Lezione di strategia aziendale

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Lezione di strategia aziendale

  1. 1. University of Cagliari, Faculty of Economics, a.a. 2012-13 Business Strategy and Policy A course within the II level degree in Managerial Economics year II, semester I, 6 credits Lecturer: Dr Alberto Asquer aasquer@unica.it Phone: 070 6753399
  2. 2. Business Strategy and Policy Lecture 5Strategic entrepreneurshipand the Blue Ocean Strategy
  3. 3. Introduction 1. Strategic entrepreneurship 2. Blue Ocean Strategy 3. An example of Blue Ocean Strategy: [yellow tail] 4. The Strategy Canvass and the Four-Actions Framework 5. Other instances of Blue Ocean Strategy ------------- 6. Summary
  4. 4. 1. Strategic entrepreneurshipThe process of seeking opportunities and sources of (sustainable) competitive advantage that lead to superior firm performanceEntrepreneurship: the undertaking of innovation in combination with financial and business skills with the aim of accomplishing economic gains Commonly: the start-up of new business ventures Sometimes: the undertaking of corporate ventures (e.g., spin-offs)Strategic entrepreneurship: managing the firm in such a way as to undertake new business ventures that lead to superior performance in the long term It requires creativity, imagination, and opportunities; dealing with risk; stimulating and supporting innovation; managing change; mastering technology; and (sometimes) designing new business models
  5. 5. 1. Strategic entrepreneurshipFirms may undertake offensive strategies, that are explicitly intended to undercut competitors within the same industry and marketsOffensive strategies generally aim to result in higher market share, higher profit margins, and higher growth rate than competitorsThey consist of... Offering comparable products/services at lower price than competitors Introducing next-generation technology products faster than competitors Imitating ideas and tactics of competitors Focusing attacks to the most lucrative segments of competitors and to the weakest competences of competitor
  6. 6. 1. Strategic entrepreneurshipIn contrast, avoidance strategies relate to steering clear from face-to- face confrontation with competitors (especially, when they are stronger!)Avoidance strategies entail finding ways to enter the market and gain market share in a way that does not (necessarily) harm competitors, therefore making competitors retaliation more unlikely to happenStrategic entrepreneurship may be conceived as a type of avoidance strategy, insofar as it relates to “inventiveness” to define new approaches to the market that do not necessitate direct confrontation with other firms
  7. 7. 2. Blue Ocean Strategy (Kim and Mauborgne, 2005)
  8. 8. 2. Blue Ocean Strategy The Fundamentals of a successful strategy: Value Innovation Costs Value innovation Value
  9. 9. 2. Blue Ocean Strategy Within any given industry, every firm seeks to raise value & cut costs in order to enhance value innovation and outperform the competitors The effect is more competition, i.e., minor profit margins for everyone
  10. 10. 2. Blue Ocean Strategy Within any given industry, every firm seeks to raise value & cut costs in order to enhance value innovation and outperform the competitors The effect is more competition, i.e., minor profit margins for everyone A Red Ocean
  11. 11. 2. Blue Ocean Strategy A successful strategy consists of “pulling ourself out” of the tough competition by venturing into unchartered “water” where no other competitors are present (yet) A Blue Ocean
  12. 12. 2. Blue Ocean Strategy A comparison between red and blue oceans: Red Oceans Blue Oceans Compete in existing markets Create uncontested market space Beat the competition Make the competition irrelevant Exploit existing demand Create and capture new demand Make the value-cost trade off Break the value-cost trade off Align the firm value chain to Align the firm value chain to the overall strategy (low cost seeking both differentiation and or differentiation or focus) low cost
  13. 13. 3. An example of Blue Ocean Strategy: [yellow tail]
  14. 14. 3. An example of Blue Ocean Strategy: [yellow tail] The setting: the US wine industry, in 2000... The third largest aggregate consumption of wine worldwide Highly competitive industry Large share of California-based producers Several imported wines from France, Italy, Spain, Chile, Australia and Argentina Consolidation (8 companies produce more than 75% wine) Stagnant demand Battle for shelf space Rising marketing & advertising costs
  15. 15. 3. An example of Blue Ocean Strategy: [yellow tail] The setting: the US wine industry, in 2000... The third largest aggregate consumption of wine worldwide Highly competitive industry Large share of California-based producers ma rket tive tt r a c an a Several imported wines from France, Italy, Spain, Chile, Australia and Argentina , not arge nd l Consolidationy a companies produce more than 75% wine) B (8 Stagnant demand Battle for shelf space Rising marketing & advertising costs
