Week 2

Page 1: Problem Statement

• External Environmental Pressures

  • Increased competition from caterers and manufacturers

  • Manpower crunch impacting operations

  • Rising costs of supplies and other factors

• Impact on Business

  • Declining market share affecting growth

  • Decrease in revenue and profit margins

  • Dilemma: Unable to automate processes due to volume constraints

• Need to Transform

  • Urgent shift to adapt to changing market conditions

Page 2: Where To Transform

The Explore-Exploit Continuum

• Exploit

  • Focused on improving existing business models for immediate gains

• Transformative Innovation

  • Most challenging form of innovation

  • Explores opportunities beyond traditional scope

  • Requires significant changes to business models

  • Advantages: Positions company long-term, protects against disruption

  • Disadvantages: High risk with uncertain returns

• Sustaining Innovation

  • Enhances current business models to maintain competitiveness

  • Examples: New products, services, and geographic expansions

  • Advantages: Lower risk, predictable impacts

  • Disadvantages: Does not shield from future disruptions

• Efficiency Innovation

  • Focused on improving operational efficiency of existing models

  • Advantages: Immediate impacts with lower uncertainty

  • Disadvantages: Limited protection from future disruptions

Page 3: Business/Product Life-Cycle

• Life-Cycle Stages

  1. Introduction

  2. Growth

  3. Maturity

  4. Decline

• Relevance of Exploit-Explore Options

  • Balance between exploiting current business and exploring new growth areas

  • Illustration of profit fluctuations across various stages

Blue Ocean Strategy Framework

• Framework aims at transforming competitive landscape

• Guides companies towards creating untapped markets

Page 7: Success Factors in Business

• A-B-C-D-E Framework

  • External factors impact success

  • Design and capabilities within the company influence destiny

Page 8: Red Ocean vs Blue Ocean

• Red Ocean

  • Competing in Existing Markets

  • Current strategies involve maximizing existing demand

  • Operate within current value/cost tradeoff

• Blue Ocean

  • Creating Uncontested Market Space

  • Unlock new demand

  • Break the value/cost trade offs

Page 9: Characteristics of Blue Ocean**

Create new markets

Involves:

• Value Innovation: Major leap in buyer value

  • Attracting new customer segments

  • Solving unmet needs in ways existing solutions cannot

  • As a result, Changing market boundaries

Market is uncontested

• Emergence of new markets make competitors irrelavent because product/service exists in a distinct value space

• Breaks the traditional industry rule of only having one competitive strategy

Break value/cost trade-off

• achieves :

  • Higher customer value and lower operational costs simultaneously

  • The entire system of the company's activities is aligned to achieve innovation.

  • The whole system of the firm’s activities has been aligned to achieve the above outcome, i.e. innovation on the company

Page 10: Market Competing vs. Creating**

• Distinction between traditional competitive strategies and blue ocean strategies

• New value-cost frontiers emerge from encompassing differentiation and low cost

Page 23: Identifying Blue Ocean Opportunities**

• Process Overview

  • Utilize relevant trends and ERRC framework to identify opportunities

Pages 24-34: 4 Actions Framework (ERRC)**

• Components:

  1. Eliminate: Identify industry assumptions to discard

  2. Reduce: What factors can be minimized below industry standards to cut costs or simplify process?

  3. Raise: What factors can be intensified for greater value?

  4. Create: What new elements can be offered?

Pages 35-39: Examples Applied to Industries**

• Practical applications of ERRC in various sectors

  • Focused on waste reduction and value enhancement

  • Innovative techniques observed in traditional markets

Pages 40-48: KCK Food Catering Application**

• Step-by-step process for applying insights from blue ocean strategies to KCK

  • Framework to follow includes brainstorming trends and using the ERRC model accordingly.