[15:07:10] --------------------------Paper P3-------------------------- [15:13:35] ysbq: Syllabus reference B-1 (chapter 5 for kaplan) [15:14:17] ysbq: ok let start revising the strategic clock [15:14:24] ysbq: all fine with that [15:14:40] savvy2012: fine [15:14:45] ms1689: did we not do that last week? [15:15:20] savvy2012: we did.. [15:15:40] ysbq: well we have got the concepts lets take a look on some real life examples, if u may [15:15:52] savvy2012: ok [15:15:54] ysbq: regarding the strategic clock [15:15:56] ratna1238: ok [15:16:58] ysbq: okay first of all can any body recall the purpose of strategic clock ? [15:17:52] savvy2012: the added value must be at least the same as the price [15:18:09] ysbq: okay anybody else [15:18:16] savvy2012: if we can't charge more for value we added then theres no point improving product [15:18:18] ratna1238: is reading... never heard of this thing before [15:18:36] savvy2012: {ratna1238} page 62 in lsbf notes [15:18:43] ratna1238: ok [15:18:50] savvy2012: or somwhere there.. [15:18:55] ms1689: {ratna1238} or 127 in kaplan [15:19:14] ratna1238: yeah... got the kaplan [15:20:07] ratna1238: the purpose is to see what the customer wants and to provide it better or even more effectively than its competitors [15:20:09] savvy2012: strategic clock model is often used when external environment quickly changing [15:20:38] ysbq: {savvy2012} {ratna1238} yes [15:20:43] savvy2012: so company can decide on tis strategy - whether to add some features to product and make it more expensive or maybe other way round [15:21:06] ysbq: okay if i say that the purpose is to achieve the competitve advantage by providing the customers what is needed effectively [15:21:32] savvy2012: thats too blury , Lisa wont like it :D [15:21:44] ratna1238: haha [15:21:53] ysbq: the imporatnt aspect is achievement of competitve advantage, i my opinion [15:22:02] ysbq: Lisa ?? [15:22:09] savvy2012: {ysbq} examiner [15:22:22] ysbq: okay fine [15:22:31] ratna1238: well... the purpose is to win in the market... from using this Strategy Clock our outcome would be.... producing products that is Best Value for Money for the customers [15:22:37] savvy2012: yeah its important but we need to specify how exactly i think#otherwise it doesnt make it any different from other models :) [15:22:53] ysbq: ok [15:23:13] savvy2012: i think main purpose it to justify higher price charged [15:23:30] savvy2012: and price charged depends on added value of product [15:23:48] ysbq: {savvy2012} that would be value chain [15:24:01] savvy2012: hmm ok [15:24:11] ysbq: ok lets have an example [15:24:20] ysbq: okay which products are best suited for No-frills .... any suggestions [15:24:35] ysbq: will it be luxury ones? [15:24:45] ms1689: {savvy2012} I agree. If we charge higher prices for a poor quality, customers won't like it and we may lose them to competitors [15:25:10] ysbq: {ms1689} those are strategies that would fail [15:25:14] ysbq: in the clock [15:25:52] ms1689: So, the purpose is to match the added value and the price [15:26:17] ratna1238: for No frills products [15:26:18] ms1689: and the price must not be more than the added value [15:26:22] savvy2012: no frills are basic products, not liuxury [15:26:42] ratna1238: the price must be kept low.. cuz the product n its technology n really easy to immitate [15:26:49] ysbq: {savvy2012} {ratna1238} {ms1689} yes [15:27:11] ysbq: basic commmodities will be no frills [15:27:12] ratna1238: high competitors I presume [15:27:42] ysbq: yes high competiton and less differentiation and lack of any value addition [15:27:47] ratna1238: to compete the business must keep the price low hence keep cost low too [15:27:57] ysbq: yes [15:28:40] ysbq: u know tht one of the major exporter of basic commodities is China because of its low cost production methods [15:29:17] ratna1238: and Pak and India and many other 3rd world countries [15:29:19] ratna1238: :D [15:29:35] cuteleo110: because man power is cheap [15:29:45] ysbq: and customers are very sensitive in this market since they shift to the next best alternative [15:29:56] cuteleo110: and other resources are easliy available [15:30:00] ysbq: {cuteleo110} {ratna1238} yes [15:30:45] ysbq: so cost leader would be best in this industry [15:31:11] ysbq: al agree i am linking wht we studied [15:31:21] ratna1238: ya [15:31:21] ysbq: ? [15:31:26] ms1689: yes [15:31:45] ratna1238: funny how there r only 7 hours in the clock [15:32:04] ysbq: okay lets talk abt the low price products that offer medium benefit and low prices.... [15:32:41] ysbq: any example ? [15:33:11] ms1689: ryanair [15:33:20] ratna1238: primary products like rice [15:33:58] ratna1238: {ms1689} yeah... ryanair vs Jet2 Vs Easyjet [15:33:58] ysbq: {ratna1238} isn't rice is commodity [15:34:09] ratna1238: is it not? [15:34:46] ratna1238: comodity-like product.... hm what is a comodity? [15:35:19] ysbq: {ratna1238} like basic stuff that come from primary sector of indutry [15:35:24] ms1689: {ratna1238} someting that satisfies the basic needs [15:35:55] ysbq: like metals, wheat , rice and agri produce....etc [15:36:08] ysbq: well wht benefit ryanair offers ...... can any one share [15:36:27] ratna1238: ah.. so rice is a commodity too [15:36:34] ysbq: {ratna1238} yes [15:36:35] ms1689: they have low prices, low cost [15:37:01] ysbq: well wht benefit ryanair offers ...... can any one share [15:37:13] ratna1238: cheap flights [15:37:14] savvy2012: it takes u from place to place [15:37:33] ms1689: they don't provide that luxury flights but customers like it beig cheap [15:37:39] ratna1238: flying at odd hours.... sleeping time... competitive price [15:37:55] savvy2012: for low price u can fly if you dont have any baggage its chepaer, whilst other airlines have higher price but allowed to take check in bagage [15:38:00] ratna1238: the seats r cramps so close treating passengers like sardines [15:38:08] ysbq: welll that is a basic benefit nothing above par [15:38:12] ysbq: i guess [15:38:15] savvy2012: but if u want u can add bagage for extra money [15:38:25] ysbq: ok [15:39:46] savvy2012: {ysbq} so.. have u forgotten to put your strategic clock forward? :D [15:40:08] ratna1238: {savvy2012} i dont think he is in Europe [15:40:18] ratna1238: but he must change the strategic setting :D [15:40:19] savvy2012: {ratna1238} he is i think [15:40:31] cuteleo110: it totally depends upon cutomer preferences [15:40:33] savvy2012: yeah because this session is free - its no frills [15:40:40] savvy2012: so we had to wait extra time :D [15:40:45] ratna1238: {savvy2012} hahaha [15:40:50] cuteleo110: either they are price cautios or product [15:41:09] ysbq: lets say if ryanair offers a ticket / package for customers with some extra room for lower limbs that would be low price product [15:41:30] ratna1238: {cuteleo110} yeah... n we r not willing to pay a thing here [15:41:47] savvy2012: so its low price and medium added value [15:41:54] ysbq: yes [15:42:24] ysbq: okay lets talk abt Hybird products [15:42:34] ysbq: any examples other than IKEA [15:43:23] ysbq: ? [15:43:45] ratna1238: hm.... Supermarket chain ASDA, TESCO etc? [15:44:03] ysbq: okay [15:44:25] ysbq: low price products and wide range of offering [15:44:27] ratna1238: they try to achieve high volumes of sales n keep the price low [15:44:49] savvy2012: New spa center being opened and offering spa days for low price, trying to gain market penetration to get known by customers and gain reputation [15:45:08] ysbq: {savvy2012} yeah good one [15:45:34] ysbq: {savvy2012} but that would be a temporary one [15:46:08] ysbq: so how this could be acheived [15:46:11] savvy2012: yeah [15:46:16] ysbq: the hybird stuff [15:46:35] ysbq: link with the capability we studied [15:46:43] ysbq: any one? [15:46:53] savvy2012: ok maybe Amazon... [15:47:35] savvy2012: