This week focused on how to be competitive in the market through utilising strategy and business model. This week topic, therefore, is really important for us to carefully and deeply think about if we want to win in MikesBike. After all MikesBike is all about strategy, and depending on strategy we may increase or decrease the SHV and survive or fail to survive in intense competition .This week reading was very interesting for me and was very helpful in terms of learning new terms, such as blue ocean ().Strategy goes along with our life and we continuously build strategy to lead our self to better life. For an example some people takes strategy to focus on sport only while some other people focuses on education only. We also see some people taking mix these two, which can be described as blue ocean strategy. Therefore we cannot ignore strategy topic. We also builds model in our life (just like business model) in order to produce outcome that we desire. For an example some people may decide to build life model without university and go straight to work environment, just like business model that sells product straight to customers without the involvement of middleman. Hence strategy and business model (life model) does not only apply to business but it also applies to our life, so that¿s why I founded this week topic very interesting.
(Kim & Mauborgne, 2002) outlined four steps for visualising strategy and those are Visual awakening, Visual Exploration, visual strategy Fair and Visual Communication. As I started to read through the explanation of each steps, i.ve learnt and realised something important in visual exploration section. (Kim & MauBorgne) says that we should not outsource the information but send our people to adopt the information and make managers to make sense of it by their own, without relying on other people¿s report. I strongly agree to this point because this is very true and obvious but yet many people fail to do this. I personally think the reason behind why people outsource this process is because of information technology development. Information technology development made information adoption much easier for us, reducing the time consuming (time is money in competitive world) decreasing the understanding of the situation. Therefore, we need to look at long term effect rather the than short term effect, and start investing time on obtaining information and making report. For an example in MikesBike if we only rely on other people¿s information without ever trying it, our own, before the roll over then the result will become chaos. Simply because outsourced information only show us the picture but never explains why, thus, we end not understanding our own strategy
(Kim & Mauborgne, 2004) reading was very interesting reading. This reading introduces Blue ocean strategy. Blue ocean strategy is strategy (combination of low cost and differentiation) that creates new demands and markets therefore make competition irrelevant and break the value (Kim & Mauborgne, 2004). All this time I thought technology innovation was something that mostly creates new market and demand but (Kim & Mauborgne) says it¿s not. From here i.ve learnt that blue ocean doesn¿t exist somewhere far but close to our read ocean. This gave me a smile on my face because I was worrying with the fact that I didn¿t know anything about the technology that will create new market. After reading this, i.ve gained confident that I can also create something new by only using pure business skill (blue ocean strategy) and not technology. This also made me realise how simple is human desire is, rather something complex that needs whole new strategy.
¿A Business model isn¿t the same thing as a strategy, even though many people use the terms interchangeably today¿ (Magretta, 2002, p91). Then is this mean there is no relationship between business model and strategy? And my answer to this is NO. As (Magretta, 2002, p91) have said, business model is not same as a strategy but they have positive relationship. I strongly think strategy is the leader and business model is an effective follower. When decision for which strategy to take is made the business model will be adjusted according to the chosen strategy. For an example when we choose strategy of cost leadership we will build business model that will give us capability to produce in low cost. Such as taking the middle man out, therefore decrease in cost, or outsourcing some of the operations to the overseas which will decrease the cost as well.
I really do hope that our team successfully chose the right strategy and build the right business model to success in MikesBike
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