Analyze Industry/Environmental Conditions 2. Asses Strengths and Weakness of others Conduct 1.STRUCTURALIST APPROACH Structure 1. Differentiate using premium price or low costs Performance Align Value Chain . Create distinctive strategic position to outperform their rivals 2.

WHEN DOES STRUCTURALIST APPROACH WORKS • Environmental Forces are favorable • Resources and capabilities are strong to carve a competitive position – works even for unattractive industry position • Firms defending current strategic positions and reluctance to strategic shift • Fails when existing players are well entrenched and incompetent resources and capabilities .

and knowledge are significant contributors to economic growth • Strategy can shape structure .RECONSTRUCTIONIST THEORY • Endogenous Growth • human capital. innovation.

RECONSTRUCTIONIST THEORY-ARCHITECTURE Deliver high and sustainable performance How to? Align Organizational activities with this strategy Choose the Right Strategy Analyze Challenges faced by Organization .

FACTORS FOR RIGHT STRATEGIC APPROACH 3 Factor s Resources and Capabilitie s .

RECONSTRUCTIONIST THEORY-WHO AND WHY • Innovative Bent of Mind • Grab Future Opportunities • Situations in which Structuralist Approach fails .

3 STRATEGY PROPOSITIONS 3 Propositions Profit Proposition Attracts Buyers Helps company make money Employees to execute the strategy .

Formulation failure . Outputs: Value for the Buyer Revenue for itself l.STRATEGY AND ITS FAILURE Inputs: Cost of production People/ Employees Complete Strategic alignment of all 3 propositions. Execution failure II.

REVISITING ALIGNMENT FOR 2 APPROACHES Propositions aligned around differentiation or cost Structural Approach Propositions aligned around differentiation and cost Reconstructionst Approach .

World Class logistics services Low Cost 1. Zero corporate tax rate for first 15-50 years of operations 3. Quick and easy registration and licensing process 4. 100% foreign ownership 2. Free repatriation of capital and profits 3. World class free zones with unbeatable incentives for investors .DUBAI: IMPLEMENTATION OF BLUE OCEAN STRATEGY ALIGNMENT Value Proposition Differentiation 1. No import or re-export duties 2.

Restrict citizenship to foreign nationals 3. . Almost no cost to maintain federal govt. Govt. DP World operates in 50ports in 31 countries Low Cost 1. tourism. Profit from high volume of business travellers and cargo flowing in 3. invests in infrastructure that supports investors activitiestransport. 2. to make profit from housing needs of foreign employees 2.DUBAI: IMPLEMENTATION OF BLUE OCEAN STRATEGY ALIGNMENT Profit Proposition Differentiation 1. Govt. aviation etc.

Zero income tax for expatriates 2. Citizens have access to social security system – govt. Housing at cheap rates 3. Allow foreigners to own properties outright 4.DUBAI: IMPLEMENTATION OF BLUE OCEAN STRATEGY ALIGNMENT People Proposition Differentiation 1. Multicultural environment Low Cost 1. job and state assistance 2. Real estate at cheap rates . Preserve Dubai’s culture and heritage 3.

Studios and Stars donate services • Red Nose Night doesn’t cost a penny • No ad costs • Makes grants to other charities People Proposition • Motivated staff members • Public.SUCCESSFUL ALIGNMENT Value Proposition • Red Nose Day • Even smallest donation is recognized • Make a difference with low cost Profit Proposition • Network. corporate sponsors and celebrities • Make the world a better place while having fun .

search and share music files Profit Propositio n People Proposition • Fights Record Labels • Loses people proposition ? .EXAMPLE: FAILURE TO IMPLEMENT BLUE OCEAN STRATEGY Value Proposition Simple and easy software to index.

EMI. UMG. search and share music files Profit Proposition • Individual song 99cents • Album $9.ITUNES SUCCESS: CORRECT STRATEGY ALIGNMENT Value Proposition Simple and easy software to index. WB • Pay 65cents for every song downloaded . Sony.99 People Proposition • Support from BMG.

CONCLUSION • Strategic Alignment is equally important as Innovation • A good trade-off between the two strategies and its correct alignment should be done to deal with diverse and changing structural and business conditions .

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