Blue Ocean Strategy Example in Asia - Example 1

One of the major changes that the airline industry have changed is the inclusion of aviation budget. Good example in Malaysia is Air Asia.

Air Asia has managed to avoid the red sea (in competition with Malaysia Airlines and regional airline like Tiger Air, Jet Air, etc.), look at the factors that are granted by the industry, and that the important factors to customers. With the four activities of the framework proposed by the Blue Ocean StrategyAuthors, Air Asia has many strategic step to ensure that they are doing, Malaysia Airlines and regional airline irrelevant implemented.

Example of a strategic step as follows:

Delete:

* Over the counter booking

* Free Food / Beverage Air

* Class seat reservation

: Reduce

* "Luxury" facilities provided by the airport lounge

* N. Ground Services

* Seat Quality

Raise:

* Concentrate on the main differentTarget

* Increase the frequency of flights

Make:

* Online Booking System

* Point to point travel system

With this strategic move, Air Asia is able to focus on the factors that actually bring value to customers, such as point-to-point travel system, easy reservation system, etc. This will help Air Asia, reduce costs and at the same time, increase the value for customers - Value Innovation.

In addition, Air Asia is not in a position to seek current customers, as already The authors of Blue Ocean Strategy.

Current airline customers:

* Customers who are cheap to buy the expensive tickets from Malaysia Airlines and regional airlines.

* Entrepreneurs in Malaysia and the ASEAN Region

Non-customers:

* Government Personnel

* Those who can not afford to buy expensive tickets, as found in rural areas, students or graduates.

With the success of the Blue> Ocean who dare to Air Asia, in other businesses such as hotels and Tune Tune Money. The concept is in the direction of Blue Ocean market.

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Blue Ocean Strategy Term - Pioneer-Migrator-Settler (PMS) Map

Pioneer-Migrator-Settler (PMS) Map - Blue Ocean Strategy Glossary

Pioneer-Migrator-Settler (PMS) Map is both a diagnostic and planning tool that helps managers assess and plan their future growth at the portfolio level. The PMS Map is a 3-by-2 matrix where each row represents a business category - pioneers, migrators and settlers. With respect to the two columns, the first represents the business situation today, while the second column represents the business situation in the future. Managers can use the PMS Map to plot either businesses in their portfolio, or the products/services they offer.

Pioneers are businesses or products/services that offer unprecedented value to buyers. Their value curve radically diverges from the competition, and they have a mass following of customers. These businesses are Blue Ocean Strategies; they are the most powerful sources of profitable growth.

Migrators are businesses or products/services that offer improved value over competition, but not innovative value: they give customers more for less, but do not radically change the key factors of competition of their industry.

Settlers are businesses or products/services that offer more or less the same value to buyers as the rest of the industry. These are me-too businesses. Although they are often today's cash cows, settlers will not generally contribute much to a company's future growth because they are stuck within the red ocean of competition.

To assess a company's profitable growth prospects, a company should plot each business or product/service as a circle on the map according to the criteria above.

The size of each dot should reflect the amount of revenue earned from each business or product/service. Hence a business with relatively large revenues would be plotted as a large circle on the map; a business with smaller relative revenues should be plotted as a small circle.

Source: Business Strategy Terms, Blue Ocean Strategy Glossary at Blueoceanstrategy.com

Blue Ocean Strategy Term - Noncustomers

Noncustomers - Blue Ocean Strategy Glossary

Noncustomers are customer groups who are either not served by the current industry's offering, or in the case of first-tier noncustomers, are existing customers who are about to turn away from the current industry's offering. Noncustomers can be grouped into three categories:
1. First-tier noncustomers are soon-to-be noncustomers: they use the current industry offering minimally, while searching for better options. They are waiting to jump ship and will leave this market as soon as the opportunity presents itself.

2. Second-tier noncustomers refuse the industry's offerings. These are buyers who have seen what the current industry has to offer as an option to fulfill their needs but have chosen against them.

3. Third-tier noncustomers have never thought of the current industry's offerings as an option. As such, they do not feel concerned by its offering. They are the farthest from the current market.

Often, companies focus on their existing customers and ignore noncustomers. They believe that their needs are too different from what they can offer or that they belong to other industries. To unlock untapped demand, managers must look outside of their typical customer base. By expanding their worldview beyond their current customers, they can reach beyond existing demand and unlock a new mass of customers that did not exist before.

Source: Business Strategy Terms, Blue Ocean Strategy Glossary at Blueoceanstrategy.com