they are able to charge low price for high added value products because they have economies of scale and they dont have many costs because they are purely online business, so dont have office costs etc [15:47:53] ms1689: Highbrid would be getting above average service for low price [15:48:23] ysbq: yeah uniques resources such as Brand and core competancy such as the web design and support team [15:48:39] ysbq: but offering the service at low price [15:48:42] savvy2012: ok.. my new mobile network is GiffGaff :) [15:48:51] savvy2012: they are low price and high added value. :) [15:48:53] ysbq: what? [15:49:10] savvy2012: for £10 a month u get 250 mins, unlimited texts and unlimited internet [15:49:24] ysbq: hmmm good for u [15:49:33] ms1689: {savvy2012} Same with vigin [15:49:38] savvy2012: they are able to achieve this because most of their stuff is done by comuniti - other ppl whoi are on this mobile network [15:49:43] savvy2012: they dont have offices etc [15:49:49] ysbq: so that is an example of hybird [15:49:55] savvy2012: yesh [15:50:14] savvy2012: {ms1689} but its 1 month contract. u r not tied in for 12 month contract or anything [15:50:39] ysbq: we can see that service industry is full of these products unlike other tangible industry [15:50:45] savvy2012: at the moment fot this type of contract its best value on the market whilst offering most (unlimited internet and texts) [15:50:56] ratna1238: {savvy2012} AHA!!! so... GiffGaff manage to ACHIEVES DIFFERENTIATION but also keeps the price down.. a cool example to me [15:51:05] ms1689: {savvy2012} ok, that makes it more flexible. If you want to get out you can with out hasle [15:51:18] savvy2012: {ysbq} yeah because service industries dont need to buy in goods like tangible businesses do [15:51:38] savvy2012: {ms1689} yeah [15:51:44] ysbq: yeah [15:52:05] ratna1238: so.. this 3 clock hours of Stragy Clock is really based on PRICE [15:52:12] ratna1238: 1 and 2 just plain price [15:52:12] savvy2012: {ms1689} u can also get more minutes if u pay £5, £10 or £15 a month more- so thats justification of price for value added :) [15:52:13] ysbq: yes [15:52:27] ratna1238: 3 is to achive the DIFFERENCIATION but still low price [15:52:52] savvy2012: {ratna1238} yeah id say so... [15:52:57] ms1689: {savvy2012} :) [15:53:03] savvy2012: and 4 is achieve deferentiation but medium price [15:53:07] ysbq: {ratna1238} well for differentiation u charge a higher price [15:53:15] ysbq: okay lets move on to differentiation products and services [15:53:32] ysbq: medium price and high benefit [15:53:46] ratna1238: no.. the HYBRID STRATEGY is when the price is still kept low.. .but with differenciation [15:53:46] ms1689: differenciation would be like business class flights [15:53:57] ratna1238: that is at 3 o“clock :D [15:54:13] ratna1238: where at 4 and 5 o“clock we r talking about higher price DIFFERENCIATION :D [15:54:16] ysbq: {ratna1238} yes [15:54:23] ms1689: higher standard and higher price [15:54:38] ysbq: 5 is focused differentiation [15:54:57] ysbq: more targetted to luxury and niche market products [15:55:00] savvy2012: so id imagine.. GiffGaff are following strategy 3 at the moment - low price for high added value - because they are new. but i wont be surprised if after they gain good market share they put their prices up, or maybe other compatitors by that time will reduce prices but GiffGaff will keep same pr [15:55:24] ratna1238: yeah.. maybe that is their strategy to win the market [15:55:54] ysbq: {savvy2012} yes that is there strategy to snatch the market share for others [15:55:56] savvy2012: so they will be following strategy 4 then [15:56:03] savvy2012: medium price and high added value [15:56:05] ratna1238: at 4 o“clock... the business need to decide carefully if their customers r willing to pay higher price for their products [15:56:12] ms1689: For example you may prefer to pay a bit more for a