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This document presents a short but comprehensive case study on implementing a Blue Ocean Strategy and Business Model for the BlackBerry Smartphone. The case study could be used to guide the development of a Blue Ocean Strategy and Business Model for your product.
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BLUE OCEAN‐PERFORMANCE DASHBOARD
FOR RIM’S BLACKBERRY
Dr. Rod King
Consultant & Trainer on Business Model Analysis, Design, and Innovation
[email protected] & http://businessmodels.ning.com
General Information on the Tool of BLUE OCEAN DASHBOARD
WHAT?
The Blue Ocean Dashboard is a tool that seamlessly integrates the three most powerful tools for business management: Value (Supply) Chain; Blue Ocean Strategy; Balanced Scorecard
WHO?
• Business executives; managers
• Business planners; strategic planners
• Small, medium, and large enterprises
• Practitioners of Blue Ocean Strategy
• Practitioners of Balanced Scorecard
WHERE?
• Online: http://businessmodels.ning.com
• Talks; Seminars
• Workshops; Training
• Consulting
WHY?
• ‘One‐Page Business Management’
• Faster; Simpler; Free; Holistic
• Integrated approach to managing value (supply) chain, strategy, performance, and business model
BLUE OCEAN DASHBOARD: A Faster and More Profitable Way to
Manage Strategies and Business Models
WHEN?
• Starting a business (from idea stage)
• Generating more revenue
• Further reducing cost
• Facing competition in the ‘Red Ocean’
• For uncontested customer experience
HOW?
• “Where currently are you (in the industry?)”
• “Where do you want to go?”
• “How will you get to the Blue Ocean? What strategy and business model?”
HOW MUCH?
• Free online (open innovation): http://businessmodels.ning.com
• Otherwise, contact Dr. Rod King: [email protected]
WHAT NEXT?
• iPhone application for the Blue Ocean‐Performance Dashboard
• Software/social network for Blue Ocean‐Performance Dashboard
• Partners for Collaborative Projects
BOBM8B. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com
Company Overview of RESEARCH IN MOTION (RIM) – BlackBerry Date: April 3, 2009
Author(s): Dr. Rod King ([email protected]) Ref.: …………………………………..…………………….
COMPANY BACKGROUND
• Location: Waterloo, Canada
• Founder(s): Mike Lazaridis; Doug Fregin
• Revenue: US$3.04 billion (2007)
• No. of Direct Competitors:
BUSINESS/INDUSTRY
• Industry: Telecommunication
• Niche: Personal/Wireless/Cell phone/ Smartphone
• Model: Business to Consumer (B2C); Business to Business (B2B)
PRODUCTS/SERVICES
• Cell phone: BlackBerry Smartphone
CUSTOMER VALUE PROPOSITION
• Secure cell phone for corporations
• Secure company e‐mail that can be accessed anywhere and at any time
• Wearable, unobtrusive, real time, 24x7, and low cost “pager” (laptop)
CUSTOMER BENEFITS/EXPERIENCE
• Simpler user interface /Easy to use
• Secure e‐mail access everywhere
• High reliability/Long battery life
• Web browsing capability
• Savings in training and support costs
COMPANY OVERVIEW OF:
RESEARCH IN MOTION (RIM) –
BlackBerry
MAIN GOAL/OBJECTIVE/STRATEGY
Blue Ocean Strategy: to provide a highly desirable and uncontested customer experience while making the competition irrelevant
VISION
• “Connect to everything you love in life”
• “Ideal solution for productivity and profitability”
MISSION
BOBM8A. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com
Blue Ocean Map for RESEARCH IN MOTION’S BlackBerry (vs. Pagers): Strategic Journey to the Blue Ocean
Lowly differentiated and low-cost business model
(+): DELIGHT
Revenu
e
Blue
Ocean
Strategy
BLUE OCEAN Experience: BlackBerry Smartphone
Fractal Market Segmentation of Personal Telecommunication Tools IDEAL BLUE OCEAN (FINAL RESULT)
(‐): PAIN
RED OCEAN Experience: Pagers
Strategic Choice Red Ocean Strategy
(Uncontested Market Space or New Category) No. of Competitors
∞
Cell phones/PDAs/ Smartphones
BOBM1.1. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com
Blue Ocean Dashboard for RESEARCH IN MOTION (RIM) Date: April 3, 2009
Name of Product/Service/Facility: BlackBerry Functionality: Cell phone/PDA/“Pager”/Smartphone
Customer Value Proposition: Secure e‐mail access everywhere 24x7 Business/Industry: Telecommunication: Personal
Goal/Objective: To create an uncontested customer experience and uncontested business model as well as make the competition irrelevant
BUSINESS SYSTEM (“SEMPORCE”) RELATIONSHIPS
Description of Best Current/ Future Resources
Performance Objectives: 2007 Blue Ocean Actions (Relative to Industry Standard) Initiatives/ Projects Cost: ‐
($) Revenue: + ($)
Other Criteria
Raise (+)
Create (+)
Reduce (‐)
Eliminate (‐)
Other
S: Suppliers/Materials Defects Bargaining power
Defects
E: Employees/Know‐ledge Assets/Culture
ProductivityInnovation
No. of filed patents/IP
TrainingR & D
AbsenteeismWaste
TurnoverDelays
M: Machinery, etc. Defects Defects
P: Processes/Activities Quality; ROI Revenue Customers Cost Defects (Six Sigma)
O: Outputs ‐ Product
BlackBerry Smartphone Sale of product
Customer Experience Quotient (EQ)
Reliability Integration Battery life
Ease of useSecurity Folders
Training timeSupport cost Defects
ComplexityInstallation time
(Blue Ocean Strategy/ Innovation)
‐ Service E‐mail client software Subscription Service EQ
R: Retailers/Channels BlackBerry Smartphone Sale of product Channel EQ
C: Customers/ Consumers
Corporate workers/ Enterprise/Gov.
