BLUE OCEAN PLANNING & EXECUTIONSimply Redesigning Business Models & Making Better Decisions  Dr. Rod Kingrodkuhnking@sbcgl...
“BLUE OCEAN” as an Adjective (Attribute) of the IdealSuccess Criteria for Quick Classification, Design, and Evaluation of ...
WHY REDESIGN EXISTING BUSINESS MODELS?”Greater Competition, Digitalization, and Globalization are Creating Bloody ‘Red Oce...
  To Avoid ‘Ad Hoc’, Reactive, and Uncoordinated Tweaksto Existing Business Model
  To Swim Out of the ‘Red Ocean’ and Make the Competition Irrelevant
To Perfectly Align a Business With Customers’ Demand  for Higher Value (Quotient)
 To Take Advantage of Emerging Opportunities and Technology
To Significantly Redesign Customer Experience for a Higher Value Quotient
 To Facilitate Alignment in Mergers and Acquisitions
  To Respond to Competitive Pressures Including Commoditization
  To Capture Greater Value (Profit) in the Value Chain and Network
To Provide a More Sustainable and Defensible Competitive Advantage</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcg...
HIGHLY SUCCESSFUL REDESIGNS OF CONVENTIONAL BUSINESS MODELSBusinesses With High Value Quotient (VQ)<br />Copyright 2009. D...
WHAT IS THE VALUE QUOTIENT?A Universal Metric of Success and Zoomable Decision-making<br />Ideal VQ Strategy<br />Everyone...
Blue Ocean Plans for a Business Model”Value Quotient Management (VQM) and Zoomable Decision-making”<br />VISIONARY LEVEL<b...
  Global Job Plan
  200,000ft Plan
  100,000ft Plan
  60,000ft Plan</li></ul>STRATEGIC LEVEL<br /><ul><li>  40,000ft Plan
  Strategic Plan</li></ul>OPERATIONAL LEVEL<br />(Value Chain)<br /><ul><li>Tactical Plan
  Customer Result-Aligned Model (CRAM)
Performance Dashboards</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & ...
Process of Blue Ocean Planning & Execution for Business Models“A Simpler Way of Managing the Value Quotient Towards the Id...
  Competitors’ Business Models (Products/Services)</li></ul>Determine Value Quotient Factors for<br /><ul><li>  Existing /...
  Competitors’ Business Models (Products/Services)</li></ul>Draw Shape of Business Models. Then, Outline Competitive Strat...
CUSTOMER JOBS COMPASS: What Jobs Must You Facilitate or Do In a Hierarchy of Customer Needs or ‘Jobs’?<br />Google Search<...
Increase performance of/develop/acquire software applications that customers hire to do ‘Emotional/Social Jobs’
Increase performance of/develop/acquire software applications that customers hire to do ‘Intellectual Jobs’
 (Increase performance of/develop/acquire software applications that customers hire to do ‘Spiritual Jobs’???)</li></ul>Lo...
REDESIGNING BUSINESS MODELS & MAKING BETTER DECISIONS<br />BLUE OCEAN RADAR: 200,000ft Plan <br /><ul><li>  Illustration o...
  Illustration of “Cost vs. Benefit” Trade-offs (Contradictions) & Trends
  Basic Elements of Value Quotient</li></ul>BLUE OCEAN MAP: Global Job Plan<br /><ul><li>Illustration of Current and Desir...
Illustration of IVQ and Market Seg-ments Including Red and Blue Oceans</li></ul>BOND: 100,000ft Plan<br />Ways to Reduce O...
  Visualization of Strategy
  Modeling and Testing of Strategy</li></ul>BLUE OCEAN COMPASS: 60,000ft  …<br /><ul><li>  Visualization of Shape as well ...
  CUSTOMER JOBS COMPASS</li></ul>TOOLS FOR REDESIGNING BUSINESS MODELS & MAKING BETTER DECISIONS<br />STRATEGY RADAR: 40,0...
  Design of Value Proposition</li></ul>IDEAL VALUE CHAIN: Tactical Plan<br /><ul><li>Visualization of Ideal Value Chain (B...
  Flows of Information (Cost and Revenue) & Resources Within a Value Chain or Business Model</li></ul>BLUE OCEAN STRATEGIC...
BLUE OCEAN MAP: Global View of the Value Quotient<br />for Determining Where You and Your Competitors Currently Are & Wher...
BLUE OCEAN RADAR: 200,000ft View of the Value Quotientfor Comparing, Evaluating, and Redesigning Business Models As Well A...
Moore’s Law As A Special Case of the Law of Increasing Value Quotient “The number of transistors on an integrated circuit ...
Using the Blue Ocean Radar to Illustrate Trends in the Evolution of Technology “The Ideal Object Uses Its Internal and “Fr...
Using the Blue Ocean Radar to Illustrate Trends in the Evolution of Technology “The Ideal Object Uses Its Internal and “Fr...
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Simpler Tools for Redesigning Business Models and Making Better Decisions

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This document contains a comprehensive set of tools for facilitating Blue Ocean Thinking and Decision-making as well as for designing Blue Ocean Business Models. The central concept, which ties all the tools, is the Value Quotient (VQ).

The VQ can be used as a universal metric of success and decision-making. Using the VQ allows anyone to introduce the concepts and tools of Blue Ocean Planning & Execution at any level in an organization.

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  • The most successful businesses and individuals have the highest Value Quotient (in a sea without direct competitors).Blue Ocean Planning (Success) Having the highest Value Quotient (VQ) without any direct competition Focuses on the mantra of PFSP: “Perfect, Free, Simple, Personalized”Yellow Ocean Planning (Success)Having the highest Value Quotient (VQ) among a great number of direct competitors
  • ExerciseDesign an object (product/service/business model) that is extraordinary, accessible, uncontested, and personalized.
