard Branson’s personality, leadership or management style, working environment in the company and the company’s performance.

Data Analysis The measurement of collected data of individual narcissistic are based on nine characteristics in DSM-IV by the American Psychiatric Association (2000); and eleven criteria proposed by Godkin and Allcorn (2009) are used to measure the narcissistic organization. Further, to analyze the data collected from the questionnaires and to test the hypotheses, statistical program SPSS will be used. SPSS program analyzes both descriptive and inferential statistics to have accurate results. The program performs data preparation, descriptive statistics, correlation, inferential statistics and validation.

Data Preparation The data will be analyzed by using SPSS, the data collected will be made into a database in the SPSS program to keep it stored.There are two variables that will be examined through this program. First, the independent variable is narcissistic leader. Second, the dependent variable will be narcissistic organization because there is possibility of it affected by the independent variable. Based on two variables, the effect of narcissistic leader on the organization can be performed.

Descriptive Statistics

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 Descriptive analysis is used to describe what the data shows for instance the distribution, mean, median, mode and standard deviation. These statistics give a better outlook at the distribution of each of the variables and can also be used to spot outliers.

Validity Validity refers to the degree to which inferences can legitimately be made from the operationalization in the study to the theoretical constructs on which that operationalization was based (Trochim, 2006). In order to construct validity, there are two major ways. First, translation validity focuses on whether the operationalization is a good reflection of the construct. Translation validity includes face validity and content validity. Secondly, criterion-related validity examines whether the operationalization behaves the way it should given your theory of the construct. Criterion-related validity includes predictive validity, concurrent validity, convergent validity, and discriminant validity.

Correlation To check the correlation between the variables, the correlation analysis can be used. And to check the reliability between the variables, Cronbach’s alpha can be used and the number appears should be above 0.6.

Inferential Statistics. This part is to test the independent variable and dependent variable in order to draw the conclusion. Since there are two variables – independent and dependent variable, bivariate analysis will be implemented. Further, t-test, Analysis of Variance (ANOVA) or regression analysis can be used.

5. ANALYSIS AND DISCUSSION

For this thesis, it was not necessary to execute the research plan. Thus, there are no data to analyze or results discuss.

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014

6. CONCLUSIONS AND RECOMMENDATION

Conclusions The conclusion will be based on the literature review in the previous part. To begin the conclusion, it will be better to look at the central research question in which is “Is Richard Branson a narcissistic leader and is Virgin Group a narcissistic organization?” From the findings, it is confirmed that Richard Branson is a narcissistic leader since six out of nine criteria are present in him. However, even though he is a narcissist, he does not turn the Virgin Group into a narcissistic organization since Virgin Group does not fulfill at least sevenout of eleven criteria about narcissistic organization. Until now, heinfluences Virgin Group since the company first established. Those influences are strong reputation with Virgin as a brand name, his transformational leadership style that is able to attract people by his charisma, company’s structure that follows his principal “small is beautiful”, and further influence on the company’s strategy in doing the business.

Recommendations In order to maintain the company’s performance as it is now there are several recommendations that can be considered. First, knowing the fact that Richard Branson is a narcissist, it will be better for him to be more aware about his personality so it will not damage his own image and possibility ofdamaging the reputation of the Virgin Group. Second, Virgin Group’s structure is found to be flat without hierarchies in which makes them have a close relationship between one to another and it is better to maintain this structure and the open culture. Third, Virgin Group should seek a more objectiveand broad values and visions other than that of Richard Branson’s.

Reflection This thesis has several weaknesses such as limited time and cost, thus the research plan cannot be executed and the hypotheses are not empirically tested. This thesis tends to be subjective, and its validity cannot be established. Nevertheless, this thesis provides

Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014 comprehensive information about narcissism theoretical ideas, and a case study about Richard Branson and Virgin Group that can be useful for further research.

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Richard branson dan grup virgin..., Nabila Rozano, FE UI, 2014