Sale of product
Customer EQ & Retention
Bargaining power
Exit/Entrybarriers
E: Environment Env. quality
‐ Competitors Nokia/Apple/Palm/ Treo/Motorola
Market share Exit/Entry barriers
Entry/Exitbarriers
Bargaining power; Risks
Threat of substitutes
(Competitive Strategy)
‐ Non‐customers Users of pagers/ budget cell phones
No. of prospects
Entry barriers
‐ Partners Nokia/Motorola/HTC Software developers
Software license
Partner EQJoint ventures
Alliances
‐ Investors Share price
‐ Community/Gov. No. of Projects (Local)
BUSINESS MODEL: RIM – BlackBerry (How does the organization work to deliver its value proposition to customers and investors?)
US$3.07b Business Experience Quotient
IDEAL BLUE OCEAN STRATEGY (How to create an uncontested customer experience and uncontested business model as well as make the competition irrelevant?)
Blue Ocean Program
ROI (%):
BOBM5.1. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com
Checklist on 4 Perspectives and Questions for Balancing a Blue Ocean Dashboard
INVESTOR PERSPECTIVE
• How will the business make more money (extraordinary profit)?
EMPLOYEE PERSPECTIVE
• What attributes, skills, resources, and outputs should employees have in order to sustain a workflow and culture that deliver extraordinary value to customers and investors?
4 PERSPECTIVES AND
QUESTIONS FOR BALANCING A BLUE OCEAN DASHBOARD
CUSTOMER PERSPECTIVE
• How will customers experience the greatest delight and least pain?
PROCESS PERSPECTIVE
• What processes and strategies will generate extraordinary profit as well as deliver the organization’s value proposition to customers/consumers?
BOBM6.1. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com BOBM5.3. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com BOBM5.3. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com BOBM8.2. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com BOBM5.3. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com BOBM5.32. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com
TOMCAT (Trade‐Off) Matrix: Categories of trade‐offs that are resolved by RIM’s BlackBerry/Opportunities for Blue Ocean Products
Customer’s Intent/Job: To securely access e‐mails at all times (Non‐)Customers/Industry: Telecommunication: Personal
Focus of (Non‐)Customer: Product/Service/Facility; Purchase/Delivery/Usage/Supplements/Maintenance/Disposal
Breakthrough Question: HOW TO MAKE (THE PRODUCT/ENTERPRISE/INDUSTRY OF) PAGERS IRRELEVANT?
(Non‐)Customer Needs (‐) 1 2 3 4 5 6 7 8 9 10 (+)
Reduce/Eliminate (Relative to Industry Standard) Raise/Create
Cost Mainten‐ance/ Upgrade
Time (Delivery/ Aging)
Defects/ Complaints/ Waste
Weight/ Size/ Tool
Effort/ Friction/ Energy
Staff Depend‐ency
Complexity/ Information Overload
Rigidity/ Inaccess‐ibility
Pain/ Barriers/ Pollution
1 Value/Functionality BlackBerry BlackBerry BlackBerry2 Quality/Automation 3 Performance/Productivity BlackBerry BlackBerry4 Differentiation/Novelty/… 5 Speed/Agility 6 Aesthetics/Visual Appeal/Color 7 Ease of Use/Simplicity BlackBerry8 Convenience of Use BlackBerry9 Customer Service/Support BlackBerry10 Fun/Entertainment/Adventure 11 Star Performers/Celebrities 12 Prestige/Legacy/Amenities 13 Wide Choice/Versatility 14 Hygiene/Cleanliness 15 Integration/Connectivity BlackBerry16 Power/Strength/Wisdom 17 Accuracy/Reliability BlackBerry18 Security/Safety/Health BlackBerry19 Collaboration/Communication 20 Customization/Personalization
Eliminated trade‐off (other trade‐offs are partially resolved and therefore present opportunities for innovation)
BOBM7. Blue Ocean‐Business Models. Copyright 2009. Dr. Rod King. [email protected] & http://businessmodels.ning.com
REFERENCES
1. King, R. (2009) The Infinitely Zoomable Page: The Ideal Tool for Blue Ocean Thinking, Design, and Innovation. Fresno: Ideal‐Solution Management.
2. Ross, E.; Holland, A. (2006) 100 Great Businesses and the Minds Behind Them. Illinois: Sourcebooks, Inc.
3. Von Briesen, J. RIM’s Blackberry. http://frontierstrategy.com/BlueOceanStrategy_RIMExample.html
Consultant & Trainer on Business Model Analysis, Design, and Innovation
[email protected] & http://businessmodels.ning.com
Dr. Rod King
