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Grab's Success with Key Drivers of Innovation and Blue Ocean Strategy

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Added on  2023/06/15

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This report discusses Grab's success with key drivers of innovation such as technology, effective business models, and innovation. It also explores how Grab has used blue ocean strategy to create a new market space and attract more customers. The report examines Porter's generic strategies and Ansoff matrix frameworks to critically examine varied approaches undertaken by Grab to aid shape its entrepreneurial vision & business model.

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Strategy Enterprise and
Innovation

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TABLE OF CONTENTS
(a) INTRODUCTION .....................................................................................................................3
(b) Key drivers of innovation contributing to the success of the company................................3
(c) Using appropriate models, to critically examine varied approaches undertaken by Grab to
aid shape its entrepreneurial vision & business model...............................................................7
(d) Grab's success can be attributed to the successful application of Blue ocean strategy.......11
(e) CONCLUSION........................................................................................................................13
REFERENCES..............................................................................................................................14
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(a) INTRODUCTION
Innovation is a systematic process of making and inventing new ideas into a product or
services that creates business value and for which clients will pay. There are many kinds of
innovation includes incremental innovation, social innovation and others. Nowadays, innovation
is really important part in the world of business, because customers are more attracted towards
innovative ideas. Customer purchasing power is totally depended on the strategies used by
company, innovation and brand reputation. The present report will provide detailed information
about Grab company, providing various facilities such as grocery delivery, payments, financial
services and ride hailing. Furthermore, the study will provide information about the successful
journey of the company with the help of key drivers of innovation. Along with this, it will
provide information about business level competitive strategies and corporate level strategies. In
addition to this, study will evaluate the Grab's success with the application of blue ocean
strategy.
(b) Key drivers of innovation contributing to the success of the company
Grab is the most popular brand which was founded by Tan Hooi Ling and Anthony Tan
in the year 2012 in Malaysia. The brand started with a taxi hailing app which is designed by most
talented experts in order to improve safety and protection of taxi drivers (Meglio and Di Paola,
2021). The company's owner Anthony Tan and his top-level management team along with
employees have successfully managed to transform the company from taxi booking app into a
market leading organization.
Grab app- The company's super app is a most famous in the world where people can
easily make purchase goods or services as per their convenience. With the help of this mobile
application the firm has successfully achieved competitive advantages that offers on demand
daily services for millions of clients in south-east Asia. This business model has a huge impact
on society, safety of people, convenience, transportation facility and financial services. This app
is the most popular mobile payment platform where customer can book anything online and avail
services easily (Si and et.al., 2020). The customer can easily avail services like paying bills
online, ordering food, booking hotels, transportation. It provides benefits to keep its users close
the app for their everyday services. For example- nowadays, people are more concerned about
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social distancing and doesn't want to go outside for their everyday services, users can pay bills,
order food, send important parcels from the Grab app.
Technology- The company is so successful just because of its strong focus on technology
and innovation. In today's business world, people are more attracted towards technology and new
strategies such as online shopping, home delivery of grocery items, online hotel booking and
others like transportation related facility. Hence, the company has clearly understands about
customer purchasing behaviour and attitude as it is totally depended on these factors. In addition
to this, they have adapted to the different languages and culture in each country they expanded
into, which helped them gain a lot of new customers (Li-Ying and Nell, 2020).
The firm offers a innovation and technology platform that connects clients with various
service providers. By focusing on creating a digital bank, the firm empower more new clients.
Top level management team of the firm has now expanded its business operations into different
business verticals. For example- mobility, effective payment modes and home delivery of goods,
car-sharing, ride sharing, car rental and bicycle sharing. Now the firm is focusing on launching
online healthcare services which is beneficial for social welfare.
Effective business model- Grab app and Grab Taxi functions like every other ride-hailing
service in the sector. The company's business operations includes: online booking of ride in
which user enters the drop and pick up locations. After that, it will send the request to the nearby
taxi drivers, if a driver is nearby then he will accept the request. Reaching the location the
customer pays the amount in cash or online payment.
Grab for good- This is the unique social impact programme which is launched by the
company in the year 2019 in partnership with the most famous company Microsoft. This
programme has been established to improve literacy and digital skills to the people of south-east
Asia. They are focusing on training and development program to empower millions of audience,
by creating major opportunities for them in a digitalization (An insight into the Technology
world, 2021). Along with this, the company major aim is to support small scale companies which
are the most realistic source of employment. Because people can have jobs as the young
generation are more likely to work in the technology and innovation sector in the future.
Reward system- In today's business environment people are motivated and attracted with
the help of various strategies such as rewards, subscriptions and other benefits, so does users of
the Grab app. The firm has various strategies such as rewards and subscriptions which help them

