 Red
Apr-15
Oceans of Competition – Margins & Share
(c) RAF Copyright April 2013 Cambridge
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1Ravi Fernando
Strategies to increase Competitiveness
of Sri Lankan Business
- How Competitive are we?
- The Future –Irreversible trajectory
- Creating ‘New’ market spaces
- What we need to do!
Ravi Fernando
July 2013
Apr-15
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STRATEGY
 “Strategy is about setting yourself apart
from the competition. It’s not just a matter
of being better at what you do it’s a matter
of being different at what you do”
Michael Porter
“Rethinking the Future”
“Strategy is being different in a relevant
way”
© Ravi Fernando (2013)
RAF SEPT 2009
Adjustment to the GCI scores by sustainability indicators
GCI 2012 – 2013
GCI 2012 – 2013
Sustainability adjusted GCI
Country/Economy
Rank
Score
Score
Switzerland
1
5.72
6.85
Germany
6
5.48
6.14
United States
7
5.47
5.31
United Kingdom
8
5.45
5.82
Japan
10
5.40
5.76
Korea Republic
19
5.12
4.89
Australia
20
5.12
5.46
Malaysia
25
5.06
5.14
China
29
4.83
4.44
India
59
4.32
3.73
Sri Lanka
68 +10 = 78
4.19
3.96
Venezuela
126
3.46
3.28
The World’s economic growth
and resource utilization is unprecedented !
Nominal world GDP since 1990
USD billions
World GDP (Nominal)
308,285
300,000
“Our Economy operates by stealing the future,
selling it in the present and calling it GDP”
– Paul Hawken
260,000
220,000
180,000
133,676
140,000
100,000
62,346
60,000
32,061
22,856
20,000
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Apr-15
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Source: IMF, Standard Chartered Research
The planet is in crisis!
Plan B – Branson & Zeitz (Polman,Tata & Robinson)
“Business is integral to society, but it has
created most of the negative environmental
challenges of the century…
The B Team will catalyze a shift away from the
existing short –term, unsustainable mind set
towards the long term interest of people , the
planet and the wider economy’. Tackling these
three challenges is a starting point for a ‘Plan B’
to form.
Jochen Zeitz –Chairman PUMA June 2013
Source: Living Planet Report 2008
Global demand -earth’s resources exceed regenerative capacity by 30%
 By 2030 Two planets are needed to meet the demand
8 April 2015
RAF Copyright July 2008
President Barak Obama
Inauguration speech
- 21st January 2013
 We will respond to the threat of
climate change ,knowing that
failure to do so would betray
our children and future
generations
 USA -National strategic initiative
‘We want to become the strongest
competitor & most influential
player to invest in Sustainable
prosperity – Mark Mykleby
Some may still deny the
overwhelming judgment of
science, but none can avoid
the devastating impact of
raging fires, crippling drought
and more powerful storms.
 The Climate Change Action
Plan June 2013
 34 Nations have a strategy
 ‘Consumers are ever greener, and their support for sustainable
products and services is growing worldwide. ……..becoming ecofriendly will soon be a necessary cost of doing business!’
-Nidumolu, R, Prahalad. C.K and Rangaswami . M.R (2009),
Why Sustainability is now the key driver of innovation?
HBR September 2009
 ‘Most executives know how they respond to the challenge of
sustainability will profoundly affect the competitiveness and
perhaps even survival of their organizations’
-Lubin.D.A and Esty.D.C (2010)
The Sustainability Imperative
HBR May 2010
RAF SEPT 2009

Blue Oceans of Opportunity!
 Creating new market spaces!
Blue Ocean strategy
• Creating new and uncontested market spaces to
make the competition irrelevant
• Developing an “offering” and Positioning & Differentiating
it to meet a need not met ‘in that way’ before!
Apr-15
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Blue Ocean Strategy
The Opportunity of ‘Non Customers’
• Nokia –BB-Apple-Samsung
•Tata Nano
• Phones as Cameras
• 1Bn Tourists – 2Bn to go!