  • Simpler Tools for Redesigning Business Models and Making Better Decisions

    1. 1. BLUE OCEAN PLANNING & EXECUTIONSimply Redesigning Business Models & Making Better Decisions  Dr. Rod Kingrodkuhnking@sbcglobal.net & http://businessmodels.ning.comhttp://twitter.com/RodKuhnKing<br />Value Quotient (VQ) Management<br />
    2. 2. “BLUE OCEAN” as an Adjective (Attribute) of the IdealSuccess Criteria for Quick Classification, Design, and Evaluation of “Blue Ocean” Objects<br />Blue Ocean PLANNING<br />Blue Ocean Strategy<br />Blue Ocean Mission<br />Blue Ocean Plan<br />Blue Ocean Project<br />Blue Ocean Vision<br />Blue Ocean Product (Design)<br />Blue Ocean Goal<br />Blue Ocean Service (Design)<br />Blue Ocean Objective<br />Blue Ocean BUSINESS MODEL<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    3. 3. WHY REDESIGN EXISTING BUSINESS MODELS?”Greater Competition, Digitalization, and Globalization are Creating Bloody ‘Red Oceans’ for Businesses”<br /><ul><li> To Exponentially Increase Business Growth and Profitability
    4. 4. To Avoid ‘Ad Hoc’, Reactive, and Uncoordinated Tweaksto Existing Business Model
    5. 5. To Swim Out of the ‘Red Ocean’ and Make the Competition Irrelevant
    6. 6. To Perfectly Align a Business With Customers’ Demand for Higher Value (Quotient)
    7. 7. To Take Advantage of Emerging Opportunities and Technology
    8. 8. To Significantly Redesign Customer Experience for a Higher Value Quotient
    9. 9. To Facilitate Alignment in Mergers and Acquisitions
    10. 10. To Respond to Competitive Pressures Including Commoditization
    11. 11. To Capture Greater Value (Profit) in the Value Chain and Network
    12. 12. To Provide a More Sustainable and Defensible Competitive Advantage</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    13. 13. HIGHLY SUCCESSFUL REDESIGNS OF CONVENTIONAL BUSINESS MODELSBusinesses With High Value Quotient (VQ)<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    14. 14. WHAT IS THE VALUE QUOTIENT?A Universal Metric of Success and Zoomable Decision-making<br />Ideal VQ Strategy<br />Everyone to continuously maximize benefit while minimizing cost throughout the value chain<br />+<br />-<br />Note<br />Value Quotient <br />= Advantage/Disadvantage<br />= Benefit/Cost<br />= Revenue/Cost<br />= Strength/Weakness<br />= Opportunity/Threat<br />= Reward/Risk<br />= Relevant Content/Noise<br />= Positives/Negatives<br />= Delight/Pain<br />= Good/Bad<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    15. 15. Blue Ocean Plans for a Business Model”Value Quotient Management (VQM) and Zoomable Decision-making”<br />VISIONARY LEVEL<br /><ul><li> Customer Jobs Plan
    16. 16. Global Job Plan
    17. 17. 200,000ft Plan
    18. 18. 100,000ft Plan
    19. 19. 60,000ft Plan</li></ul>STRATEGIC LEVEL<br /><ul><li> 40,000ft Plan
    20. 20. Strategic Plan</li></ul>OPERATIONAL LEVEL<br />(Value Chain)<br /><ul><li>Tactical Plan
    21. 21. Customer Result-Aligned Model (CRAM)
    22. 22. Performance Dashboards</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    23. 23. Process of Blue Ocean Planning & Execution for Business Models“A Simpler Way of Managing the Value Quotient Towards the Ideal”<br />SSTART<br />Choose (Another) Level and Type of Blue Ocean Plan for<br /><ul><li> Existing Business Model (Product/Service)
    24. 24. Competitors’ Business Models (Products/Services)</li></ul>Determine Value Quotient Factors for<br /><ul><li> Existing /Desired Business Model (Product/Service)
    25. 25. Competitors’ Business Models (Products/Services)</li></ul>Draw Shape of Business Models. Then, Outline Competitive Strategies. Next, Calculate Value Quotient (VQ) of<br />Existing/Desired Business Models (Product/Service)<br />Visionary & Strategic Blue Ocean Plans Done?<br />No<br />Yes<br />Prepare and Implement Tactical Blue Ocean Plans & Monitor VQ of Blue Ocean Projects & Model<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    26. 26. CUSTOMER JOBS COMPASS: What Jobs Must You Facilitate or Do In a Hierarchy of Customer Needs or ‘Jobs’?<br />Google Search<br />ELEMENTS OF CUSTOMER JOBS-BUSINESS MODEL:<br />Long-term Competitive Advantage Scenarios<br /><ul><li> Increase performance of/develop/acquire software applications that customers hireto do ‘Physical Jobs’
    27. 27. Increase performance of/develop/acquire software applications that customers hire to do ‘Emotional/Social Jobs’
    28. 28. Increase performance of/develop/acquire software applications that customers hire to do ‘Intellectual Jobs’
    29. 29. (Increase performance of/develop/acquire software applications that customers hire to do ‘Spiritual Jobs’???)</li></ul>Long-term Value Proposition<br /><ul><li> ‘Total Happiness’ For All Customer Jobs on the Internet</li></ul>Targeted Customer Segments (Niches)<br /><ul><li> ‘Short and Long Tail’ of Users on the Internet</li></ul>Existing Impact of Google Search on Total Jobs<br /><ul><li> Average Impact of Google on Total Jobs =</li></ul> (6 + 2 + 5.5 + 2)/4 = 4.3<br />Impact of Ideal Software on Total Jobs<br />Impact of Ideal Software on Total Jobs =<br />‘Perfect 10’<br />(for Developing Tools to Make Customers Happier As Well As for Determining What ‘Jobs’ or Niche(s) of Total Happiness to Focus on)<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    30. 30. REDESIGNING BUSINESS MODELS & MAKING BETTER DECISIONS<br />BLUE OCEAN RADAR: 200,000ft Plan <br /><ul><li> Illustration of Ideal Business Result