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to build clients loyalty and gain customer satisfaction level. The firm offers reward points for
spending on Grab app and availing services on its app. Customers can redeem those points in the
form of cash vouchers at coffee shops, KFC and for free ride on bikes. In this way, they have
created their strong customer base in the market.
Key drivers
Innovation
Reward system
Technology
Grab for good
Grab app
Taxi cabs, Grab Bike
Mobility
Transportation
ride
Online booking
Home delivery
Improves profitability
Increase market position
Satisfy customer needs
Achieve market trends
Effective communication
Effective marketing
Financial services
Online payment
Insurance
investment
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Disruptive innovation means the concept or services that can create a new ideas and value
network either with the help of disrupting an existing market or when the company creates a
completely new market in the business world.
Radical innovation means when a new innovative idea or technology completely disrupts
existing business model and along with this creates a new model for business. For example- Grab
use business model which is famous as revenue model to create its own market space in the ride
hailing business.
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(c) Using appropriate models, to critically examine varied approaches undertaken by Grab to aid
shape its entrepreneurial vision & business model.
In order to gain competitive advantages, giving tough competition to rivals, increasing
profitability and productivity, Grab and its management may take varied actions and underpin
strategic methods. Each method may help firm to shape business structure and vision statement.
The approaches that organization may use are covered under specific term and that is Porter's
generic strategies and Ansoff matrix frameworks. These two models play vital role in growth and
unpredicted success of company, in varied manners. It may enable firm to drive attention toward
using competitive tactics at business unit and corporate level and these strategies are:
Porter's generic strategies-
Cost leadership-
It is one of those strategic and competitive tactics that organization may utilize in
effective and efficient manner, to shape business mission successfully and model as well. For
example, in case of Grab, management may take action to set low price related to products and
services that they may plan to offer to local people in the national & international boundaries.
Low pricing strategy may enable individual person to retain with brand service and quality items
and give reason to do not switch. It may lead to increase profitability along with consumer base,
which is not that easy for any company to do so as it needed a lot of hard work and strategic
planning.
Differentiation-
In order to shape vision, firm may take this technique or tactic into consideration, which
aid to move management toward adding more value in category of products in term of
innovating new and something different from rivals. Differentiation strategy help to achieve set
aim and objectives of company, which is quite for venture growth and success. It may enable
management to retain and acquire potential customers who are able to conduct word of mouth
promotion after obtaining full on satisfaction from online application that firm may plan to offer
to individuals. It may enable them to book a cab and track the location along with sharing the
same thing with others.
Cost focus-
Along with above tactics, the current one may also affect the way firm lead in the market
and offer or provide food delivery and other services to local customers (Cost Focus Strategy

