Try this Blue Ocean Strategy® tool: Strategic Canvas
What is the problem you are trying to solve?
Typically it’s that your company has stalled or failed to sustain profitable growth, and now you find yourself stuck in a very “red ocean” of bloody competition. The real nemesis here is a business model which pits you against others in your industry. Or maybe it’s the fact that you have attended so many trade shows in your own category that you can almost recite by memory what your competition is doing. Or it might be that you keep trying to differentiate your business, your talent, your approach, your processes and your value proposition from others that are really just like you. Trapped in this zero-sum game, you and they are merely dividing up a highly competitive world into winners and also-ran’s.
But in Blue Ocean thinking, you stop competing altogether. You make the competition irrelevant by not focusing on existing market space. Rather, you “reconstruct” your market space, creating a new market, adding value in highly innovative ways, tackling the unmet needs and demands of nonusers who found solutions in alternatives to your business offerings, and creating demand, not just fulfilling it.
Sounds like something you need? But where to begin? Let’s map out how you hold up today against others in your industry.
First, take stock of where your products and services fit in your own industry.
The canvas allows you to see the value you are adding today by plotting your investment against your major competitor(s) along the core areas where the industry is investing today.
An example from the hotel industry
The Contoso Hotel, a high-priced luxury hotel, was beset by rivals that were well-invested in the key factors of competition. The budget hotels were not distinguishing themselves except as low-priced competitors. For the Contoso, its Blue Ocean Strategy was to heavily invest in bed quality, hygiene and quietness in order to offer a meaningful point of difference in a highly competitive and overbuilt industry. Whether those were meaningful differentiators to create a new focus and attract nonusers is still to be tested. At least the canvas is starting to create a picture of their investment strategy today and how to create a new point of difference in the future.
- First, what are the key investments being made in your industry today? List them on the bottom of the canvas. This is not so easy. In one instance, it took a team of managers several hours to figure out what they were really all about. Think about your branding story, not just your budgets.
- Draw two lines on the page for today: your company and your competition. Try and bundle your competition into categories. Budget and Premium often work, but try not to have a dozen lines on the page (as one of our clients did).
- Go back and think about you. At SAMC, we use a tool called the Four Actions Framework. While it looks simple, it is a rather robust tool for you to use to determine what needs changing if you are going to open a Blue Ocean market space. What will you eliminate that offers little value? What will you reduce that is necessary but not really important? What will you raise that is going to start to really differentiate you from the rest? And lastly, what will you create? These are how you will shift your Strategic Canvas into new territory. In the Contoso Hotel’s Strategic Canvas, you can see the shift in their focus and their brand.
One of the strengths of Blue Ocean Strategy is that it is a way of thinking before you begin to do anything. And, as one of our clients said, “It just works.”
Do you need to shift your focus and open a new market space? We’d like to help. Contact us.