Blue, blue, my world is blue - Blue is my world now I'm without you -
Blue Ocesn POIM
-
Upload
brandy-hampton -
Category
Documents
-
view
228 -
download
0
Transcript of Blue Ocesn POIM
-
8/12/2019 Blue Ocesn POIM
1/20
By Priyanka Kale
Business Strategy
Blue Ocean StrategyMarch 2014
-
8/12/2019 Blue Ocesn POIM
2/20
Topics:
History and Background of Author and book
Traditional Logic
What is Blue Ocean?
Red Ocean vs. Blue Ocean
Value Innovation
Tools of BOS
1. EERC Grid
2. Canvas/Value CurveExample of BOS
-
8/12/2019 Blue Ocesn POIM
3/20
History and
Background
Blue Ocean Strategy is a businessstrategy book first published in 2005and written by W. Chan Kim
In this book the authors conveys thatan organization should create new
demand in an uncontested marketspace instead of competing in existingindustry which they call as BlueOcean.
The contents of the book are based onresearch and a series of HarvardBusiness Review articles as well as
academic articles on various extents ofthe subject.
Useful for CEOs, Executive, HOD andprime ministers.
-
8/12/2019 Blue Ocesn POIM
4/20
Traditional logic
Segmented; Competitive; defined boundaries;competition based on established rules, representsthe current scenario
-
8/12/2019 Blue Ocesn POIM
5/20
Blue Ocean
Blue Ocean Strategy is a powerful concept to work
on value proposition & explore new market
segments.
It is about pursuing - Value Innovation TheSimultaneous pursuit of differentiation and low cost
-
8/12/2019 Blue Ocesn POIM
6/20
Red Ocean Strategy Blue Ocean Strategy
Focus on rival within itsindustry
Looks across alternativeindustries
Beat the competitor. (Fightto win)
Make competition irrelevant(Win without fighting)
Growth is limited New opportunities of growth(unattractive market) with high
profit possibilitiesRisk involved defined and
known.Risk involved is high risk or there
is issue of risk
Decision between higherquality or lower costs Decision for higher customervalue and lower costs
Red versus Blue Ocean
-
8/12/2019 Blue Ocesn POIM
7/20
Creating Blue Oceans - Value Innovation
Firm needs to decideproduct/service which is innovativein parallel to utility, price and cost.
Value Innovation is achieved by
aligning three propositions.
1) Value proposition (utility minusprice)
2) Profit proposition (price minuscost)
3) People proposition
-
8/12/2019 Blue Ocesn POIM
8/20
BOS Tools or how to find new value curve
The Strategy Canvas
As per author, it is the central diagnostic and action framework for building a compellingblue ocean strategy.
The strategy canvas serves four purposes:
1) Identify the competitor and nature of business
2) Identify the factors of competitor and comparing your business with competitors3) Understand the possibilities of creating new value propositions and exploring new value
curves
4) Targeting new customers for sustaining in marketspace
The value curve is the basic component of the strategy canvas. A strong value curve has
focus, divergence as well as a compelling tagline
-
8/12/2019 Blue Ocesn POIM
9/20
-
8/12/2019 Blue Ocesn POIM
10/20
ERRC Grid
ERRC grid is consideredas the immediate planof action to achieve thebelow mentionedbenefits.
1) Utility
2) Price
3) Cost
4) Competitive factors
-
8/12/2019 Blue Ocesn POIM
11/20
Blue Ocean Strategy Description
Alternative industries Create altogether new industry Cricket-ent
Value Innovation 20-20 cricket is a fast pace game innovationwhich caters to total market segment ratherthan just cricket lover
Creating new demand Created new demand of watching cricketwith family
Complementary productand service offering
Provides complementary service ofentertainment along with cricket
Break value and cost tradeoff
Provides differentiation value at low cost
Example 1: IPLIndian Premiere League
-
8/12/2019 Blue Ocesn POIM
12/20
-
8/12/2019 Blue Ocesn POIM
13/20
NewValueCurve
CreateEntertainmentNewSegment Crick-ent
EliminateConventionalwisdom about
cricket
RaiseSpeed of the game
ExcitementFamily InvolvementPool of young talent
ReduceTime Spend
Money Spend
Uncertainty of Result
ERRC Grid of IPL - Indian Premiere League
-
8/12/2019 Blue Ocesn POIM
14/20
Blue Ocean Strategy Description
Alternative industries Timeshare basis
Value Innovation Inflation free and cheaper
Creating new demand Pre bought holidays for 25 years
Complementary product andservice offering
Standard accommodation at a goodprice
Break value and cost trade off Provides differentiation value at lowcost
Example 2: Mahindra Club Holidays
-
8/12/2019 Blue Ocesn POIM
15/20
ERRC Grid of Mahindra Club Holidays
ReduceAmount and TimeLuxury without compromising oncomfort
CreateCustomization of packages/low costpackagesMembership structure - in easy EMITie up with all the RCI resorts
EliminatedMiss selling of the productInconvenient way of registration
RaiseDiscounts of food and beverages andsightseeingFocused on promotional activitiesIncrease in no. of properties in India andAbroad with 15+ project in pipeline
NewValueCurve
-
8/12/2019 Blue Ocesn POIM
16/20
-
8/12/2019 Blue Ocesn POIM
17/20
Blue Ocean Strategy Description
Alternative industries The speed of plane at price of car
Value Innovation Offering the flexibility of bus travel at thespeed of air travel by using secondary airports
.
Creating new demand Short haul, low cost air travel
Complementary productand service offering
Simple fare structure
Example 3: Southwest Airlines
-
8/12/2019 Blue Ocesn POIM
18/20
Example 3: Southwest Airlines
-
8/12/2019 Blue Ocesn POIM
19/20
NewValueCurve
Create
able to price againstcar transportation
EliminateLounge/Food Facility
Seating of Classchoice
Raisefriendly service
Speedfrequent point-to-point departures
ReduceUncertainty of
scheduleHub Connectivity
ERRC Grid of Southwest Airlines
-
8/12/2019 Blue Ocesn POIM
20/20