The content for this week focused around strategy. The timing of this topic is clearly to coincide with the development of our strategies for Mike's Bikes that we have all begun to implement this week. Our group has a vague idea of our strategy but I realised on reading the Kim & Mauborgne (2002) reading on graphically representing strategy that it is much more difficult to get it down on paper. I don't think our group has as clear of an idea of our strategy as we thought we did, so we may need to get our strategy down on paper before we continue. The other readings, though, were very difficult to relate to my experience with developing a strategy for Mike's Bikes. The Kim & Mauborgne (2004) article on blue ocean strategy, for example, is difficult to practically apply to Mike's Bikes. Although we can create a strategy that goes into a unique segment and targets them with a unique strategy, all businesses in Mike's Bikes are bound by the same rules so creating a true blue ocean environment seems impossible. Any competitor can target any segment and they can easily imitate any other competitor's strategy. Peter's lecture and strategy theory I have learned from other courses have similar recommendations for strategy in that they must be unique and difficult to imitate in order to be effective. This has created some difficulty for me in trying to imagine an ideal strategy when I know whatever strategy our group chooses can just as easily be used by any one of our competitors.
My initial thought on this issue was that Mike's Bikes was not a perfect simulation and that it had to have limitations on what our teams could do. However, thinking about my past experience dealing with a real company for a group assignment I think these limitations are not entirely unrealistic. Last semester I did a project for Localist in which we had to develop a marketing strategy for the struggling company. As soon as we began the assignment it was clear Localist's business model was flawed, and failed the narrative test Magretta (2002) described and perhaps the numbers test too. Ideally, according to the strategy theory, we would make Localist's business model realistic and move the business towards an area of the market with few competitors. However, the Localist management were insistent upon their business model and the focus of their business put them squarely within a red ocean with little room to move. The course content presents an ideal situation, but in real life, we may not have the opportunity to immediately achieve this ideal state. This is a similar issue we face with Mike's Bikes. Therefore our strategy for Mike's Bikes should not be focused on immediately achieving the ideal situation, as we are not likely to find ourselves in an empty segment, but rather to strive to find the areas where the ideal situation could potentially develop. This seems to be a more realistic mindset to take than the mindset I developed from studying purely idealistic strategy theory at university.
Kim, W. C. & Mauborgne, R. (2002). Charting your company¿s future. Harvard Business Review, 80(6), 76--83
Kim, W. C. & Mauborgne, R. (2004). Blue ocean strategy. Harvard Business Review, 82(10), 75--84
Magretta, J. (2002). Why business models matter. Harvard Business Review, 80(5), 86--92