• The automobile industry ‘Current users/market 10-12%
• Non users – 90% + in Tier 2&3
Creating a ‘new’ and ‘uncontested’
Market space
Leader
Followers
• Launched in 1997 in
Japan
Honda Accord Hybrid
• 2013 Best global green
brand –Interbrand
Ford C-Max Hybrid
Apr-15
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BMW ActiveHybrid
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Creating a new and uncontested
market space
• 1993 President Clinton
‘Fuel efficient’ cars
• Akihiro Wada –VP led team
of 1,000 engineers,
$1bn+R&D –G21 Project
• USA Low Oil prices in late
90’s
• GM Withdraws EV1 in 2002
• Priced at >$20,000
Strategic Pricing!
Apr-15
•
Launched in 1997 in Japan
• 2000 in 80 countries
• 2002 Prius sold 1M cars
•
…. brands follow
• 2013 March -5 Mn Hybrids
• 16% of Toyota sales and
40% in Japan
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General Electric’s new market space
“America should get busy
addressing the two
biggest global challenges
— clean energy and
affordable health care…
The leader in these fields
will dominate the global
economy in the decades
to come..
Jeffrey R. Immelt
Chairman and CEO
Top 50 Global ‘Green brands’ –INTERBRAND 2013
Strategic Corporate Sustainability
“Commitment to implementing strategies for Sustainable Business which
differentiates the organization, whilst impacting all stakeholders which
are in its sphere of influence.” © Ravi Fernando July 2008
Greenleaf Publishing 2014
• Sustainability leadership






Framing & Positioning
Governance structure
One strategy
Reward system
Measurement
Reporting
•
Sustainability-led
Differentiation
•Stakeholder engagement
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Nation ‘Create Market spaces’
Wine Industry
Made in France
Made in Australia
Automobile Industry
Made in Germany
Made in Japan
Electronic Industry
Made in The England
RAF SEPT 2009
Made in Korea
Fashion
Industry
Apparel Industry
Designed in
Italy
Made in
The UK
Designed in
Spain
Made in China
Can Sri Lanka ‘create new market spaces ?
Eco- Tourism –small to medium destination
Top 10 National Geo. Eco –destinations
Dubai /Costa Rica/ Laos
RAF SEPT 2009
Sustainable Nano Materials
- Titanium & Graphite
Sustainability Strategies
What needs to be done Sector – Tourism
Sustainably
Sustainability- Vision
Creativity /Innovation
Strategic Differentiation
Conservation
Sustainable architecture
/R&D Facility
Sustainably sourcing
Sustainably made –Mfg.
Locations
Travel
Logistics
Sustainable mind sets
Branding
Eco Tourism space
Sustainable Nano.Mat.
Graphite/ Titanium source
Nano.Materials space
Green is a new Blue Ocean for Business!
•
•
•
Future market spaces - Green
Future Strategy – SCS
How
- Blue Ocean Strategy
Thank you!
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8 April 2015
RAF Copyright July 2008
Sustainability-led ‘differentiation’ in Sri Lanka
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Singapore’s new market space
-A City in a Garden
• Global Hydro hub
• Green Cover
• Waste management – Semakau
Island to safely dispose waste in
an environment friendly way
Gardens by the Bay
From Garden city to City in a Garden
Green cover
•
•
1986 – Green cover 35.7 % and
Population of 2.7 Million
2012 – Green Cover
50 % and Population of 5.1 Million
Global Hydro Hub
•
75 % of country water is enable Storm
water collection
Storm
water
NeWater
Unilever’s ‘new market space’
Accelerating sustainable growth
•
•
"Companies can no longer sit on the
•
sidelines waiting for governments to
take action on the huge environmental
and social issues which face us. We have
to see ourselves as part of the solution
to these problems.”
Paul Polman
The Unilever Sustainable Living
Plan (USLP)
It includes around 60 targets and
embraces all aspects of our own
operations, going beyond them to
the entire lifecycle of our products.
Innovation and technology will be
key to achieving our goals. Equally
important will be our ability to
change consumer behaviour.
Requirements for Sustainability
Government
For
Business
Sustainability
Consumers
to work…..
Sustainable Policy
Sustainable
Business /Economy
Sustainable Consumption
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