B2B - Strategy Tools - Part 11

Blue Ocean Strategy

This post and some of the coming posts are inspired by and will use some of the key tools from Kim & Mauborgne's break-through book: " Blue Ocean Strategy". However the tools and concepts have been further developed and adapted to the particular challenges faced by Business-to-Business companies.

In my earlier post: "Change the name of the game" I described how Business-to-Business companies faced with direct competition change the name of the game by developing more and more unique solutions.

"Blue Ocean Strategy" is about changing the name of the game by developing unique solutions - innovations - that at the same time create added value for your customers and reduce procurement costs in your company.

Kim & Maubourgne call it: "Value Innovation".


In my previous post:" Strategies for different customer segments" I described how you could end up with strategies like: Go, Keep, Investigate or Drop for your various customer segments.

As regards "changing the name of the game" you may want to start in the "Investigate" segment that you find attractive but where your competive strength is poor or maybe even in the "Drop" segment where both segment attractiveness and your strength are poor.

You should start by drawing up the current strategic profile of the customer segment in question. A customer segment may comprise customers from different industries but they share the same important needs that you to a greater or lesser extent are able to fulfil.

1. List the customer segments core needs that are presently being fulfilled by you or your competitors and list the core needs in order of importance.
2. For each of the core needs list the degree to which you and your major competitors fulfill these needs at the customers in the segment

Based on the current strategic profile of the customer segment in question you may ask the following questions:

• Are the important customer needs being fulfilled to create maximum value to the customers?
• Are some needs of lesser importance being fulfilled while creating excessive procurement costs for you?
• Are there important customer needs not currently being fulfilled by neither you nor your competitors?

PETER SØRENSEN