Ahad, Oktober 16, 2005

Birth of Mimos in a Blue Ocean

Birth of Mimos in a Blue Ocean
L.S. Sya

Oct 16: IT was an interesting business theory that W. Chan Kim and Renee Mauborgne published in the October 2004 issue of Harvard Business Review called the Blue Ocean Strategy.

The authors had put forth the ground-breaking theory that most companies are competing in overcrowded industries, markets that they called the "Red Ocean" where the sharks are in a feeding frenzy.

The authors advocated that the best industries to get into are Blue Ocean ones where the market is virtually uncontested and competition, in form and substance, is virtually non-existent.

There are two ways to create Blue Oceans. One is to launch completely new industries. In many ways, the Internet and k-economy businesses are Blue Ocean ones. E-bay with their on-line auctions is a classic Blue Ocean business. The other is to extend the boundaries of an existing industry.

Companies have long engaged in head-to-head competition, fought for competitive advantage and battled for market share.

Today’s overcrowded market where there is competition head-on for results is nothing but a bloody "red ocean" of rivals fighting over a shrinking profit pool and this is not very smart.

By challenging everything you thought you knew about the requirements for strategic success, Kim and Mauborgne contend that most companies compete in Red Oceans and this strategy is unlikely to create profitable growth.

Based on a study of 150 strategic moves spanning more than a 100 years and 30 industries, Kim and Mauborgne argue that tomorrow’s leading companies will succeed not by battling competitors, but by creating Blue Oceans of uncontested market space with prospects for growth.

Such strategic moves — termed "value innovation" create powerful leaps in value for the firm and its buyers, rendering rivals obsolete and giving rise to new demand.

The Blue Ocean Strategy provides a systematic approach to making the competition irrelevant.

Now published into a book, the Blue Ocean Strategy presents a proven analytical framework and the tools for successfully creating and capturing blue oceans.

Examining a wide range of strategic moves across a host of industries, the Blue Ocean Strategy highlights the six principles that a company can use to formulate and execute strategies.

The principles show how to reconstruct market boundaries, focus on the big picture, reach beyond existing demand, get the strategic sequence right, overcome organisational hurdles, and build execution into strategy.

Discussing the Blue Ocean concept with me recently was an urbane and intellectual looking CEO who had just moments before been busy on his office desk-top computer. Excusing himself, he explained that he had just been into Google Earth, that wonderful yet potentially invasive 21st century facility on the Internet.

To think that you could zoom in from anywhere in the world and view with remarkable clarity, the activities in your neighbourhood is mind-boggling, to say the least.

And very Blue Ocean.

This was Tengku Datuk Dr Mohd Azzman Shariffadeen Tengku Ibrahim who was in the early 80s the Dean of the Faculty of Engineering, Universiti Malaya.

He led a group of academicians to get Malaysia moving into the k-economy, long before the publication of the Blue Ocean Strategy.

Malaysia was a leading country in exporting electrical and electronics products but the team realised that none of the product’s design, brand and marketing belonged to Malaysian companies.

They mooted the idea that the country needed an organisation to conduct microelectronics research to support the IT industry and to develop indigenous products.

The idea of setting up the Technology Park and the Multi-Media Super Corridor to help the country develop in the right direction was also mooted, and vigorously implemented by then Prime Minister, Tun Dr Mahathir Mohamad.

The Malaysian Institute of Microelectronic Systems Berhad (Mimos) was set up in 1985 as a unit under the Prime Minister’s Department with the mandate to accelerate the country’s development as a centre of excellence in IT and microelectronics.

Mimos has now evolved into a leading organisation specialising in ICT and microelectronics research, forging smart partnerships with universities and other research centres to pursue industry-driven research in pervasive computing, cyberspace and microelectronics.

Today, Azmann, who is the president and CEO of Mimos, has much to be proud of his organisation.

The brand vision of Mimos is instructive: "To be a world class applied research and development organisation in information and communication technology and microelectronics."

The aim is to develop a brand culture to inculcate an environment for R&D breakthroughs and to encourage an industry-oriented and market-driven research paradigm.

Perhaps, Mimos is best known for launching Jaring (Joint Advanced Research Integrated Networking project), Malaysia’s first Internet Service Provider in 1991 with several upgrades in both services as well as connectivity since then.

By taking Malaysia down the path to bridge the digital divide between our country and the rest of the developed world, Mimos has fulfilled a crucial role.

The Internet too has dramatically changed how companies compete and how they approach the global marketplace. The successful brands of the future are on the Net today and taking full advantage of its potential.

E-commerce is now more than just a buzz-word and everyone is getting wired. Laptops, note- books and PDAs not only fill the workplace but the home as well.

The message is clear. If you can communicate, you can leapfrog time and space. Globalisation is driven by technology and it is changing the world in warp-speed.

By joining the k-economy, companies can lower prices, gain customers and boost productivity. With more B2B transactions going on-line, the global marketplace becomes more efficient.

For Malaysia, all these would not have been possible if that group of academicians had not identified the urgent need for the country to move into the k-economy and encouraged the gravitation towards and the growth of the kind of businesses that the Blue Ocean Strategy is promoting some 20 years later.

Sya is the author of the best selling book Branding Malaysia. Widely recognised as the originator of "Brand Malaysia", Sya is also a member of the Asia Pacific Brands Foundation. He can be contacted at sya@brandmagic.org

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