This week hailed the start of the real MikesBikes competition and after Monday¿s class it became apparent that no one wanted to say anything as they kept their cards close to their chest. After Monday¿s class my team¿s approach to MikesBikes was relatively unchanged and became apparent in our Wednesday meeting where we discussed what we wanted to do. We decided that we wanted to pursue the same strategy as the previous two weeks with a few minor changes based on what we learnt during the practice weeks. Our strategy seems to have paid off (for this week at least) as after the roll over we found ourselves in a very favorable position and one that we hope to capitalize on in the future weeks.
This week¿s reading made me as a member think about strategy in terms of not only MikesBikes but also as we move out into the working world and possibly start our own companies. Magretta, (2002) discusses why the business model is so important and how a successful model in one part of the world will not necessarily work as well in another; she uses the Disney Theme parks to highlight this. Magretta also talks about ¿the narrative and numbers test¿ and how they are often critical to a successful model.
Kim and Mauborgne, (2004) reading on blue and red oceans interested me the most. It interested me the most because of the way in which it can be applied to MikesBikes and the real business world in a bid for success. Although it is talked up as a winning strategy, it needs to be taken with a pinch of salt in my opinion. Although moving into an untapped market does suggest that profits will and potential be unlimited there are also a lot of risks associated with doing so; there is no guarantee that the product will sell and that demand will be as high as expected. For these reasons it is therefore much easier for companies to follow a red ocean strategy and follow those who have gone before and simply move into a market where others have already been successful.
In terms of MikesBikes a blue ocean strategy as such in its truest sense is hard to undertake as all of the bikes are laid out for us in a perceptual map, although it is possible to enter a segment of the market that no other team is in. It also makes sense to do this than trying to compete with other teams in the world in the center of the perceptual maps so teams will just end up losing sales. I therefore think that a blue ocean type strategy will be more profitable in MikesBikes then a red ocean one.
Moving forward with MikesBikes and our team strategy I think that we will need to watch what other teams are doing and based off this, plan our strategy around there¿s so we can try and maximize our sales, profit and ultimately capitalization.
As I move into the world of full time employment I feel as though it is important to remember that strategy is vital to an organization¿s success and that a solid business model is often the foundation of this. Therefore it is important to make sure that your organization has a business model that is functional and passes the narrative and numbers tests.
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