    31. 31. Illustration of “Cost vs. Benefit” Trade-offs (Contradictions) & Trends
    32. 32. Basic Elements of Value Quotient</li></ul>BLUE OCEAN MAP: Global Job Plan<br /><ul><li>Illustration of Current and Desired Positions of You & Your Competitors
    33. 33. Illustration of IVQ and Market Seg-ments Including Red and Blue Oceans</li></ul>BOND: 100,000ft Plan<br />Ways to Reduce Obstacles to Goal:<br /><ul><li> Facilitation of Decision-making
    34. 34. Visualization of Strategy
    35. 35. Modeling and Testing of Strategy</li></ul>BLUE OCEAN COMPASS: 60,000ft …<br /><ul><li> Visualization of Shape as well as Trends of Competing, Desired, and Ideal Business Results (Models)
    36. 36. CUSTOMER JOBS COMPASS</li></ul>TOOLS FOR REDESIGNING BUSINESS MODELS & MAKING BETTER DECISIONS<br />STRATEGY RADAR: 40,000ft Plan<br /><ul><li> Illustration of Detailed Shape of Competing, Desired, and Ideal Business Results (Models)
    37. 37. Design of Value Proposition</li></ul>IDEAL VALUE CHAIN: Tactical Plan<br /><ul><li>Visualization of Ideal Value Chain (Business Model) for IVQ Strategy
    38. 38. Flows of Information (Cost and Revenue) & Resources Within a Value Chain or Business Model</li></ul>BLUE OCEAN STRATEGIC PLAN<br /><ul><li>Elements and Resources for Pursuing Goal of Ideal Value Quotient (Blue Ocean), Achieving Blue Ocean Plan, and Totally Engaging Employees and Other Stakeholders</li></ul>WHEEL OF OBSTACLES<br /><ul><li> Illustration of Internal Obstacles and Constraints to Achieving the Ideal Value Quotient for the Value Chain or Business Model</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    39. 39. BLUE OCEAN MAP: Global View of the Value Quotient<br />for Determining Where You and Your Competitors Currently Are & Where You Must Go<br />IDEAL VALUE QUOTIENT (BLUE OCEAN) <br />Fractal Market Segmentation (Niches) of Search Engine Market<br />∞<br /> Highly differentiated and premium-priced/free value chain<br />BLUE OCEAN Google Search<br />Value Quotient (VQ)<br />Blue Ocean Plan<br />(+):<br />DELIGHT<br />Lowly differentiated and low-cost value chain<br />RED OCEAN * “Me Too” Search Engine<br />Strategic Choice<br />Red Ocean Plan<br />(-): PAIN <br /> (Uncontested Experience, Market Space, or New Category)<br /> No. of Direct Competitors<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    40. 40. BLUE OCEAN RADAR: 200,000ft View of the Value Quotientfor Comparing, Evaluating, and Redesigning Business Models As Well As Products and Services<br />Ideal Value Quotient(Blue Ocean)<br />Object/Core Job: ………………………………..…….<br />(cf. Goal of IVQ to Moore’s Law & “Singularity”)<br />Desired VQ = 8/2= 4<br />Existing VQ = 2/6= 0.33 &lt; 1<br />(Free)<br />COST<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    41. 41. Moore’s Law As A Special Case of the Law of Increasing Value Quotient “The number of transistors on an integrated circuit roughly doubles every two years”<br />Ideal Value Quotient (Blue Ocean or “Singularity”)<br />Object/Core Job: Integrated Circuit Board<br />(cf. Goal of IVQ to Moore’s Law & “Singularity”)<br />VQ = 8/1= 8<br />VQ = 4/1= 4<br />VQ = 2/1= 2<br />(Free)<br />COST<br />(Size)<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    42. 42. Using the Blue Ocean Radar to Illustrate Trends in the Evolution of Technology “The Ideal Object Uses Its Internal and “Free” Resources to Instantly Do Its Job at No Cost and Without Any Negative Effect”<br />Ideal Value Quotient (INTERNET or “Singularity”)<br />Object/Core Job: Computer/Storage Devices<br />IVQ –Problem Solving Look within and across industries as well as in nature for similar or analogous resolution of trade-off<br />Desktop Computer<br />Mini-computer<br />Laptop Computer<br />Palmtop Computer<br />Old Mainframe Computer<br />(Free)<br />COST<br />(Size)<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    43. 43. Using the Blue Ocean Radar to Illustrate Trends in the Evolution of Technology “The Ideal Object Uses Its Internal and “Free” Resources to Instantly Do Its Job at No Cost and Without Any Negative Effect”<br />Ideal Value Quotient (LIGHT or Blue Ocean)<br />Object/Core Job: Vehicles<br />IVQ –Problem Solving Look within and across industries as well as in nature for similar or analogous resolution of trade-off<br />Rocket<br />Aircraft<br />Train<br />Car<br />Bicycle<br />Ship<br />(Free)<br />COST<br />(Size)<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    44. 44. Using the Blue Ocean Radar to Creatively Resolve Trade-offs “Someone, Somewhere May Have Already Resolved Your Trade-off or Contradiction”<br />Ideal Value Quotient (Blue Ocean or Zoomable Page)<br />Object/Core Job: Linear Page<br />IVQ –Problem Solving Look within and across industries as well as in nature for similar or analogous resolution of trade-off<br />Existing Paradigm (VQ = 6/8 = 0.75)<br />Breakthrough Paradigm VQ = 8/2 = 4<br />(Free)<br />COST<br />(No. of Pages)<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    45. 45. Using the Blue Ocean Radar to Creatively Resolve Trade-offs “Someone, Somewhere May Have Already Resolved Your Trade-off or Contradiction”<br />Ideal Value Quotient (Blue Ocean or Zoomable Page)<br />Object/Core Job: Web Interface<br />IVQ –Problem Solving Look within and across industries as well as in nature for similar or analogous resolution of trade-off<br />Existing Paradigm (VQ = 6/8 = 0.75)<br />Breakthrough Paradigm VQ = 8/2 = 4<br />(Free)<br />COST<br />(‘Noise’)<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    46. 