You likely recall an entry we posted last week entitled 'LG’s Heart and Seoul: 2 By 10' regarding LG’s Blue Ocean Strategy mantra to rank as one of the Top 3 mobile communications companies in three years, and the Number 2 player by 2010.
Continuing the popular LG dialogue, we share with our Creating Blue Oceans community a copy of a recent interview with Gabor on LG and its implementation of Blue Ocean Strategy, specifically in India.
The interview is featured in the March 2007 edition of The Analyst, the flagship publication of ICFAI University Press, which brings to life the insights and best practices of corporate world in the area of finance.
The interview begins with the question from The Analyst “What is the rationale behind LGEIL adopting the Blue Ocean Strategy in India?” To this, Gabor responds:
LG is adopting the Blue Ocean Strategy (BOS) in India as part of its global strategy. LG has set ambitious growth targets for both revenues and profits for which BOS provides the blueprint for achievement. While other strategic concepts tell companies how to survive or realize incremental growth in well-defined, over-saturated markets (which we call “red ocean” market space), BOS gives a framework for breaking away from the competition to achieve high customer value and profitability simultaneously (which we call “blue ocean” market space).
More specifically, India has market attributes that make the application of BOS especially compelling: It is a vast and rapidly evolving market, so the business potential is ample over here. Indian consumers are very sensible and closely consider product attributes before purchase; so real product distinction is important.
Furthermore, LG has a strong position in almost every one of its product categories in India which would be difficult to maintain and expand, unless a strategy of continuous innovation is adopted. And lastly, LG is looking at India not just as a market destination but also as a production and export base. Therefore, adopting the right strategy and accompanying internal culture will help LG to build a strong international center of operations in India.
A full, downloadable copy of the interview is available via this link.