Blue Ocean Strategy December 8, 2006
Posted by The Probabilist in : [Books], Business, Creativity, Entrepreneurship, Goals, Innovation, Productivity, Vision, Leadership , 4 comments
W. Chan Kim & Renée Mauborgne’s book Blue Ocean Strategy is today’s top bestseller in the area of business strategy. In its first year since the date of publishing it has reached over a million copies sold in 34 languages. This book is the result of a decade-long study of 150 strategic moves spanning more than 30 industries over 100 years. Its tagline can be described as follows. Why compete in the bloody red waters of existing shark-infested oceans when you can create blue oceans of uncontested market space where competition is irrelevant?
Blue Ocean Strategy covers both the formulation as well as execution of its strategy and does it with numerous frameworks that illustrate a company’s strategic ventures in easy to grasp terms that make sense both in detail and in a big picture perspective. These models include the four actions framework, strategy canvas/value curve, six paths, buyer experience cycle & utility map and blue ocean idea index. In general terms the three key conceptual building blocks of the BOS are value innovation, tipping point leadership and fair process.
Like many other successful books, this too uses the advantage of showing multiple real life examples of businesses that have and are using principles that are part of the overall Blue Ocean Strategy - the ingredient that catches any reader’s attention and interest. Success stories always hit home, but are nevertheless a result of conscious and demanding planning and action. However, in many cases the pivotal point leading to success was excellence in merely one aspect of the BOS, while no particular example addressed all aspects as a whole.
My point is not to shun the importance of focusing on all the outstanding insights this book offers, but to acknowledge that even some of these strategic changes may have significant positive results in business results. Really excellent companies reach the spotlight of unprecedented growth by leveraging most if not all of the steps a fully integrated Blue Ocean Strategy suggests.
Writing down a summary of the chapters of this book serves no better purpose to grasping how great of a book BOS is or what it encompasses. But for those of you even remotely involved in the corporate world are strongly advised to read this book to discover today’s most cutting edge business strategy. Even if it’s just for the sake of preparing yourself for it once the company you work for starts to seek and swim in its own blue ocean.
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Delayed Gratification December 7, 2006
Posted by The Probabilist in : [Articles], Business, Doodads, Emotions, Financial Literacy, Goals, Responsibility, Wealth, Assets, Investing , 9 comments
The concepts of delayed versus instant gratification are undoubtedly one of the most important choices that separate rich thinking from poor thinking. And it isn’t a choice until you’ve consciously identified it as one. Since it’s too often a matter of unconscious repeating of the pattern that your family or closest friends are instilling in you, it’s very important to think it through for yourself. Does no money down with fixed monthly payments really make more sense to you compared to acquiring assets that pay for what you want? Your answer should address both financial and emotional sensibility.
Financially there’s no doubt about which is a more sound decision. The two alternatives both represent a spiralling result. One is an upward/positive spiral while the other one is a downward/negative spiral. By buying first and paying later the monthly expenses keep building up and it’s increasingly more difficult to set a fixed percentage aside, a.k.a. paying yourself first. Most people don’t even think about this aspect to begin with. So, rather using a portion of any monthly income to invest in assets that add more income, the asset itself can increase in value when invested and maintained properly.
Emotionally delayed gratification also serves a better purpose, since it’s a question of worthiness. When are you worthy of something, before you have the money or when you have the money for it? The answer is simple in logical terms, but since people in general aren’t rational beings the emotional reasoning dwarfs the rationale.
But choosing delayed gratification doesn’t have to mean for you to squash the existence of your emotional expression. In fact, it can be used in advantage to gain the mind-set of delayed gratification. See, sometimes you might have got so accustomed to, lost interest of or completely disposed of something that you’re still paying the bills for and those are the emotionally worst ones to pay for. But in contrast if the money needed to buy something is acquired through hard and smart labor it can serve as a much better outlet of emotional outburst once it’s paid for in cash. It’s simply a smarter way to harness the emotional side of wanting something.
The rich always think in terms of delayed gratification. It doesn’t matter if it’s about creating a business, investing in real estate or simply desiring another doodad, to name a few examples. This is the process they all have in common, whatever they put their mind to. Just trying to answer the question of how you can afford something doesn’t mean any answer is the right answer, as with the case of typical jargon like “low down, easy monthly payments.” That’s the middle class trap. Looking good and going nowhere has never been my path in life. Which one is yours?
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