46. Using the Blue Ocean Radar to Creatively Resolve Trade-offs “Someone, Somewhere May Have Already Resolved Your Trade-off or Contradiction”<br />Ideal Value Quotient (Blue Ocean or “Singularity”)<br />Object/Core Job: Vehicles<br />IVQ –Problem Solving Look within and across industries as well as in nature for similar or analogous resolution of trade-off<br />Conventional Thinking VQ = 8/7= 1.1<br />Optimum VQ = 8/4= 2<br />Existing VQ = 6/4= 1.5<br />(Free)<br />COST<br />Value Quotient (VQ) = Benefit/Cost = Revenue/Cost = <br />Revenue to Cost Ratio = Slope of Value Quotient Line<br />Ideal Value Quotient (Blue Ocean) Ideal Final Result of Continuously Implementing IVQ Decisions Job To Be Done (JBTD) at No Cost & With No Negative Effect<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    47. 47. BLUE OCEAN NETWORK DIAGRAM: 100,000ft View of the Value Quotientfor Quickly Making Better Decisions, Goals, and Strategies in Business (Projects)<br />BENEFIT<br />Ideal VQ Strategy<br />Everyone to continuously maximize benefit while minimizing cost throughout the value chain<br />Quality <br />24x7 Personalization/ Customization<br />CUSTOMERS (Sales/Revenue)<br />COST (Price)<br />Differentiation (Simplicity/Brand/ Novelty)<br />Business Action …<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    48. 48. BLUE OCEAN NETWORK DIAGRAM: 100,000ft View of the Value Quotientfor Visualizing Goals & Strategy for IVQ : Case of Google Search<br />BENEFIT<br />Ideal VQ Strategy<br />Everyone to continuously maximize benefit while minimizing cost throughout the value chain<br />Quality (Speed):<br />INCREASE<br />24x7 Personalization: INCREASE<br />CUSTOMERS (Sales/Revenue)<br />COST (Price): REDUCE<br />Differentiation (Simplicity/Brand): INCREASE <br />Business Action …<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    49. 49. BLUE OCEAN NETWORK DIAGRAM: 100,000ft View of the Value Quotientfor Modeling Strategy & Assumptions of IVQ: Case of Google Search<br />Ideal VQ Strategy<br />Everyone to continuously maximize benefit while minimizing cost throughout the value chain<br />Quality (Speed) <br />+<br />?<br />+<br />+<br />+<br />+<br />-<br />24x7 Personalization/ Customization<br />CUSTOMERS (Sales/Revenue)<br />COST (Price)<br />+<br />+<br />+<br />-<br />+<br />+<br />+<br />+<br />-<br />+<br />Differentiation (Simplicity/Brand/ Novelty)<br />+<br />Business Action …<br />+<br />+<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    50. 50. BLUE OCEAN NETWORK DIAGRAM: 100,000ft View of the Value Quotientfor Scoring Elements of the Value Quotient for a Business (Project)<br />BENEFIT<br />Quality:<br />(1-10) <br />24x7 Personalization:<br />(1-10)<br />CUSTOMERS (Sales/Revenue)<br />COST (Price):<br />(1-10)<br />Differentiation (Simplicity/Brand):(1-10)<br />Business Action …<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    51. 51. BLUE OCEAN COMPASS: 60,000ft View of the Value Quotient<br />Google Search<br />4 ELEMENTS OF BUSINESS MODEL:<br />Competitive Advantage Strategies<br /><ul><li> Increase quality (speed) to level 9
    52. 52. Maintain cost at free: level 1
    53. 53. Increase differentiation (simplicity/relevance/ brand/novelty) to level 8
    54. 54. Increase on-demand; 24x7/(personalization; customization) services to level 8</li></ul>Value Propositions (Innovative Processes)<br /><ul><li> Higher quality (speed) and greater simplicity
    55. 55. Higher differentiation (simplicity/relevance/ brand/novelty) at no additional cost
    56. 56. Higher 24x7 personalization (for advertisers/ affiliates: AdWords; AdRank; AdSense) </li></ul>Targeted Customer Segments (Niches)<br /><ul><li> Students/Researchers/Internet Users who directly and quickly want information
    57. 57. Early adopter/innovator; Non-customers
    58. 58. Low cost-Advertisers
    59. 59. Website Owners/Content Providers</li></ul>Value Quotient (VQ)<br /><ul><li> Benefit = Quality + Differentiation + Personalization = (9 + 8 + 8)/3 = 25/3 = 8.3
    60. 60. Cost = 1
    61. 61. Value Quotient (VQ) = 8.3/1 = 8.3</li></ul>(for Generally Redesigning a Business Model & Value Proposition)<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    62. 62. STRATEGY RADAR: 40,000ft View of the Value Quotient<br />Southwest Airlines<br />4 ELEMENTS OF BUSINESS MODEL:<br />Competitive Advantage Strategies<br />Quality (Q)<br /><ul><li> Increase speed to level 9</li></ul>Cost ( C )<br /><ul><li> Reduce ticket price to level 1.3</li></ul>Differentiation (D)<br /><ul><li> Reduce lounges to level 1.2
    63. 63. Reduce meals to level 2.1
    64. 64. Increase friendly service to level 8.8</li></ul>Personalization (P)<br /><ul><li> Reduce personalization to level 1</li></ul>Value Propositions (Innovative Processes)<br /><ul><li> Higher speed at lower cost
    65. 65. Friendlier service at lower cost</li></ul>Targeted Customer Segments (Niches)<br /><ul><li> Frequent/Low-cost traveler
    66. 66. Early adopter/innovator; Non-customers</li></ul>Value Quotient (VQ)<br /><ul><li> Benefit = Quality + Differentiation + Customization = (9 + 1.2 + 2.1 + 8.8 + 1)/5 = 22.1/5 = 4.42
    67. 67. Cost = 1.3