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Explained, 2021). Cost focus strategy is as essential and beneficial as above, because it may
contribute to entice consumers, which consider its key benefits. It may make supply chain
efficient, that is important for manager do make so, in productive manner. It can be said that with
cost focus tactic, streamline supply chain procedure may reduce costs that are associated with
dealing to third parties. It plays vital role to gain the attention of international customers and
retain them with existing forever.
Differentiation focus-
An organization may utilize this tactic, which enable them to shape mission and enhance
business model (The Pros and Cons of a Differentiation Business Strategy, 2021). For example,
in case of Grab, this strategy aid to reduce price competition, which is quite essential and helpful
regarding business growth. According to this tactic, firm may take initiative to provide or offer
Illustration 1: Porter's Generic Strategies
(Source: Porter’s Generic Strategies, 2020)
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something unique that encompasses key features that gain the attention of more customers and
retain current for longer time. Organization may differentiation things in varied term such as on
the basis of product, service, channel, price, reputation, etc. all these initiatives in turn provide
unexpected benefits.
Ansoff matrix model-
Market penetration-
Grab with the help of this strategy may shape its entrepreneurial vision in term of driving
workers and other stakeholders' attention toward improving the quality and features of existing
products or services. In this term, they may achieve set goals and strategic business objectives
that contribute to reach international level and gain more benefits along with current. It may
drive their attention toward concentrating on selling more of its items into existing market, which
enable to acquire a high market share and more of rivals consumers, which is challenging and
beneficial for organization to do that. It may allow firm to become a competitive brand in the
market.
Product development-
This technique or approach is used by varied companies, because of several reasons
(Weiwei, 2021). Grab may utilize it for purpose of enhancing customer satisfaction level and
gaining competitive advantages in bulk. According to this method, firm may take approach to
introduce new taxi booking application, which give a pleasure of customers about booking cabs
online, without standing along in a long queue. By creating this new app, organization may
provide customers reason to retain with it and also to competitors target market to engage with
brand forever, which in return give them more advantages beyond their expectations and
according needs.
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Market development-
This tactic may enable firm and its management to stand competitive in the market
whether it is international or national. With this strategy, Grab may grow rapidly and take
pleasure of increasing sales, profit margin and performance level. According to that, it may take
initiative to introduce its existing items such as taxi application to target customers that it may
have not yet reached or are not currently serving. The best thing about chosen tactic is that it may
contribute to generate revenue and gain new consumers that in turn enlarge customer base of
Grab. It may allow firm to expand the existing business and build excellent brand image across
national boundaries.
Diversification-
The most challenging and risky tactic of Ansoff matrix model is current one, which may
lead to decrease the profitability of company, in case when firm become a failure to implement
that in appropriate manner. This success of this strategy implementation, in turn provide varied
advantages to company. For example, it may aid to minimize risk of loss to its overall portfolio,
expose firm to more chances for return and also contribute to reduce volatility. It may able
management to take pleasure of increase sales more than investment.
Illustration 2: Ansoff Matrix
(Source: The Ansoff Model, 2021)

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(d) Grab's success can be attributed to the successful application of Blue ocean strategy
Surviving in a technology market isn't easy and high competition in this industry heavily
affects the profitability of the business. At this situation, it is necessary to explore deep waters
which can open up new market space and establish a monopoly. This will attract more new
clients and allow the company to use the vast potential of unexplored market position. Blue
ocean strategy says that create your own market strategy and a unique profitable space rather
than competition in the market.
Blue ocean strategy
Nowadays, due to heavy competition in business world the company are more focusing
on beating competition to its competitors. Blue ocean strategy is all about how the company can
create new market position and make the competition very irrelevant (Ellinger and et.al., 2020).
In other words, it shows how the firm is using its differentiation method to attract more new
customers and maintaining their existing customer by offering them benefits.
Importance of Blue ocean strategy
This strategy improves productivity of the firm which is beneficial to create new market
space. It will help in making technology advancements so that customer satisfaction can
be achieved. With this strategy, any company can encourage themselves to offer valuable
goods to their clients.
This strategy says that company needs to use low cost strategy to open a new market
place and create a new demand for customers. It is all about capturing uncontested market
position and can be maintained by the beliefs and action of the firm. In this strategy, the firm has
lots of opportunity in order to create growth and development that is profitable. It is the powerful
tool which is used by Grab to achieve profitable growth.
To break from heavy competition in the technology industry, Grab focused on
reconstructing the market boundaries which is the first and foremost principle in creating this
strategy. The firm has adopted various paths in formulating blue ocean strategy such as:
In today's business world, company compete not only within the similar field but also
with other company which produce alternative services and goods (Gibbs and Poisat, 2020). The
very first path of blue ocean strategy is to identify the alternative industries. The function of the
technology industry is to provide everyday services such as online shopping, booking hotels,
home delivery and others. The substitutes to this industry are retail sector or e-commerce field
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such as physical stores, shops and online websites which serves the same purpose. Thus, by
focusing on the key components that lead purchaser to trade across alternative, the Grab is
creating a blue ocean of new market space.
An organization has been making efforts to expand its business through strategic
expansion, acquisitions and partnerships with other brands. For example- Grab's mobile wallet is
most popular in different locations like Malaysia, Singapore, Myanmar and others. By
understanding the needs of customers and their preferences the company is achieving its market
space. Also, by knowing about the trends, what trends have a profitability and its impact on the
company, any industry can open up customer utility. From this, the firm can find the process
which helps them to create new perspectives and increase creativity. Grab is offering familiar
service with upgraded features this make the company unique (Blue ocean strategy, 2021). The
company's owner says that it is necessary to look beyond the competition. Manager of the firm
must adopt this strategy to find and improve markets and boost the growth of firm.
Grab managed to master the technology market and transportation needs of clients, so
they have invented GrabBike and ThoneBane. The major strategy of Grab is to focus on services
which influence positively to improve customer experience with the help of new technology. By
understanding the power of technology in this business world, they have given valuable data
insight into its clients which leads to the promotion activity of transportation modes.
Jakarta is third most congested city in the world and even criticized for its lack of a well
functioning public transportation system because of population of more than 10 million people,
the city is facing issue. Ride hailing and taxi services such as Grab are also available to provide
everyday services to people (Carton, 2020). The company offer safety and comfort to people
who need to use everyday services like travelling.
Strategy canvas tool- It is a tool with which company can compare products and its
factors, with the help of this tool one can immediately see what are the things one should
improve. For example- if company have worded out the strategy canvas effectively, it gives clear
idea about differences and similarities between firm or product.
Value curve- with the help of value curve, company can easily understand where value is
created within the firm's services or products. It will show graphically how the business can
create new market position with effective strategies and offers. This is the best example of
providing value to clients against competition in the market.
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Uber is one of the most popular brand in the field of technology as the company offers
services of taxi cabs. They transformed the transportation facility by introducing a low cost
business strategy for taxi cabs that were easy to book. People can easily book their journey
online with the help of Uber mobile app.
(e) CONCLUSION
To conclude, technology based innovation represents company that adopt creative ideas
and new advanced technologies to attract customers. If the company adopts advanced technology
it will improve customer benefits relative to existing goods in the existing market for clients. By
evaluating the report it is concluded that Grab has successfully managed to attain the market
space with its unique strategy, now expanding its business operation with on demand super app.
The company is operating across multiple cities in various locations, it has digital platform that
provides several on demand services under on roof. For example- Home delivery, online booking
and grocery items. Any company can expand its business by following the strategies of Grab and
adopting blue ocean strategy.

