G Conderacci Blue Ocean Gbtc
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G Conderacci Blue Ocean Gbtc

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Blue Ocean Strategy Session presented by Greg Conderacci and the GBTC

Blue Ocean Strategy Session presented by Greg Conderacci and the GBTC

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  • Everyone knows the story of David and Goliath, but it’s worthwhile to take a minute to actually look at the exact words of the story -- especially these three short paragraphs that describe David’s preparation. That’s because, as we all know, often the game is won as much in the preparation as in the playing. And preparing is what we’re doing today.
  • When Lawrence of arabia led the revote against the ottoman army occupying arabia toward the end of the WWI, he knew his bedoins couldn’t beat the turks at medina where they were fortified. So he hit their rail lines. “Our cards were speed and time. Our largest available resources were the tribesmen, men quite unused to formal warfare, who assets were movement, endurance, individual intelligence, knowledge of the country, courage. Attached Aqaba from the desert, defeated 1200 turks, lost only two men.

G Conderacci Blue Ocean Gbtc G Conderacci Blue Ocean Gbtc Presentation Transcript

  • Objective: Discovery!
    • Discover the Blue Ocean Strategy* and how it can help you explore profitable, innovative ideas
    • Learn some Blue Ocean tools, tips and tricks that might stand you in good stead in tough times
    • Have fun!
    * Based on Blue Ocean Strategy, W. Chan Kim and Renee Mauborgne Harvard Business School Press (2 million copies sold in 41 languages)
  • How Bad Can It Get?
  • “ Turn SCE to Aux”
  • What’s “Blue”? Sailing Boldly Into The Unknown
  • Innovate in the Face of Challenges
  • Blue vs Red Oceans
    • Red: known market space – demand is fought over
    • Blue: unknown today – demand is created
    • From something old: Cirque
    • From something new: eBay
    • For example: mutual funds, cell phones, express package delivery, home videos, biotechnology, discount retailing
  • Blue Ocean Businesses
  • Nothing New
    • Pricing: 1908 -- $850; 1909 -- $609;
    • 1924 -- $290 (vs carriages $400)
    • Market share: 1908 – 9%; 1921 – 61%
    • Production time: 4 days (vs industry 21)
  • Not Just Products
  • David Faces Goliath
      • Then Saul clothed David in his own tunic, putting a bronze helmet on his head and arming him with a coat of mail.
      • David also girded himself with Saul's sword over the tunic. He walked with difficulty, however, since he had never tried armor before. He said to Saul, "I cannot go in these, because I have never tried them before." So he took them off.
      • Then, staff in hand, David selected five smooth stones from the wadi and put them in the pocket of his shepherd's bag. With his sling also ready to hand, he approached the Philistine.
      • --1 Samuel 17:38-40
  • How “Davids” Win
    • In battle, “Goliaths” (10x stronger) win 71.5% of the time – when the fighting is “conventional”
    • When underdogs choose unconventional strategies they win 63.6% of the time – “ even when everything we think we know about power says they shouldn’t”
    • – Ivan Arreguin-Toft, political scientist
    Source: “How David Beats Goliath” by Malcolm Gladwell, The New Yorker 5/11/09; study of wars fought over the last 200 years between strong and weak combatants. T. E. Lawrence
  • Why You Want to Be Blue
    • Kim and Mauborgne: 108 business launches:
    • 86% of new ventures line extensions = 39% of total profits
    • 14% new industries/markets= 61% of profits
    • The trap of “military,” competition-focused strategy
    • It’s the Strategic Move that Matters
  • Blue vs Red
    • RED
    • Compete in existing space
    • Beat the competition
    • Exploit existing demand
    • Make value/cost trade-off
    • Differentiation vs low cost
    • BLUE
    • Create uncontested space
    • Make competition irrelevant
    • Create new demand
    • Break value/cost trade-off
    • Differentiation AND low cost
  • Cornerstone: Value Innovation Costs Buyer Value Value Innovation
  • Exercise: Finding Blue Around You
  • “ Blue Holes”: Are You Ready for Blue? Reduce Eliminate Create Raise New Value Curve
  • Into The Wild Blue: The Strategy Canvas Factors of Competition
  • Three Characteristics of Good Strategy
    • Focus – Concentrate your investment on a few key factors (e.g., Southwest: friendly service, speed, point to point departures)
    • Divergence – Differentiate from your industry’s average profile (e.g., Southwest vs other airlines)
    • Compelling tagline – A clear, simple, truthful message (e.g. – “Cheaper than driving”)
  • The Idea Box: A New Car Wash Source: Thinkertoys by Michael Michalko Method Washed Equipment Products 1 Full Cars Sprays Related 2 Self Trucks Conveyors Novelties 3 Hand Houses Stalls Books 4 Mobile Clothes Dryers Food 5 Combination Dogs Brushes Cigarettes 6 Other Cats Brooms Toys
  • Test: How Do You Know You’re Blue? Buyer Utility Price Cost Adoption Blue Ocean Idea
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
    • How long does it take to find the product?
    • Is the purchase place attractive and accessible?
    • How secure is the transaction environment?
    • How rapidly can the purchase be made?
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
    • How long does it take to get the product?
    • How easy to unpack and install?
    • Do buyers have to arrange delivery themselves?
    • How costly and difficult is this?
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
    • Does the product require training or assistance?
    • Is it easy to store when not in use?
    • How effective are the features and functions?
    • Does it deliver more power or options than needed?
    • Is it overcharged with bells and whistles?
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
    • Does it need other products to make it work?
    • How costly are they?
    • How much time do they take?
    • How much pain do they cause?
    • How easy are they to obtain?
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
    • Does the product require external maintenance?
    • How easy is it to maintain and upgrade?
    • How costly is the maintenance?
  • The Buyer Experience Cycle Purchase Delivery Use Supplements Disposal Maintenance
    • Does the use of the product create waste?
    • How easy is it to dispose of product/waste?
    • Are their legal or environmental issues?
    • How costly is disposal?
  • What Stands in the Way of True Blue?: Hurdles to Strategy Execution Cognitive Wedded to the status quo Limited Resources Political Opposition from vested interests Unmotivated Staff
  • Fair Process Impacts Behavior Fair Process Engagement Explanation Expectation Exceeds Expectations Self-initiated Trust/Commitment “ My opinion counts” Voluntary Cooperation “ I’ll go beyond the call of duty” Attitudes Strategy Formulation Process Behavior Strategy Execution
  • Tipping Point Leadership Mass of Employees Extremes Extremes
  • Thank you! Greg Conderacci Good Ground Consulting LLC [email_address] 443-756-8213 [email_address]