    68. 68. Value Quotient (VQ) = 4.42/1.3 = 3.4</li></ul>(for More Specifically Redesigning a Business Model & Value Proposition)<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    69. 69. How to Quickly Develop an IVQ Strategy and Value Quotient<br />Obtain, from customer interviews or questionnaires, scores for the existing performance of each element or “value quotientfactor” on the Blue Ocean Network Diagram (BOND) and for the surveyed or “Red Ocean” company.<br />Score each element of Value Quotient using a scale from 1 (low) to 10 (high):<br /><ul><li>Quality: (1-10)
    70. 70. Cost: (1-10)
    71. 71. Differentiation: (1-10)
    72. 72. Personalization (Customization): (1-10)</li></ul>Plot, on a Blue Ocean Compass, the average score for each element. Then, draw the profile or radar chart for the existing performance of the surveyed company.<br />Explore scenarios for desired or futureprofilesthat are strongly differentiated from “Red Ocean” profiles as well as lie closer to the “ideal” Blue Ocean.<br />Choose the Blue Ocean profile with the highest Value Quotient (VQ). Then, derive corresponding IVQ (Blue Ocean) strategies for competitive advantage and value propositions for segments (“niches”) of customers.<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    73. 73. BLUE OCEAN STRATEGIC PLAN: Strategic View of the Business<br />for FacilitatingIVQ Strategy Execution, Organizational Alignment, and Total Employee Engagement<br />INDUSTRY/BUSINESS<br /> <br /><ul><li> Industry: Computer (Software); Advertising
    74. 74. Niche: Internet Search; Online Ads
    75. 75. Model: Business to Consumer (B2C); Business to Business (B2B); Platform</li></ul>COMPANY BACKGROUND<br /><ul><li> Location: Mountain View, California
    76. 76. Founder(s): Sergey Brin; Larry Page
    77. 77. Revenue: US$21.79 billion (2008)
    78. 78. No. of Direct Competitors:</li></ul>PRODUCTS/SERVICES<br /><ul><li>  Internet Search Engine: Google Search
    79. 79. Online Bidding Platform:Adwords
    80. 80. Online Syndicated Ads: Adsense
    81. 81. Complementary Apps: Maps, etc.</li></ul>CUSTOMER VALUE PROPOSITION<br /><ul><li> Uncluttered, fast, free, accurate search engine results and experience
    82. 82. Monetization of web page/site
    83. 83. Targeted, measurable, cost-effective, and relevant online advertising</li></ul>BLUE OCEAN STRATEGIC PLAN FOR: GOOGLE SEARCH<br />CUSTOMER BENEFITS/EXPERIENCE<br /><ul><li> Simple interface/Easy to use
    84. 84. Fast, accurate, and relevant results
    85. 85. Free search service
    86. 86. Unobtrusive ads; Site monetization
    87. 87. Targeted ads based on page’s content</li></ul>VISION (“Future Headline”)<br /><ul><li> Search engine platform; Software-as-a-Service (platform)
    88. 88. Advertising platform
    89. 89. Gateway to world’s knowledge-base</li></ul>MAIN GOAL/OBJECTIVE/STRATEGY<br />Blue Ocean Strategic Plan for providing an unprecedented customer experience<br /><ul><li> (See Blue Ocean Compass & Blue Ocean Map; Blue Ocean PAD; Value Chain Model; Blue Ocean Dashboard)</li></ul>MISSION/CORE VALUES<br /><ul><li> “To organize the world's information and make it universally accessible and useful”
    90. 90. “Don’t Be Evil”</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    91. 91. BLUE OCEAN STRATEGIC PLAN: Strategic View of the Business<br />for FacilitatingIVQ Strategy Execution, Organizational Alignment, and Total Employee Engagement<br />INDUSTRY/BUSINESS<br /><ul><li> Industry: Airline/Transportation
    92. 92. Niche: Short-haul, low-cost air travel
    93. 93. Model: Point-to-point air travel with ‘no frills’ to secondary city-airports (cf. hub-and-spokes model with meal)</li></ul>COMPANY BACKGROUND<br /><ul><li> Location: Dallas,Texas (USA)
    94. 94. Founder(s): Herb Kelleher; Rollin King (1967 inc.; first flight in 1971)
    95. 95. Revenue: $11 Billion (2008)
    96. 96. No. of Direct Competitors:</li></ul>PRODUCTS/SERVICES<br /><ul><li> Airline
    97. 97. Aircrafts
    98. 98. Air travel/transportation</li></ul>CUSTOMER VALUE PROPOSITION<br />“The speed of a plane at the price of a car …”<br />Targeted Customer Segment: Frequent/low-cost travelers<br />BLUE OCEAN STRATEGIC PLAN FOR: SOUTHWEST AIRLINES<br />CUSTOMER BENEFITS/EXPERIENCE<br /><ul><li> Faster travel at lower cost
    99. 99. Simple fare structure</li></ul>VISION (“Future Headline”)<br />“Do the right thing.” <br />MAIN GOAL/OBJECTIVE/STRATEGY<br />Blue Ocean Strategic Plan for quickly reaching destination at the lowest price<br /><ul><li> (See Blue Ocean Compass & Blue Ocean Map; Blue Ocean PAD; Value Chain Model; Blue Ocean Dashboard)</li></ul>MISSION/CORE VALUES<br />“Dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit.”<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    100. 100. Ideal Value Chain (Business Model): Tactical View<br />“Perfect, Free, Simple, and Personalized (PFSP)” <br />E: EMPLOYEES/KNOWLEDGE ASSETS/ CULTURE<br /><ul><li> Highly Productive/Creative workers
    101. 101. (Experienced) Management
    102. 102. Patented PageRank Algorithm
    103. 103. Android: Operating System
    104. 104. Software Development Kits (SDK)</li></ul>S: SUPPLIERS/MATERIALS<br /><ul><li>Computers
    105. 105. Servers
    106. 106. Other Items</li></ul>M: MACHINERY/EQUIPMENT/ FACILITY<br />External <br /><ul><li> Efficient Data Centers/Scalable Architecture/Server Farms
    107. 107. Wi-Fi Infrastructure
    108. 108. Satellite</li></ul>E: ENVIRONMENT<br /><ul><li> Competitors: Yahoo; AOL; MSN; etc.