comfortable chair/bed on a 12 hour flight [15:56:47] ysbq: {savvy2012} probably after they have set their ground [15:56:48] ratna1238: {ms1689} I agree.... we r talking about higher level here... we have a product that the customer might want to pay more [15:57:20] ratna1238: I don“t mind being cramped like sardines in a 3 hour flights and flying at 3am, knowing that I will recover quickly from the suffering [15:57:36] ratna1238: but I would not want to be cramped like a sardine in a 12 hour flight [15:57:39] ratna1238: oh no [15:57:54] ysbq: {ratna1238} u are very price concious customer i would say [15:57:55] ms1689: {ratna1238} yes to pay more for a bit more privilege [15:58:25] ysbq: okay example of focused differntiation [15:58:28] ratna1238: {ysbq} I think most customers who haven“t got a lot to spend would think like me :D [15:58:29] ysbq: ? [15:58:42] ysbq: {ratna1238} i definetly agree [15:58:51] ysbq: focused differntiation [15:58:52] ms1689: Focused differenciation eg private jet [15:58:58] ratna1238: lets make the flight hours longer.... then we may get the focused diferentiation [15:58:59] ratna1238: :D [15:59:10] ysbq: yeah [15:59:16] ratna1238: like even 12 hours would do.... for Business Class flights [15:59:34] ysbq: so how would that be achieved? [15:59:37] ratna1238: where u have loads of rooms ..... lying down chairs [16:00:06] ratna1238: wow... Powerful Branding [16:00:42] ratna1238: at 5 o“clock we r offering high perceived benefits at high prices.... Often relies on powerful Branding [16:00:54] ratna1238: I went to a newly opened shop last week. [16:01:04] ysbq: like buying the product will make to feel special and distinguished and u will enter a priveldge club of people ,...crappy stuff like that [16:01:10] ratna1238: they sold a PLAYBOY silly bag for 50 euros!!! [16:01:11] ysbq: :) [16:01:27] ysbq: {ratna1238} brand loyalty i guess [16:01:34] ratna1238: where I know I can buy EXACTLY the SAME bag without the brand for... 5 euro!!! [16:01:53] ratna1238: it shows status for ppl who can afford that bag [16:02:03] ysbq: yeah [16:02:21] ysbq: so we are done with the clock [16:02:28] ratna1238: how about flying with BOEING?? [16:02:29] ratna1238: :D [16:02:40] ratna1238: fly fast like the speed of sound... [16:02:54] ysbq: well concord was an example [16:02:55] ratna1238: u forgot at 6,7 and 8 o“clock [16:03:05] ratna1238: ah.. yeah.. I mean Concord [16:03:09] ysbq: those are all fail strategies [16:03:20] ratna1238: until many of them start crashing [16:03:53] ysbq: they abandoned it ..... u save lives [16:04:27] ms1689: Strategies that would fail ...noone would be willing to pay higher price for an average or low service [16:04:27] ysbq: okay what abt differentiation through innovation? [16:04:31] ratna1238: the reputation went down the tip cuz ppl were worried of crashing [16:04:41] ysbq: {ms1689} {ratna1238} yes [16:04:59] ysbq: okay what abt differentiation through innovation? [16:05:12] unknown: hello all [16:05:21] ysbq: innovation is important for strategic success [16:05:24] ratna1238: well u know... I think at 6,7,8 o“clock.. example is possibly OIL!!! [16:05:30] ratna1238: {unknown} hey [16:05:35] ysbq: {unknown} hi join in [16:05:42] unknown: :d hi [16:05:57] ratna1238: it is like monopoly so it can still survive [16:06:03] ratna1238: like.... power [16:06:06] unknown: know nothing abt P3 as of now [16:06:07] ratna1238: like.... water [16:06:12] ratna1238: like.... telephone [16:06:59] ysbq: {ratna1238} basic utilities , are natural monopolies so the need not to gain competitive advantage [16:07:10] ysbq: ok lets move on [16:07:17] ysbq: innovation is important for strategic success [16:07:19] ysbq: why? [16:07:21] ratna1238: {ysbq} yeah... so the price can be kept high if the gov wants [16:07:33] savvy2012: sorry guys due to weather conditions i have to go [16:07:37] savvy2012: hope to see u next week [16:07:49] ms1689: {ysbq} innovation keeps you ahead of your competitors [16:08:00] ysbq: {savvy2012} well i will set my clock right next time [16:08:16] unknown: see u all [16:08:17] unknown: guys [16:08:22] unknown: bit [16:08:23] ysbq: {savvy2012} bye [16:08:26] unknown: bye [16:08:30] ysbq: {ms1689} yes [16:09:42] ratna1238: hmmmm with innovation [16:09:52] ratna1238: we r entering a new different angle of market here [16:10:02] ratna1238: we can increase the price cuz no competitors yet [16:10:07] ysbq: to what innovation can be applied [16:10:10] ratna1238: we r creating desires for the market [16:10:21] ysbq: {ratna1238} yes [16:10:49] ratna1238: the cost of production is still high [16:10:53] ratna1238: so price is high [16:11:12] ratna1238: marketing cannot be anywhere.... specialised place only [16:11:28] ysbq: it is sth that we studied in core competencies [16:11:34] ms1689: We can add something unique to our product to differenciate it from that of the competitors [16:12:01] ysbq: inorder to gain unique capabillity for competitive advantage [16:13:14] ysbq: ok where innovation could be applied in an entity [16:13:16] ysbq: ? [16:14:03] ysbq: hint = value chain [16:14:14] ms1689: you would be spening on R&D to stay ahead but for that additional cost, customers may be willing to pay premium [16:14:46] ratna1238: like... iPad n iPhone [16:14:56] ratna1238: every year... new version [16:15:19] ms1689: Due to Christening barbecue of my nephew, i also will have to go [16:15:27] ratna1238: we r expecting to get better or new things each time [16:15:30] ysbq: {ms1689} ok [16:15:41] ratna1238: ah... leaving u n me [16:15:43] ratna1238: in a room [16:15:44] ratna1238: hahaha [16:15:50] ratna1238: disaster can happen [16:15:51] ratna1238: :D [16:15:51] ysbq: well i meant to hear that innovation could be applied to different activities of value chain [16:16:12] ms1689: See you next week! :) [16:16:24] ysbq: {ms1689} of course [16:16:45] ysbq: of course R&D will be crucial to that innovation [16:16:50] ratna1238: ok [16:17:21] ysbq: {ratna1238} Knowledge management systems? [16:17:56] ratna1238: OK [16:18:05] ysbq: what are these can u share any previous knowledge [16:18:17] ratna1238: we r now talking about differentiation thru Knowledge Management [16:18:36] ysbq: {ratna1238} yes [16:18:58] ysbq: Knowledge management is important it also helps in R&d [16:19:06] ratna1238: yes [16:19:35] ysbq: first of all wht is knowledge [16:19:36] ysbq: ? [16:19:53] ratna1238: it is info that some one has in his mind [16:20:42] ysbq: {ratna1238} ok it could be also sth that would be known to others [16:21:17] ysbq: types of knowledge? [16:21:45] ratna1238: Explicit and Tacit knowledge [16:22:03] ratna1238: Explicit is generally written down n orgi knows that it exists [16:22:16] ysbq: yes [16:22:31] ratna1238: Tacit is not written... often in the employees mind or skills [16:22:42] ysbq: and tacit is sth which is yet to be discovered and documented [16:22:46] ratna1238: orgi doesnt know that it exists to what extend [16:23:18] ysbq: okay processes involved in knowledge management [16:23:23] ysbq: let me list them [16:23:33] ratna1238: ok [16:23:41] ysbq: - discovering the knowledge [16:23:49] ysbq: - capturing knowledge [16:23:57] ysbq: - sharing knowledge [16:24:07] ysbq: - distributing knowledge [16:24:31] ysbq: - levering knowledge (getting benefit out of it) [16:24:39] ysbq: - maintaining knowledge [16:24:55] ratna1238: yeah... like.... the knowledge of a sales person about the specific areas [16:25:26] ratna1238: the sales person.. would know the preference in the areas that he covers [16:25:33] ysbq: {ratna1238} yeah like the behaviour customers and their trends etc [16:25:38] ratna1238: the orgi would not know it if he doesnt share it [16:25:56] ysbq: {ratna1238} yes [16:25:57] ratna1238: so.. with his skills, he learns the behaviour n preferernces [16:26:07] ratna1238: then