In this Harvard Business Press article, the co-authors of the Blue Ocean Strategy book, W. Chan Kim and Renée Mauborgne explain the importance of alignment across the three strategy propositions of value, profit and people propositions, regardless of an executive's strategic approach to strategy. This article builds on the concept of value innovation, the concept of being able to increase value while reducing costs at the same time. This article was referenced by Paul E. Kmen in his paper on how companies can break the trade-off between improving the sustainability in their offerings versus the higher costs associated with becoming a truly social responsible company. The paper illustrates how becoming environmental-friendly can actually lower the production costs by reducing the inputs use
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| - In this Harvard Business Press article, the co-authors of the Blue Ocean Strategy book, W. Chan Kim and Renée Mauborgne explain the importance of alignment across the three strategy propositions of value, profit and people propositions, regardless of an executive's strategic approach to strategy. This article builds on the concept of value innovation, the concept of being able to increase value while reducing costs at the same time. This article was referenced by Paul E. Kmen in his paper on how companies can break the trade-off between improving the sustainability in their offerings versus the higher costs associated with becoming a truly social responsible company. The paper illustrates how becoming environmental-friendly can actually lower the production costs by reducing the inputs use (en)
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| - In this Harvard Business Press article, the co-authors of the Blue Ocean Strategy book, W. Chan Kim and Renée Mauborgne explain the importance of alignment across the three strategy propositions of value, profit and people propositions, regardless of an executive's strategic approach to strategy. This article builds on the concept of value innovation, the concept of being able to increase value while reducing costs at the same time. This article was referenced by Paul E. Kmen in his paper on how companies can break the trade-off between improving the sustainability in their offerings versus the higher costs associated with becoming a truly social responsible company. The paper illustrates how becoming environmental-friendly can actually lower the production costs by reducing the inputs used. By not taking the structure of the operating environment as a given, a company may generate additional revenues from better products and create new businesses by taking a reconstructionist approach to strategy. Whether an organization takes the structuralist or the reconstructionist approach to strategy, the set of value proposition, profit proposition and people proposition must be aligned in order to produce high-performing results in the long run. According to Kim and Mauborgne, a structuralist approach is one where strategy is developed to exploit the industrial and economic environment in which an organization operates. In other words, in a traditional competitive (structuralist) strategic approach, the structure of the industry is assumed to remain unchanged and the strategy of an organization is to exploit the industrial and economic conditions within the industry to achieve growth and profits by either pursuing a differentiated position or a low . Anything in between is considered "stuck in the middle". In this strategic approach, the value, profit and people propositions have to be aligned with the distinctive choice of pursuing either differentiation or low cost, each being an alternative strategic position in an industry. Under a blue ocean (reconstructionist) approach, where strategy is developed to reconstruct the industrial and economic environment in which an organization operates, the three strategy propositions must be aligned to pursue both differentiation and low cost. The article warns against the misalignment of the three strategy propositions through the case of Napster where the failure to create a strong people proposition for its business partners, the major recording labels at the time, cost Napster the opportunity to develop a viable profit proposition despite a highly differentiated value proposition. By contrast, iTunes created a powerful blue ocean strategic move by aligning across the value, profit and people propositions, thus making this Apple Inc. offering hard to imitate even to this day. (en)
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