    109. 109. Non-customers/Non-consumers
    110. 110. Partners/Complementors
    111. 111. Investors/Board of Directors
    112. 112. Gov./Community (Open Source)/Env.</li></ul>GOOGLE’S VALUE CHAIN (Business Model)<br />P: PROCESSES/STRATEGIES<br /><ul><li> Procurement; HR Mngt; Operations
    113. 113. Technology/R & D/Innovn/Production
    114. 114. Marketing/Branding/PR/Sales
    115. 115. Distribution/Logistics/Partnering
    116. 116. Customer Service (Relationship Mngt)</li></ul>“PFSP”<br />R: RETAILERS/DISTRIBUTORS/ CHANNELS<br /><ul><li> Website Owners
    117. 117. Content Providers: Individuals/ Corporations (Portals)
    118. 118. Affiliates; Partners: OEMs; Browsers</li></ul>C: CUSTOMERS/CONSUMERS<br /><ul><li> Web Users/Searchers: Desktop/Mobile
    119. 119. Website Owners
    120. 120. Advertisers - > Revenue
    121. 121. Enterprises (Search) -> Revenue
    122. 122. Software/API Developers</li></ul>O: OUTPUTS/PRODUCT/SERVICE<br /><ul><li> Google Search Engine/Search platform
    123. 123. Bidding & Advertising Platform: AdWords; AdSense; AdRank
    124. 124. Other Products/Apps such as Google Appliance</li></ul>KEY<br />Revenue (Information Flow)<br />Cost(Information Flow)<br />Strategic Question: What is the Value Quotient (VQ) of elements of the value chain as well as the entire value chain?<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    125. 125. Ideal Value Chain (Business Model): Tactical View<br />“Perfect, Free, Simple, and Personalized (PFSP)” <br />E: EMPLOYEES/KNOWLEDGE ASSETS/ CULTURE<br /><ul><li> Pilots
    126. 126. Affable (Friendly) Stewardesses
    127. 127. Management
    128. 128. Other Employees</li></ul>S: SUPPLIERS/MATERIALS<br /><ul><li> Fuel Suppliers
    129. 129. Aircrafts and Parts</li></ul>M: MACHINERY/EQUIPMENT/ FACILITY<br /><ul><li> One Type of Aircraft: Boeing 737
    130. 130. IT/Online Infrastructure
    131. 131. Wi-Fi</li></ul>E: ENVIRONMENT<br /><ul><li> Competitors
    132. 132. Non-customers/Non-consumers
    133. 133. Partners
    134. 134. Investors /Board of Directors
    135. 135. Gov./Community/Society/Environment</li></ul>SOUTHWEST AIRLINES’S VALUE CHAIN (Business Model)<br />P: PROCESSES/STRATEGIES<br /><ul><li> Point-to-point Travel: Flying Multiple, Quick, Short Trips
    136. 136. Quick Turnaround Processes
    137. 137. Employee-profit-sharing
    138. 138. Hedging of Fuel Prices</li></ul>“PFSP”<br />R: RETAILERS/DISTRIBUTORS/ CHANNELS/INTERFACE<br /><ul><li> Website (www.southwest.com)
    139. 139. Google Search (AdWords)
    140. 140. TV ads</li></ul>C: CUSTOMERS/CONSUMERS<br /><ul><li>Low-cost Travelers
    141. 141. Frequent Travelers
    142. 142. Intercity Travelers</li></ul>O: OUTPUTS/PRODUCT/SERVICE<br /><ul><li> Air Travel Ticket/eTicket/Service
    143. 143. Website (www.southwest.com)
    144. 144. Rapid Rewards Program
    145. 145. 2/3 Customer Luggage for Free
    146. 146. No frills-meal: ‘Snack Pack’</li></ul>KEY<br />Revenue (Information Flow)<br />Cost (Information Flow)<br />Strategic Question: What is the Value Quotient (VQ) of elements of the value chain as well as the entire value chain?<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    147. 147. Template for Ideal Value Chain (Business Model)<br />Flows & Resources for “Perfect, Free, Simple, and Personalized (PFSP)” <br />E: EMPLOYEES/KNOWLEDGE ASSETS/ CULTURE<br />S: SUPPLIERS/MATERIALS<br />M: MACHINERY/EQUIPMENT/ FACILITY<br />E: ENVIRONMENT<br /><ul><li> Competitors
    148. 148. Non-customers/Non-consumers
    149. 149. Partners
    150. 150. Investors
    151. 151. Gov./Community/Society/Environment</li></ul>IDEAL VALUE CHAIN (BUSINESS MODEL):<br />Flows & Resources -<br />“Perfect, Free, Simple, and Personalized”<br />P: PROCESSES/STRATEGIES<br /><ul><li> Procurement; HR Mngt; Operations
    152. 152. Technology/R & D/Innovn/Production
    153. 153. Marketing/Branding/PR/Sales
    154. 154. Distribution/Logistics/Partnering
    155. 155. Customer Service (Relationship Mngt)</li></ul>R: RETAILERS/DISTRIBUTORS/ CHANNELS/INTERFACE<br />C: CUSTOMERS/CONSUMERS<br />O: OUTPUTS/PRODUCT/SERVICE<br />KEY<br />Revenue (Information Flow)<br />Cost (Information Flow)<br />Strategic Question: What is the Value Quotient (VQ) of elements of the value chain as well as the entire value chain?<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    156. 156. SWOT Resources in Value Chain<br />for Identifying Resources for Projects and Plans to Achieve the Desired or Ideal Value Quotient<br />S: STRENGTHS<br />O: OPPORTUNITIES<br />SWOT Resources <br />in Value Chain for:<br />W: WEAKNESSES<br />T: THREATS<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    157. 157. BCRR Impacts in Value Chain<br />for Assessing the Impacts and Feasibility of Objects, Tasks, and Projects<br />B: BENEFITS (Now)<br />R: REWARDS (Later)<br />Value Chain’s OBJECT/TASK/PROJECT:<br />C: COSTS<br />R: RISKS<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    158. 158. WHEEL OF OBSTACLES3 Internal Obstacles to Realizing the Ideal Value Quotient (IVQ) or Blue Ocean <br />AIG<br />Denver Airport<br />Enron<br />Alaska’s Road to Nowhere<br />“Me Too” Search Engines<br />Detroit Automakers<br />Traditional Airlines<br />Healthcare<br />“Mom and Pop” Businesses<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    159. 159. Why Many Businesses Are Not Achieving Blue Ocean-Success<br />How to Determine Whether You Need to Adopt Blue Ocean Planning, Strategy, and Execution<br /><ul><li> Business does not have a tacit or an explicit Blue Ocean Plan and Strategy.
    160. 160. Business does not have and live by Blue Ocean Vision, Value Proposition, and Value Quotient Management.
    161. 161. Business does not have access to a metric for easily defining, measuring, and managing decisions towards the Ideal Value Quotient (Blue Ocean Success) at every level in an organization.
    162. 162. Business does not have access to easy-to-learn-and-use tools for Blue Ocean Planning, Strategy, Execution, and Monitoring.</li></ul>WHY MANY BUSINESSES ARE NOT ACHIEVING BLUE OCEAN SUCCESS<br /><ul><li>The business’s resources especially employees are not effectively engaged and aligned with Blue Ocean Planning, Strategy, and Execution.