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REFERENCES
Books and Journals
Carton, G., 2020. How assemblages change when theories become performative: The case of the
Blue Ocean strategy. Organization Studies. 41(10). pp.1417-1439.
Ellinger, A. E. and et.al., 2020. Applying blue ocean strategy to hire and assimilate workers with
disabilities into distribution centers. Business Horizons. 63(3). pp.339-350.
Escobar, O. and et.al., 2021. Lead user innovation and entrepreneurship: Analyzing the current
state of research. Journal of Small Business Management, pp.1-18.
Gibbs, M. D. and Poisat, P., 2020. A framework of key enabling drivers for innovation:
Perceptions of community engagement scholarship of science fairs. South African Journal
of Higher Education. 34(1). pp.80-98.
Li-Ying, J. and Nell, P., 2020. Navigating opportunities for innovation and entrepreneurship
under COVID-19. California Management Review. 63(1).
Meglio, O. and Di Paola, N., 2021. Innovation and entrepreneurship for well-being and
sustainability. Sustainability. 13(16). p.9154.
Müller, J. W., 2021. Education and inspirational intuition-Drivers of innovation. Heliyon, 7(9),
p.e07923.
Orji, I. J. and Liu, S., 2020. A dynamic perspective on the key drivers of innovation-led lean
approaches to achieve sustainability in manufacturing supply chain. International Journal
of Production Economics. 219. pp.480-496.
Si, S. and et.al., 2020. Disruptive innovation and entrepreneurship in emerging
economics. Journal of Engineering and Technology Management. 58. p.101601.
Weiwei, L., 2021. Analysis of Ansoff Growth Strategy: a Case of Chinese Yunnan Baiyao
Company. Industrial Engineering and Innovation Management. 4(2). pp.1-6.
Online
An insight into the Technology world. 2021. [Online]. Available through:
<https://savvycomsoftware.com/case-study-grab/>
Blue ocean strategy. 2021. [Online]. Available through: <https://harappa.education/harappa-
diaries/blue-ocean-strategy-examples/>
Cost Focus Strategy Explained. 2021. [Online]. Available Through:
<https://www.eposnow.com/uk/resources/cost-focus-strategy/>
Porter’s Generic Strategies. 2020. [Online]. Available Through: <http://www.free-management-
ebooks.com/news/porters-generic-strategies/>
The Ansoff Model. 2021. [Online]. Available Through:
<https://www.smartinsights.com/marketing-planning/create-a-marketing-plan/ansoff-model/>
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The Pros and Cons of a Differentiation Business Strategy. 2021. [Online]. Available Through:
<https://advancepointcap.com/differentiation-strategy/>
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