Project Scope Step 1 1. Initial objective (brand analysis, new brand, rebranding, advertising)? 2.

Resources available (time, people, money)? 3. Maneuverability (what can and cannot be changed)? 4. Implementation (who will and how will the plan be implemented)?

Project Scope Objectives {1 of 3}

Project Scope Step 2 5. Possible to have fair process to build execution into strategy? 6. Finalize project scope with buy-in, create statement of objectives 7. Choose the brand analysis tools; provide rationale 8. Set up critical chain timeline and assign resources 9. Perform postmortem on Project Scope Stage

Project Scope Objectives {2 of 3}
See Fair Process (Blue Ocean Strategy)

Project Scope Step 3 10. Execute analysis methods as per project plan 11. Provide input into methods use for ongoing improvement 12. Assess and evaluate plan as each method provides input

Project Scope Objectives {3 of 3}

Visual Awakening (1 of 4)
• Draw strategy canvas for industry or competitors and self • Determine which elements of the offering are of value and rank-order them
– Can ask customers about these as well as industry insiders

• Analyze by viewing through
– Four Actions framework – Value Curve goals – Value Curve litmus test

Strategy Map
• Excel template

Visual Exploration (2 of 4)
• Go into the field to explore the 6 paths
– – – – – – Industry Strategic group Buyer group Scope of product or service offering Functional-emotional orientation Time

• Observe the distinctive advatages of alternative products and services • See which factors you should elminate, create, or change (the four actions framework)

Visual Exploration (2 of 4)
Industry
Look across alternative industries, break out of own Look across strategic groups within industry, break out of groups Redefines industry buyer group, who is the buyer Looks across complementary offerings

Strategic group Buyer group Offering scope

Functional- Rethink functionalemotional orientation emotional
of industry

Time

Participates in shaping external trends over time

Four Actions Framework
Reduce
Which factors should be reduced well below industry’s standard? • • • • • • • • • • • • • • • •

Eliminate
Which factors the industry takes for granted should be eliminated?

Create
Which factors should be created that the industry has never offered?

Raise
Which factors should be raised well above the industry’s standard?

Value Curve Goals
No overdelivery without payback
High levels across all factors should result in high profits, otherwise offering too much. Which factors to eliminate and reduce? • • • • • • • • • • • • • • • •

Need coherences to the strategy
Value curve needs to collectively make sense and not simply have a lot of disparate highs and lows. Functional silos must be bridged.

Eliminate strategic contradictions
Sometimes a high factor requires another high factor to make good on promise. Does each factor have the support it needs?

Label factors in customers terms
Insider jargon does not work, but instead need outside-in perspective, driven by actual demand (and in customers’ terms)

Initial Litmus Test for Value Curve
• Focus
– Focus drives cost factors down – Lack of focus indicates complex business plan

• Divergence
– Value curve diverges from industry standards – Strategy must deviate from me-too-ism – Need to stand apart in the marketplace

• Compelling tag line
– Without, it is a sign of innovation for own sake

Visual Strategy Fair (3 of 4)
• Draw your “to be” strategy canvas based on insights from field observations • Get feedback on alternative strategy canvases from customers, competitors’ customers, and noncustomers • Use feedback to build the best “to be” future strategy

Visual Strategy Fair Feedback
• Feedback form

Visual Communication (4 of 4)
• Distribute before-and-after strategic profiles on one page for easy comparison • Support only those projects and operational moves that allow your company to close the gaps to actualize the new strategy

Project Evaluation Support Form
• Form including projects, evaluation of those projects in terms of moving the strategy forward (closing gap between current and future value curve) • Go or no go on projects based on evaluation • (Note: not needed for our class project)

Blue Ocean Strategy Sequence
Buyer Utility
Is there exceptional buyer utility in your business?

Price
Is your price easily accessible to the mass of buyers?

Cost
Can you attain your cost target to profit at your strategic price?

Adoption What are the adoption hurdles?

Buyer Experience Grid
• Create form based on previous slide

Location of biggest blocks to customer utility
• Create form based on previous slide

Buyer Utility - Purchasing
Customer Productivity Simplicity
How productive is the customer in this stage? How moreso can it be? How simple is this stage? Can it be made simpler? How convenient is this stage? Can it be made moreso? How much risk is there involved in this stage? Can risk be reduced? How fun and what level of positive image at this stage? More fun now!

Convenience

Risk

Fun & Image

Environmental How environmentally friendly is this stage? Friendliness
Make it more green.

purchase

delivery

use

supplements

maintenance

disposal

Buyer Utility - Delivery
Customer Productivity Simplicity
How productive is the customer in this stage? How moreso can it be? How simple is this stage? Can it be made simpler? How convenient is this stage? Can it be made moreso? How much risk is there involved in this stage? Can risk be reduced? How fun and what level of positive image at this stage? More fun now!

Convenience

Risk

Fun & Image

Environmental How environmentally friendly is this stage? Friendliness
Make it more green.

purchase

delivery

use

supplements

maintenance

disposal

Buyer Utility - Use
Customer Productivity Simplicity
How productive is the customer in this stage? How moreso can it be? How simple is this stage? Can it be made simpler? How convenient is this stage? Can it be made moreso? How much risk is there involved in this stage? Can risk be reduced? How fun and what level of positive image at this stage? More fun now!