gain the knowledge [16:26:12] ratna1238: then share it [16:26:18] ysbq: {ratna1238} more like experience [16:26:24] ratna1238: yeah [16:28:46] ysbq: benefits for knowledge management systems [16:28:53] ysbq: to organisation [16:29:16] ratna1238: hmm I am guessing [16:29:49] ratna1238: witih this knowledge the orgi can actually use it for its benefit to gain competitive benefits from its competitor in the market [16:30:00] ratna1238: producing the products that the customer wants [16:30:00] ysbq: organisations can set more targets to monitor for performanc evaluaiton [16:30:10] ratna1238: and know how to reach them [16:30:28] ysbq: {ratna1238} can keep a check on the changing trends and taste of customers [16:30:46] ratna1238: {ysbq} yes... it can set a level of monitoring as well [16:31:21] ysbq: helps the organisation to retain knowledge and will not be adversely affected by staff turnover [16:31:33] ysbq: next is hypercompetition [16:31:36] ratna1238: the knowledge management enable the orgi to share the knowledge a lot easier n faster [16:31:52] ratna1238: like using the IT systems [16:32:05] ysbq: {ratna1238} yes the process is more streamlined and effecient [16:32:11] ysbq: next is hypercompetition [16:32:14] ysbq: what is that [16:32:15] ratna1238: ok [16:33:01] ratna1238: it is where the frequency, audacity, innovation n aggressiveness of competitors creates an environment of costant movement n change [16:33:02] ysbq: an environment which is constantlly chainging [16:33:11] ratna1238: i have.. actually a good example for this [16:33:26] ratna1238: like the PROGRAMMERS... in the old time.. the market was very good doing programming job [16:33:31] ysbq: examples are music industry we have seen it change tastes from rock to rap [16:33:46] ratna1238: many IT CONTRACTORS appears [16:33:51] ratna1238: the pay was very good [16:34:26] ratna1238: BUT... due to the change of software n programming languages.. the IT contractors need to keep updating their knowledge and skills (products to sell) [16:34:33] ratna1238: otherwise they r out of the business [16:34:55] ratna1238: {ysbq} music industry is a tough one [16:35:01] ratna1238: from Cassette to CDs [16:35:04] ratna1238: to Soft copy [16:35:09] ysbq: yes [16:35:11] ratna1238: changes all the time [16:35:23] ratna1238: how they can compete with pirates [16:35:29] ratna1238: then also BOOKSTORE [16:35:34] ratna1238: then online store [16:35:37] ratna1238: then soft copy [16:35:41] ysbq: wht will be the startegies for this environment [16:36:01] ysbq: {ratna1238} no way only way is thru legislation [16:36:04] ysbq: such ACTA [16:36:26] ratna1238: We need to reposition our strategy clock [16:36:30] ratna1238: wow.. tough really [16:36:38] ratna1238: to be in this type of industry [16:36:49] ysbq: yeah adapt ... and adapt quickly [16:37:29] ratna1238: like a lot of singers now..... based their income from ppl liking them, getting to know them more personally then ppl would not mind paying a few cents towards their songs [16:37:36] ysbq: create barriers to entry like apple do for its mac books [16:38:01] ratna1238: ya [16:38:05] ratna1238: a very interesting topic [16:38:07] ysbq: technology barriers etc [16:38:32] ysbq: ok we are done with this chaper [16:38:35] ysbq: chapter [16:38:44] ratna1238: smart [16:38:58] ratna1238: thank u [16:39:05] ratna1238: i really enjoyed it today [16:39:27] ysbq: we need to just go thru how to sustain competitve advantage that would be done on own basis [16:39:29] ysbq: fone [16:39:45] ratna1238: ok [16:39:51] ysbq: fine thanks a lot for participation [16:39:58] ysbq: cya next sunday [16:40:01] ratna1238: pleasure is mine [16:40:03] ysbq: same time [16:40:07] ratna1238: dont forget to change ur clock [16:40:09] ratna1238: :D [16:40:16] ratna1238: it is now 12.40 in the UK [16:40:20] ratna1238: byeee [16:40:29] ysbq: :D [16:40:35] ysbq: donot u worry [16:40:37] ysbq: bye