Tue, May 26, 2009
My colleagues have been after me to read Blue Ocean Strategy for some time now.
Yesterday was the 14th day in a row of steady rain, so I spent the day getting to know this International Bestseller.
It is a good book, but it would have been just as good as a pamphlet.
I think you can get the majority of what you need from this book in just a page or two. So I thought I would give you my take on it.
The premise of the book is to encourage businesses to refocus their strategic planning to:
• Look where your industry is today
• Go somewhere else
Go where they ain’t.
I have been teaching my clients this for years.
The authors essentially are suggesting the following process:
• List the key competitive factors in your industry.
• How do you score in each of these areas compared to your competition?
• How can you separate yourself from the competition in these key areas?
• Can you create new factors that have not previously been the industry norm?
The key is that you don’t have to be better than the competition in each of the factors, just different. Many times customers do not want to pay for the cost of “better” when it is not seen as an increase in value. Delivering an increase in value to the customer is what is key in creating your new strategy.
One example they use is yellow tail wine. Yellow tail deliberately decided to be second-rate to the competition in areas of marketing, aging quality, and vineyard prestige. They created new competitive factors of easy drinking, ease of selection, and fun and adventure. These factors were new to the snobby wine industry.
To develop your new strategy, look at your industry’s key competitive factors and figure out what you can:
These are all vectors to point you away from the competition. Toggle the switches and turn the knobs in those four areas until you reach a strategic formula that provides a unique offering. Create your own frequency to broadcast.
Another example they use is Cirque du Soleil.
Cirque merged the circus, theater, and ballet all into one; a new business world where no one else had ventured. They went to a place that the neither Barnum & Bailey or the traditional theaters thought possible.
One of my definitions of creativity has always been this:
Creativity is a combination of things that already exist yet have not been used or applied previously in the same manner.
I call this Combination Creativity and that is exactly what Cirque du Soleil did with this new entertainment offering.
You could also say they simply applied the TRIZ Lens of Merging.
The Blue Ocean Strategy in not hard, but finding the guts to try it is another thing all together. The book spends quite a bit of time on how to reduce the risk of taking on this new unproven strategy. It is all good information, but to simplify, I always suggest to my clients:
“How can you fail in 2 weeks?”
Positioned this way, it creates a mindset that can’t let you down.
How can you go test this new strategy in only 2 weeks? You do not need a multi-year, million dollar pilot program; that’s poppycock. Go run a short test, it will provide your team invaluable feedback almost every time.
Do you know the #1 reason most ideas fail?
They never start.