Blue Ocean Strategy.. part 3

Blue Ocean Strategy Summarizing Chapters 7-9


Four Hurdles

  • Cognitive – an organization wedded to the status quo
  • Resource – Limited resources
  • Motivational – Unmotivated staff
  • Political – Opposition from powerful vested interests

Tipping point leadership builds on the reality check, that for every business in the market there are people, acts, and activities that influence on its performance disproportionately
It allows you to overcome the four hurdles efficiently and at a low cost

Aim towards fundamental changes by building beliefs and energies of masses to create an epidemic movement towards an idea. Concentration is the key to unlocking an epidemic movement.

Three Types Overview
Hot spots – low input, high gain
Cold spots – high input, low impact. In every or- ganization, hot spots and cold spots typically Horse trading – trading excess for another excess to fill gaps

Place Kingpins in a Fishbowl – Based on transparency, inclusion, fair process then Atomize to get the organization to change

Build Execution into Strategy

  • Embrace new strategy willingly
    • People must be aligned with the strategy
    • Culture of trust and commitment should exist
  • Involve front lines in creation of strategy
  • Build execution into strategy from the start
  • Fair process in making and executing of strategy
    • everyone has an input in the process
    • Inspire voluntary cooperation

Fair Process – Intellectual and Emotional Recognition Theory
Recognition for intellectual, builds willingness to share their knowledge
Intangible capital –  praise employees who show

  • Commitment
  • Trust
  • Voluntary cooperation

Companies with intangible capital perform better and have quality in their execution at low costs

The Three E Principles of Fair Process

  • Engagement – involving individuals in strategic decisions
  • Explanation – why final strategic decisions are made
  • Clarity of expectation – clearly communicate the new rules and procedures

The Sustainability and Renewal of Blue Ocean Strategy
Barriers to Imitation

  • Value innovation
  • Brand image conflict
  • Natural monopoly
  • Copyrights, patents
  • High volume generated
  • Network externalities
  • Leap in value

When to Value-Innovate Again

  • Monitor value curves – strategy canvas
  • Hold on for profit from current setup
  • Operational improvements and Expansion
  • Reach out for another blue ocean

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