Chapter 9: Align Value, Profit, and people Propositions Team 6: Andrew Platter, Brice Freedle, Charles Nell, and Collin Voyles

Introduction Asking people to define what blue ocean strategy is: How to reconstruct market boundaries and offer a leap in value to buyers Unlocking business model innovation through strategic pricing, target costing, and in turn gain new customers Releasing the creativity, knowledge sharing, and voluntary cooperation of people through the proper approach to employees and partners

Alignment Closing the loop between creating and capturing blue oceans so that it becomes a high-performing and sustainable strategy

The Three Strategy Propositions Value Proposition Develop an offering that attracts buyers Profit Proposition Create a business model that enables the company to make money People Proposition Motivate the people working for or with the company

Achieving Blue Ocean Strategic Alignment Comic Relief •Achieved 96 percent national brand awareness •100 percent public donations with no paid marketing •Created a sustainable high-performing blue ocean strategy by: 1. Value Proposition: Customers are donors 2. Profit Proposition: Business model 3. People Proposition: Positive motivational incentives for employees, volunteers, corporate partners, and celebrities *Aligning the three strategy propositions around differentiation AND  low cost creates a positive cycle and shields the strategy from imitators. 

The value proposition Comic Relief •Customers are donors, how can we attract more? •“Red Nose Day” makes fund-raising, “fun”-raising •Value even the smallest donations •Donating is personal with community fund-raising •Reduced donor fatigue by running charity every 2 years •“Golden Pound” Promise Result: Value proposition that is differentiated and low-cost. Donating is affordable for everyone regardless of age or income and even the smallest contribution makes a difference.

The value proposition "Value proposition refers to a business or marketing statement that a company uses to summarize why a consumer should buy a product or use a service." (Investopedia) "One only needs two tools in life: WD-40 to make things go, and duct tape to make them stop." -G. Weilacher

The Profit Proposition Big galas Asking for large sums from wealthy folks High overhead costs due to rental fees and service fees Making more of the fundraiser than the cause

Comic Relief Small donations from large number All services are free as everyone is volunteering  The comedians come support for free to support cause Its about the cause rather than the charity group

People Proposition Ease of access through online registration Making everyone feel included, not just the big contributors or stars Red Nose day allows people to see what they are doing Makes the people who participate feel good about what they are doing to help out Only every other year Free contributions from big corporations and celebrities for free publicity

WHEN A STRATEGY IS NOT PROPERLY ALIGNED Comic Relief Tata Motors The Nano Innovative, and low cost Why Tata motors was not successful implementing there strategy. The Singur community in West Bengal

WD-40 Did WD-40 align its three strategy propositions in pursuit of differentiation and low cost?  Did WD-40 identify all the key stakeholders on which the execution of its blue ocean strategy will depend? Has WD-40 developed compelling people propositions to make sure key stakeholders are in support of their ideas?

PUTTING IT ALL TOGETHER Napster vs. Apple iTunes Why Napster failed? Why Apple Succeded? Do you have a holistic understanding of strategy? Have you aligned the three strategy propositions for success?