This document discusses strategies for entering the smart cities market. It begins by providing an overview of the smart cities market size and growth projections. It then analyzes the key factors that government customers and existing industry players compete on. The document proposes applying the "4-action framework" to develop a new "blue ocean" strategy that avoids head-on competition. This involves eliminating unfavorable factors like a transportation focus and greenfield projects. It suggests raising the focus on favorable elements like data security and turnkey solutions. It also creates new offerings around citizen engagement, government-to-business interactions, and transaction transparency. This revised strategy aims to open new market space and gain access to data.

1. Smart e-Governance
An entry strategy for Smart Cities
Adapting the Blue Ocean Strategy*
Shubham Bhattacharya
July 26, 2013
* Authored by W. Chan Kim & Renée Mauborgne

2. Smart City – ‘Smart’ solutions & services
across verticals
2
Smart transportation
Smart government
Smart energy
Smart water
Smart buildings
CAGR: 16.2%
Smart Cities
2012: $6B
2020: $20B
21%
14%
65%
Share
19.5%
24.0%
CAGR
Source: Pike Research
Shubham Bhattacharya

3. Or an old wine in a new bottle?
3
Marketing
term for new
customers
Aggregation
of various
products
Greenfield
&Brownfield*
* Greenfield : New Cities, Brownfield: Existing Cities
Shubham Bhattacharya

4. Battle for “Data”, the next strategic asset!
•Smart Transportation vendors will lose control of transit data
•Payment service providers testing contactless payment
technologies
Visa &
MasterCard
•Several entrants competing for a share of this pie
•US Mobile Payment Market: Growing at CAGR: 47%. From
~$13B in 2012 will reach $90B in 2017 1
Mobile Wallet
•NFC* enabled handsets & mPOS* vying micro-transactions
•Global Mobile Payments Market: $617B by 2016 2Mobile Banking
4
1,2: Source: Gartner Inc., Forrester Research, MOBILE Payments Market Guide 2013, The Paypers
*NFC : Near Field Communication
*mPOS:Mobile Point of Sale
Shubham Bhattacharya

5. KEY ELEMENTS OF COMPETITION!
MAPPING THE VALUE CURVE*
Strategic Canvas – Representing the benefit of strategic factors
5
*Value Curve: To be defined, elaboratedand built in subsequentsection

6. What govt. customers care about?
6
Data Security
G2G* collaboration
Vendor Brand Name
Turnkey Solution Provider
Greenfield & Brownfield projects
* G2G: Governmentto Government
Shubham Bhattacharya

7. What industry incumbents compete on?
7
ICT infra.
Cloud
solutions
M2M & IoT
deployments
BI from data
Predictive
analytics
ICT: Information& CommunicationTechnologies | M2M : Machine to Machine | IoT: Internet of Things | BI: Business Intelligence
Shubham Bhattacharya

8. Key factors of competition in industry
Transportation
focus
Green &
Brown field
projects
Mobility
infrastructure
Urban
planning
G2G
collaboration
BI from data
Data security
QoS*
improvement
Turnkey
provider
8
* QoS: Quality of Service
Shubham Bhattacharya

9. Focus on ITS*, ability to deliver green &
brown field projects matter mostValuetoBuyer
Low
High
The Value Curve
• The value of key competing factors to the buyer!
Key factors of competition
9
*ITS: Intelligent transport systems
Shubham Bhattacharya

10. Lets tweak the value curve
To find an under-addressed need
• Develop new markets
• Establish own niche
To devise an alternate entry strategy
• Avoid head-on competition
• Choose path of least resistance
To explore ways to reach the consumer
• Gain access to data
Value Innovation & 4-Action Framework: Reduce costs & maximize buyer value
10Shubham Bhattacharya

11. ERRC: THE 4-ACTION FRAMEWORK
Entering un-contested markets…
11
Key
Elements
Eliminate
Reduce Raise
Create

12. Identify good costs & bad costs, add
previously not offered benefits
ELIMINIATE
REDUCE
RAISE
CREATE
Expensive
Least important
Expensive
Less important
Not so expensive
Important
Relevant
New offering
12Shubham Bhattacharya

13. Map key elements - in the Red Ocean*
Red Ocean
ValuetoBuyer
Low
High
Key factors of competition
13Shubham Bhattacharya
*Red Ocean – The current scope of competition

14. Eliminate Reduce Raise Create
Map key elements, apply 4-action framework
Red Ocean
ValuetoBuyer
Low
High
Key factors of competition
14Shubham Bhattacharya

15. Eliminate Reduce Raise Create
Map key elements, apply 4-action framework,
plot new value curve
Blue Ocean
Red Ocean
ValuetoBuyer
Low
High
Key factors of competition
15Shubham Bhattacharya

16. Eliminate/Reduce unfavorable factors
• Eliminate direct competition with established
players
Transportation
Focus
• Avoid expensive Greenfield projects in light of
equipment-leasing financial liability
Green & brown
field projects
• Reduce operating expenditure incurred by
expensive hardware deployments
Mobility
infrastructure
• Reduce dependence on projects with high sales
turnaround time & customer acquisition costUrban planning
16Shubham Bhattacharya

17. Raise focus on favorable elements
• Boost through BPI* solutionsG2G collaboration
• Leverage BI to analyze patterns & unravel
gaps in offering vs. customer needsBI from data
• Promote & participate in initiatives to
secure data accessData security
• Assess demand management and
improve citizen services’ QoSQoS improvement
• Be a preferred System Integrator for
turnkey solutionsTurnkey provider
17
•*BPI: Business Process Improvement
Shubham Bhattacharya

18. Create new offerings in e-Government
solutions
• Improve G2C* engagement: ease data
collection, service provisioning
Citizen
engagement
• Improve G2B* interaction: boost
economic activity
G2B engagement
• Alleviate corruption: reduce monopoly
& discretion, raise accountability
Transaction
Transparency
18
*G2C: Governmentto Citizen; G2B: Governmentto Business
Shubham Bhattacharya

19. THE IMPACT & FIT
The alignment test
19

20. Organizational implications…
Is there scope for technology
development?
Can current research
capabilities be leveraged?
Is there a need to augment
current research capabilities?
20Shubham Bhattacharya

21. Thoughts…?
21