Fighting to stay ahead of your competitors and being eaten alive? No need. Instead of trying to match or beat them on cost and quality, make other competitors irrelevant by staking out new market space where competitors haven’t ventured.
How? Convert to a Value Innovator. Recognize radical ideas that make quantum leaps in the value you provide customers.
What is Value Innovation?
Value Innovation is the synchronous pursuit of differentiation and low cost, creating a leap in value for both buyers and the organisation. The concept of Value Innovation is developed by W. Chan Kim and Renée Mauborgne and is the cornerstone of the Blue Ocean market-creating strategy.
Value innovators ask, “What if we started fresh and forgot everything, we know about our industries existing rules and traditions?
Value Innovators don’t set out to build competitive advantage. But their innovative practices lead them to accomplish exactly that. Virgin Atlantic, for example, cut first-class airline service and channelled cost savings into greater value for business class passengers: more comfortable seats and free transportation to and from the airports. It attracted not only business class customers but also full economy fare and first-class passengers of other airlines.
To become a value innovator, consider the following strategies
- Assume that you can shape your Industries conditions
- Focus on what the majority of your buyers’ value
- Consider how you might change your offering to capture the market you have identified
Following these strategies is achieved by following the Blue Ocean shift and will form future blog posts on the subject.
So what is the difference between Conventional logic versus Value innovation?
So let’s jump in to execute a value innovation strategy in the organization. To realise it, you need to think about how to add more value to customer experiences within its consumption sequence. A Value Innovation must demonstrate actual savings and an appreciable benefit that a customer can use immediately.
In the next post on the Blue Ocean strategy, I will be discussing how to identify a starting point for your journey.