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BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
innovation.uccs.edu
Accolades
JOHN ABBOTT
Prof Renee
Mauborgne
innovation.uccs.edu
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
innovation.uccs.edu
11/4/2015
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
innovation.uccs.edu
BACHELOR OF
INNOVATION
Red oceans
Industry boundaries defined and accepted
Competitive rules of game known
Companies try to outperform rivals; cutthroat competition
As market space gets crowded, prospects for profit and
growth reduced
Products become commodities
Red ocean strategy is a market-competing strategy
Blue oceans
Undefined market space, demand creation, opportunity for
highly profitable growth
Most are created from within red oceans by expanding
existing industry boundaries
Rules of game waiting to be set
Competition irrelevant
Blue ocean strategy is a market-creating strategy
innovation.uccs.edu
innovation.uccs.edu
BACHELOR OF
INNOVATION
innovation.uccs.edu
11/4/2015
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
innovation.uccs.edu
BACHELOR OF
INNOVATION
innovation.uccs.edu
BACHELOR OF
INNOVATION
innovation.uccs.edu
11/4/2015
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
Create uncontested
market space
Make the competition
irrelevant
Create and capture new
demand
Break the value-cost
trade-off
Align the whole system of
a firms activities in
pursuit of differentiation
and low cost
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Take Aways
BACHELOR OF
INNOVATION
innovation.uccs.edu
Formulation Principles
BACHELOR OF
INNOVATION
Search risk
Planning risk
Scale risk
Evaluation principles
Organizational risk
Management risk
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11/4/2015
Points of view
BACHELOR OF
INNOVATION
V1
V1
Quality
Quality
LC
Low
Low
High
C1
Low
BACHELOR OF
INNOVATION
Low
C1
High
Cost
Cost
Structuralist
Reconstructionist
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High
BACHELOR OF
INNOVATION
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BACHELOR OF
INNOVATION
Premium Wines
Budget Wines
Polarised
Strategic Groups
The American
Wine Industry
Massive Choice
innovation.uccs.edu
innovation.uccs.edu
11/4/2015
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
innovation.uccs.edu
BACHELOR OF
INNOVATION
innovation.uccs.edu
11/4/2015
Strategy Canvas
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
Low
Involvement
High
Involvement
Easy Going
Glass with
friends
Least care
choosing a wine
Not wine
preferrers
Price is a strong
influencer
Enjoyers
Aspirationals
Everyday
enjoyment
To relax/unwind
Stick with limited
list of known
brands
Choose in-store
Not interested in
wine language
Image important
Wine preferrers
(sic)
Varietal
knowledge
Interested in
some wine
language
Enjoy trying new
wines
Influenced by
major brand
advertising
Ideal wine is
Visit wineries /
complex &
read wine articles interesting
Brand:
Lindemans
Demographic:
Appreciators
Connoisseurs
Want to
discover wine
Knowledge of
wine regions
Frequently buy
>$10 wines
Join wine clubs
Dont stick to
known brands
Sophisticated
drinker
Discerning wine
tastes
Dont decide in
store
Have a cellar
Less influenced
by specials/
promotions
Actively pursue
wine knowledge
Rosemount
Estate
Wolf Blass
Penfolds
Age: 40+
innovation.uccs.edu
The strategy canvas is both a diagnostic and an action framework for building a
compelling blue ocean strategy. It captures the current state of play in the known
market space. This allows you to understand where the competition is currently
investing, the factors the industry currently competes on in products, service, and
delivery, and what customers receive from the existing competitive offerings on the
market. The horizontal axis captures the range of factors the industry competes on
an invests in. The vertical axis captures the offering level that buyers receive across
all these key competing factors. The value curve then provides a graphic depiction
of a companys relative performance across its industrys factors of competition.
High
Premium Wines
Budget Wines
Low
Price
Use of
enological
terminology
2. Visual
Exploration
3. Visual
Strategy Fair
4. Visual
Communication
Compare your
business with your
competitors by
drawing your as is
canvas
Draw your to be
canvas based on
insights from field
observations
Distribute your
before-and-after
strategic profiles on
one page for easy
comparison
Get feedback on
alternative strategy
canvases from
customers,
competitors
customers, and noncustomers
complexity
innovation.uccs.edu
1. Visual
Awakening
Observe the
distinctive advantages
of alternative products
and services
quality
Wine range
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
Above-the-line
Vineyard prestige
marketing Aging and legacy Wine
Raise
What factors
should be raised
well beyond the
industry standard?
Eliminate
Create
What factors
should be
eliminated that the
industry has taken
for granted?
Reduce
What factors
should be reduced
well below the
industry standard?
innovation.uccs.edu
innovation.uccs.edu
11/4/2015
Eliminate
Raise
Above-the-line marketing
Reduce
Create
Wine complexity
Easy drinking
Wine range
Ease of selection
BACHELOR OF
INNOVATION
Reduce
Eliminate
A
New
Value
Curve
BACHELOR OF
INNOVATION
Create
Eliminate
Raise
Raise
To Be Canvas
BACHELOR OF
INNOVATION
Reduce
Create
Wine complexity
Wine Range
Vineyard prestige
Easy drinking
Ease of selection
Fun & adventure
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Yellow Tail
BACHELOR OF
INNOVATION
Eliminate
Reduce
Raise
Create
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innovation.uccs.edu
11/4/2015
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
Price proposition
Results
Cost structure
BACHELOR OF
INNOVATION
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BACHELOR OF
INNOVATION
http://www.youtube.com/watch?v=M4lAPI5BAuk
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innovation.uccs.edu
11/4/2015
BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
innovation.uccs.edu
Eliminate-Reduce-Raise-Create
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BACHELOR OF
INNOVATION
Star Performers
Animal shows
Raise
Raise
Reduce
Create
Create
Ringling Brothers
Unique venues
Eliminate
hi
Cirque du Soleil
offering level
Eliminate
BACHELOR OF
INNOVATION
Theme
Refined environment
Multiple productions
Artistic music and dance
innovation.uccs.edu
lo
Price
Animal Shows
Star Performers
Multiple Show
Arenas
Aisle Concessions
Theme
Unique Venue
Multiple
Productions
Refined Viewing
Environment
Artistic Music
& Dance
Kim & Mauborgne 2006
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10
11/4/2015
Key Takeaways
BACHELOR OF
INNOVATION
Comparison of approaches
BACHELOR OF
INNOVATION
Exercise
1. List Factors of
Competition
2. Top 2 or 3 in ERRC
Grid Quadrants
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BACHELOR OF
INNOVATION
BACHELOR OF
INNOVATION
Examples
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innovation.uccs.edu
11
11/4/2015
Exercise
3.
Write on
Worksheet:
E left, C right
4.
Draw As Is
5.
Draw To Be
BACHELOR OF
INNOVATION
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Examples
BACHELOR OF
INNOVATION
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12