  16. 16. 3. An example of Blue Ocean Strategy: [yellow tail] But...
  17. 17. 3. An example of Blue Ocean Strategy: [yellow tail] But... 2000, Casella Wines introduced [yellow tail] in the US 2001, about 112,000 cases were sold 2002, it became the fastest growing brand in the histories of both the Australian and the US wine industry; it was number one imported wine into the US (more than French and italian wines) 2003, it became number one red wine in 750ml bottle sold in the US (more than the same Californian wines) 2005, about 7,500,000 cases sold
  18. 18. 3. An example of Blue Ocean Strategy: [yellow tail] But... 2000, Casella Wines introduced [yellow tail] in the US 2001, about 112,000 cases were sold 2002, it became the fastest growing brand in the histories of both the ? Australian and the US wine industry; it was number one imported o ititalian wines) ey d wine into the US (more than French and h d id t Ho w 2003, it became number one red wine in 750ml bottle sold in the US (more than the same Californian wines) 2005, about 7,500,000 cases sold
  19. 19. 4. The Strategy Canvass and the Four-Actions Framework Some tools for analysis within the Blue Ocean Strategy: The Strategy Canvass The Four-Actions Framework
  20. 20. 4. The Strategy Canvass and the Four-Actions FrameworkA fresh way to picture the industry structure: the strategy canvas High Premium wines Low Budget wines Price Technical Noticeable Aging Vineyard Wine Wine distinctions marketing quality prestige complexity range Dimensions of competition
  21. 21. 4. The Strategy Canvass and the Four-Actions Framework A fresh way to design innovative products: the four-actions framework Reduce Which factors should be reduced well below the industrys standards? Eliminate CreateWhich of the factors that the Which factors should be industry takes for granted A new created that the industry has should be eliminated? value curve never offered? Raise Which factors should be raised well above the industrys standards?
  22. 22. 4. The Strategy Canvass and the Four-Actions Framework A fresh way to design innovative products: the four actions framework Wine complexity Reduce Wine range Vineyard prestige Which factors should be reduced well below the industrys standards? Eliminate CreateWhich of the factors that the Which factors should be industry takes for granted A new created that the industry has should be eliminated? value curve never offered? Complex enological terms Easy drinking Relevance of aging quality Ease of selection Noticeable marketing Raise Fun & adventure Which factors should be raised well above the industrys standards? Price (vs. budget wines) Retail store involvement
  23. 23. 4. The Strategy Canvass and the Four-Actions FrameworkThe design of a new product: [yellow tail]High Premium wines Budget winesLowPrice Technical Noticeable Aging Vineyard Wine Wine distinctions marketing quality prestige complexity range Dimensions Easy drink, ease of selection, of competition fun and adventure
  24. 24. 4. The Strategy Canvass and the Four-Actions Framework(www.yellowtailwine.com)
  25. 25. 4. The Strategy Canvass and the Four-Actions Framework(www.yellowtailwine.com)
  26. 26. 4. The Strategy Canvass and the Four-Actions FrameworkSome features of the [yellow tail] strategy: No heavy marketing & advertising investments No significant resource of distinctive capability No remarkably different or innovative product (its a wine!)While... Reframing of the wine product experience in consumers perception Appeal to non-wine consumers Positioning [yellow tail] as something “not commensurable” with other wines (is it a wine?)
  27. 27. 5. Other instances of Blue Ocean StrategyNintendos Wii (2006) It created a radically different “game concept” with respect to the traditional (i.e., joystick or gamepad based) videogame consoles It attracted those who were traditionally “non-gamer” (e.g., parents) and offered new social venues for entertainment
  28. 28. 5. Other instances of Blue Ocean StrategyDells computers (1990s) It created a radically different retail and delivery system (i.e., direct sales at low cost, customisable machines, and about 4 days delivery time) with respect to competitors It attracted those who had not bought computers before because of ease of access, customisation, and low price
  29. 29. 5. Other instances of Blue Ocean Strategy
  30. 30. 6. SummaryMain pointsStrategic entrepreneurship consists of firms efforts to undertake newbusiness ventures that lead to superior performance in the long termFirms may undertake offensive strategies to undercut competitorswithin the same industry and markets, or avoidance strategies to steerclear of direct confrontation with competitorsBlue Ocean Strategy provides an intellectual and methodologicalapproach to designing strategies intended to guide firms into marketswhere competition is less intenseKey tools are the Strategy Canvass and the Four-Actions Framework

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