Convenience

Risk

Fun & Image

Environmental How environmentally friendly is this stage? Friendliness
Make it more green.

purchase

delivery

use

supplements

maintenance

disposal

Buyer Utility - Supplements
Customer Productivity Simplicity
How productive is the customer in this stage? How moreso can it be? How simple is this stage? Can it be made simpler? How convenient is this stage? Can it be made moreso? How much risk is there involved in this stage? Can risk be reduced? How fun and what level of positive image at this stage? More fun now!

Convenience

Risk

Fun & Image

Environmental How environmentally friendly is this stage? Friendliness
Make it more green.

purchase

delivery

use

supplements

maintenance

disposal

Buyer Utility - Maintenance
Customer Productivity Simplicity
How productive is the customer in this stage? How moreso can it be? How simple is this stage? Can it be made simpler? How convenient is this stage? Can it be made moreso? How much risk is there involved in this stage? Can risk be reduced? How fun and what level of positive image at this stage? More fun now!

Convenience

Risk

Fun & Image

Environmental How environmentally friendly is this stage? Friendliness
Make it more green.

purchase

delivery

use

supplements

maintenance

disposal

Buyer Utility - Disposal
Customer Productivity Simplicity
How productive is the customer in this stage? How moreso can it be? How simple is this stage? Can it be made simpler? How convenient is this stage? Can it be made moreso? How much risk is there involved in this stage? Can risk be reduced? How fun and what level of positive image at this stage? More fun now!

Convenience

Risk

Fun & Image

Environmental How environmentally friendly is this stage? Friendliness
Make it more green.

purchase

delivery

use

supplements

maintenance

disposal

Price Corridor of the Mass
• First form
– Product/service types – Plot across actual dollar amounts – Using bar graphs or other types

• Second form
– Levels of protection – Simple table

Profit Model
• Excel spreadsheet
– Strategic price – Minus target profit – Equals target cost – Partnering – Plus pricing innovation – Equals target cost

Overcome Organizational Hurdles
Cognitive Hurdle
An organization wedded to the status quo

Resource Hurdle
Limited resources

Motivational Hurdle
Unmotivated staff

Political Hurdle
Opposition from powerful vested interests

• Ride the “electric sewer” • Meet with disgruntled customers • Free up resources from cold spots • Multiply value of resources • Move resources to hot spots • Horse trade for resources • Place kingpins in a fishbowl • Make fair process pervasive • Atomization of the larger goal • Secure consigliere • Activate angels • Isolate devils

Organizational Hurdles Forms
• Create forms
– Cognitive hurdles – Resource hurdles – Motivational hurdles – Poltical hurdles

Method Fair Process Overview

Fair Process Method (Description)
(Blue Ocean Strategy) {1 of 2} Fair process of engagement, explanation, and expectation of clarity engenders trust and commitment, producing voluntary cooperation, and enabling superior execution. “Involve individuals in the strategic decisions that affect them by asking for their input and allowing them to refute the merits of one another’s ideas and assumptions.” (p.175) “Everyone involved and affected should understand why final strategic decisions are made as they are. An explanation of the thinking that underlies decisions makes people confident…. And serves as a powerful feedback.” (p.175-6) “After a strategy is set, managers state clearly the new rules of the game…. Employees should know up front what standards they will be judged by and the penalties for failure. What are the goals of the new strategy? What are the new targets and milestones? Who is responsible for what? To achieve fair process, it matters less what the new goals, expectations, and responsibilities are and more that they are clearly understood.” (p.176)

Engagement

Explanation

Expectation of clarity

Method Fair Process

Fair Process Method (Form)
(Blue Ocean Strategy) {2 of 2}

1. Communicate the Has an overview of the fair process so that process been provided and all understand (3E) that process deemed fair? 2. Set up mechanisms and timelines for individual input 3. Create process so that decisions are understood Can everyone make meetings? Have meetings been given enough time? Has importance been clearly communicated? Are the meetings structured for clear flow of information? Are there mechanisms for additional wiki/faq/forums? What are the goals of the new strategy? What are the new targets and milestones? Who is responsible for what?

4. Set eval criteria, responsibilities, and achievement targets

Fair Process
Engagement
“Involve individuals in the strategic decisions that affect them by asking for their input and allowing them to refute the merits of one another’s ideas and assumptions.” (p.175)

Explanation
“Everyone involved and affected should understand why final strategic decisions are made as they are. An explanation of the thinking that underlies decisions makes people confident…. And serves as a powerful feedback.” (p.175-6)

Expectation of clarity
“After a strategy is set, managers state clearly the new rules of the game…. Employees should know up front what standards they will be judged by and the penalties for failure… To achieve fair process, it matters less what the new goals, expectations, and responsibilities are and more that they are clearly understood.” (p.176)

• What are the goals of the new strategy? • What are the new targets and milestones? • Who is responsible for what?

Creating Competitive Advantage
• Sustainable Competitive Advantage (SCA)
– Erect barriers to entry – Discourage new entrants, especially imitators

• Blue Oceans may have natural barriers
– Competitor brand image may conflict with blue ocean – Blue ocean may not fit conventional industry logic – Blue oceans require cultural, operational, political change

• Barriers created by Blue Ocean Strategy
– High degree of loyalty – High volume may lead to rapid cost advantages

• Other sources
– Natural monopolies (one player in a specific market) – Legal via patents or contracts

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