    163. 163. Business uses an ‘ad hoc’, reactive, and uncoordinated approach to redesigning business model (in contrast to systematic Blue Ocean Planning, Strategy, Execution and Monitoring).
    164. 164. Business is experiencing the 3 obstacles to Blue Ocean Success: inadequate decision-making; uninspiring business goals and targets; Red Ocean (“Me Too”)-strategies and business models.
    165. 165. Extraordinary, no contest-success follows the 4% rule: exceptional and unique success is achieved by 20% of 20% of a given set; this is an iterative application of the 80-20 (Pareto) Principle.</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    166. 166. APPENDICES<br /><ul><li> Innovative Processes for Redesigning Business Models & Pursuing the Ideal Value Quotient (VQ)
    167. 167. Blue Ocean Network Diagram (BOND): What and Why?
    168. 168. 4 Axioms of the Ideal Value Quotient (VQ)
    169. 169. Related Concepts of the Ideal Value Quotient (VQ)
    170. 170. The Law of Increasing Value Quotient
    171. 171. Customer Result-Alignment Model (CRAM)
    172. 172. Space-Time Template for the Evolution of a System</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    173. 173. INNOVATIVE PROCESSES FOR REDESIGNING BUSINESS MODELS & PURSUING THE IDEAL VALUE QUOTIENT<br />(Achieving apparently impossible business goals, strategies, and value propositions)<br />EMPLOYEE PROCESSES<br /><ul><li> Specialization/IP Creation-Protection
    174. 174. Outsourcing/Sub-contracting/Agents
    175. 175. ‘Star’ Performers/Top grading/Fun
    176. 176. Wisdom of the Crowd/Co-creation
    177. 177. Cross-functional Teams/Downsizing</li></ul>GENERAL PROCESSES<br /><ul><li> Vertical/Horizontal Integration
    178. 178. Extension/Compression/Removal
    179. 179. Open Collaboration/Long Tail (80-20)
    180. 180. Unbundling/De-integration/Bundling
    181. 181. Convergence/Standardization/Self-X</li></ul>MACHINERY/FACILITY PROCESSES<br /><ul><li> Franchise/Leasing/Rental
    182. 182. Localization/Substitution/Reversal
    183. 183. Modularization/Standardization
    184. 184. Asymmetry/’Poka Yoke’/Nesting
    185. 185. Attributes Interdependency</li></ul>ENVIRONMENT/SUPPLIER PROCESSES<br /><ul><li> Partnering/Complementing/Feedback
    186. 186. Merging/(De)Centralizing/Integration
    187. 187. Networking/Volunteering/Recycling
    188. 188. Convergence/(De)Regulation
    189. 189. Distributorship/Affiliates/Network</li></ul>INNOVATIVE PROCESSES FOR REDESIGNING BUSINESS MODELS & PURSUING THE IDEAL VALUE QUOTENT <br />DOMAIN-PROCESSES/FUNCTIONALITY<br /><ul><li> Digitalization/Idealization/Downsizing
    190. 190. Virtualization/Customization/DIY/JIT
    191. 191. Zero Defect/Lean/Six Sigma/Analytics
    192. 192. Automatic/Outsourcing/Scalability
    193. 193. Restructuring/Inventive Principles</li></ul>CHANNEL/WHOLESALERS PROCESSES<br /><ul><li> Multiple Channels/Syndication/Chain
    194. 194. Pyramid/Multi-level Markets/Wheel
    195. 195. Digitalization/Online/Word-of-mouth
    196. 196. Distributorship/Affiliates/Network
    197. 197. Advertising/Auction Platform/Partners</li></ul>CUSTOMER PROCESSES<br /><ul><li> Segmentation/Direct Selling/Branding
    198. 198. Cross-subsidy/Hybridized Markets
    199. 199. Subscription/Leasing/After Sale
    200. 200. Auction/Co-creation/Collaboration
    201. 201. Advertising/Freemium/Licensing</li></ul>PRODUCT/SERVICE PROCESSES<br /><ul><li> Product/Service-Platform/Package
    202. 202. Service-focus/Servicing/Upgrading
    203. 203. Performance-based Pricing/Discounts
    204. 204. Fixed product (shell) and recurring/ replaceable/upgradeable component</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    205. 205. BLUE OCEAN NETWORK DIAGRAM (BOND)What and Why?<br />What is the Blue Ocean Network Diagram (BOND)?<br /><ul><li>A tool for redesigning business models, pursuing the Ideal Value Quotient (IVQ), and making better decisions
    206. 206. Universal tool and visual framework for quickly and systematically eliminating 3 critical obstacles to the Ideal Value Quotient (IVQ): poor business decisions; uninspiring business goals and targets; Red Ocean (“Me Too”) strategies & models
    207. 207. Global view of “What customers want” or “Voice of the Customer”</li></ul>Why Blue Ocean Network Diagram (BOND)?<br /><ul><li>Facilitates decision-making for management and employees as well as board of directors
    208. 208. Facilitates organizational alignment and engagement especially for employees; everyone is on the same page and using the same metrics
    209. 209. Provides simple framework for visualizing Blue Ocean Strategy and IVQ
    210. 210. Provides simple visual framework for modeling as well as reviewing business strategies, objectives, models, assumptions, trade-offs, and decisions
    211. 211. Provides transparency in the selection and weighting of “value quotient factors” or decision-making criteria for evaluating possible business choices
    212. 212. Facilitates calculation of the value quotient for a business</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    213. 213. 4 Axioms of the Ideal Value Quotient (VQ)<br />Every object, which has sustainable growth, generally increases its Value Quotient (VQ) over time. Otherwise, the object declines and eventually dies.<br />A real-world object exhibits trade-offs or contradictions: advantages accompa-nied by disadvantages; benefits accompanied by costs; positives accompanied by negatives; delight accompanied by pain; good accompanied by evil.<br />An ideal object has an ideal Value Quotient (VQ), that is, lives in a “Blue Ocean” with no trade-off or contradiction: infinite advantages and no disadvantage; infinite benefits and no cost; infinite positive effects and no negative effect; infinite delight and no pain; good without any bad. The ideal object has zero mass and uses its internal and ‘free’ resources to perfectly do its job at no extra cost, at any time, and without any disadvantage.<br /> Over time, aspecies or an ecosystem of real-world objects evolves towards the ideal object. Otherwise, the species declines and becomes extinct.<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    214. 214. Related Concepts of the Ideal Value Quotient (VQ)<br /><ul><li>Value Quotient (Value Engineering)
