Paul Kane/Getty Virgin Group cofounder and chairman Richard Branson. In the summer of 2012, the British government informed Virgin Trains that it had lost the bid to retain the operating rights to the UK's West Coast rail franchise. Virgin Trains had been running the 7-billion-pound ($10.9 billion) franchise for 15 years, expanding the line and growing its annual passenger numbers from 13 million to 30 million.
Richard Branson, chair of Virgin Train's parent company the Virgin Group, writes in his book "The Virgin Way: Everything I Know About Leadership" that he was "stunned and baffled" that he could have lost the bid to FirstGroup.
He decided to stay quiet for awhile, meeting with lawyers and advisors to see if Virgin had actually been beaten fairly. Everyone he spoke with seemed to conclude that FirstGroup's numbers were unsustainable, meaning the British government had made a mistake in calculations. Regardless, many of his senior team told Branson that he'd only be wasting his time and hurting his image with a lawsuit. But, after carefully weighing the facts, he decided to move forward with the lawsuit.
A week before he was scheduled to meet the Department for Transport in the UK's high court, Branson got a phone call from the department's secretary. The secretary told him that on further review, the department had indeed made grave miscalculations and Virgin had offered the better deal.
Branson considers his decision to sue the government, which ultimately saved his rail business, to be one of the best high-stakes decisions he's ever made. In his book he highlights four rules that he's used to make tough decisions throughout his business career:
Tony Woolliscroft/Getty Branson aboard one of his rail's trains. 1. Don't act on an emotional response.
Branson says he was flabbergasted when he first heard that the Virgin Trains deal had not gone through, but he was experienced enough to know that he should take some time to settle down and collect data instead of letting his feelings take control of him.
Had he made a statement to the press out of frustration or demanded to sue the British government solely out of instinct rather than fact, he would have increased the likelihood of having his case dismissed and appearing reckless.
It's just as bad to act on a positive emotion. Give decisions you're considering enough time to lose the influence of your first impressions.
2. Find as many downsides to an idea as possible.
Branson carefully considers everything that could go wrong before he goes forward with a decision.