    215. 215. Ideal Final Result (IFR); Ideality (TRIZ); SWOT Analysis (Business Planning)
    216. 216. Benefit/Cost Ratio; Revenue to Cost Ratio (Financial Planning)
    217. 217. Moore’s Law (Gordon Moore); Law of Accelerating Returns; Singularity (Ray Kurzweil)
    218. 218. Disruptive Innovation (Clayton Christensen)
    219. 219. Decision Theory: Rationality; Optimality; Satisficing Behavior (Economics)
    220. 220. Invisible Hand; Market Forces (Economics); 80-20 Rule (Vilfredo Pareto)
    221. 221. Theory of Evolution(Charles Darwin)</li></ul>Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    222. 222. The Law of Increasing Value Quotient<br />The Value Quotient (VQ) of a technological device as well as living system tends to follow the shape of an envelope of S-Curves that progresses towards a point of infinite Value Quotient. Otherwise, the technological device or living system declines and dies.<br />Value Quotient (VQ)<br />Envelope of S-Curves<br />Time<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    223. 223. Customer Result-Alignment Model (CRAM) For Ensuring That Customer’s Desired Result Aligns With Value Proposition & Tool of Business Model<br />CUSTOMER (Segment)<br /><ul><li> Description/Profile
    224. 224. Problems/Needs
    225. 225. Needs/Jobs/Goals
    226. 226. Core Values/Ideals</li></ul>ADVANTAGES (+)<br /><ul><li> Benefit (Revenue)
    227. 227. Useful Effect
    228. 228. Opportunity
    229. 229. Reward</li></ul>Value Quotient (VQ) = Advantages/Disadvantages<br />chooses/hires<br />(pays for)<br />WANTS (on demand)<br />obtains<br />provides<br />OBJECT (Interface)<br /><ul><li> Material (Features)
    230. 230. Product (Features)
    231. 231. Service (Features)
    232. 232. Personnel/Business</li></ul>TOOL<br /><ul><li> Business (Chain)
    233. 233. Product
    234. 234. Service
    235. 235. Personnel</li></ul>RESULT/OUTPUT<br /><ul><li> Tangible Results
    236. 236. Intangible Results
    237. 237. Value Proposition</li></ul>that provides<br />(operates on)<br />THAT YIELDS<br />provides<br />enables<br />obtains<br />DRIVING FORCE<br /><ul><li> Tangibles: Profit
    238. 238. Intangibles: Culture
    239. 239. Vision/Mission
    240. 240. Core Values/Ideals</li></ul>DISADVANTAGES (-)<br /><ul><li> Cost
    241. 241. Harmful Effect
    242. 242. Threat
    243. 243. Risk/Penalty</li></ul>Competitors/ Environment<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    244. 244. Customer Result-Alignment Model (CRAM)Case of Google Search<br />CUSTOMER<br />Web user/researcher<br />ADVANTAGES (+)<br /><ul><li>Fast service; time saving
    245. 245. Increase in productivity
    246. 246. Free service
    247. 247. Greater expertise</li></ul>Value Quotient (VQ) = Advantages/Disadvantages<br />chooses/’hires’<br />WANTS (on demand)<br />obtains<br />that provides<br />OBJECT (Interface)<br />Uncluttered list of relevant and ordered search results in response to query<br />TOOL<br />Google Search<br />RESULT/OUTPUT<br /><ul><li>High quality information
    248. 248. Fast answer to query
    249. 249. Deeper knowledge
    250. 250. (Real-time) News</li></ul>that provides<br />THAT YIELDS<br />that provides<br />enables<br />obtains<br />DRIVING FORCE<br /><ul><li> Tangibles: Profit
    251. 251. Intangibles: Culture
    252. 252. Vision/Mission
    253. 253. Core Values/Ideals</li></ul>DISADVANTAGES (-)<br /><ul><li>Results cannot be easily saved on hard disk
    254. 254. Limited interactivity with search results </li></ul>Competitors/ Environment<br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />
    255. 255. Space-Time Template for the Evolution of a System<br />For Facilitating the Making of Scenarios (for Value Quotient of Business/Product) in Space and Time<br />Environment (Supersystem) <br />SPACE <br />PRESENT SYSTEM:<br />System <br />Elements <br />INITIAL ELEMENT<br />(“SEED”) <br />Past <br />Present <br />Future <br />TIME <br />Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net &http://businessmodels.ning.com & http://twitter.com/RodKuhnKing<br />BOBM8. Blue Ocean-Business Models. Copyright 2009. Dr. Rod King. rodkuhnking@sbcglobal.net & http://businessmodels.ning.com<br />
    256. 256. REFERENCES<br />Battelle, J. (2005) The Search. New York: Portfolio. <br />Chesbrough, H. (2006) Open Business Models. Boston: Harvard Business School (HBS) Press. <br />Christensen, C.; Raynor, M.E. (2003) The Innovator’s Solution. Boston: Harvard Business School (HBS) Press.<br />Jarvis, J. (2009) What Would Google Do?. New York: HarperCollins.<br />Kim, W.C.; Mauborgne, R. (2005) Blue Ocean Strategy. Boston: Harvard Business School (HBS) Press.<br />King, R. (2009) The Zoomable Page for Innovative Thinking in Space and Time:How Geniuses<br /> and World-class Innovators Really Think … And How Anyone Can Do So in 1 Minute or Less.<br /> Fresno: Value Quotient Management.<br />Shuen, A. (2008) Web 2.0. California: O’Reilly.<br />Dr. Rod King<br /> <br />Speaker, Consultant, and Trainer on Business Model Analysis, Design, and Innovation<br />rodkuhnking@sbcglobal.net & http://businessmodels.ning.com<br />http://twitter.com/RodKuhnKing<br />

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