Blue Ocean Strategy
Chapter 4: Focus On The Big Picture, Not The
Numbers
Group 1
Tara Ferguson
Jt Lehotsky
Taylor Skidmore
Sunny To
Next Question
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
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After knowing the paths to creating blue
oceans
“How do you align your strategic planning
process to focus on the big picture and apply
these ideas in drawing your company’s
strategy canvas to arrive at a blue ocean
strategy?”
Most companies’ strategic planning process
back to red ocean = compete within existing
market space
Why so serious?

Typical strategic plan.
 Current industry conditions & competitive situations
 How to increase market share, capture new
segments, cut loss  goals & initiatives
 Attached budget, graphes, ect…
 Data provided by people various parts of organization
w/ conflicting agendas & poor communication
 Managers do what?
 Result: Oh so… not good! – managers paralyzed,
employees no idea

Closer look  no plan? Tactics w/ no
direction
Focus on the Big Picture, Not
the Numbers!!!

Drawing a strategy canvas, build strategic planning process
around it:
◦ Visualize a company’s current strategic position
◦ Chart future strategy
◦ Managers and employees focus on the big picture > numbers
and jargon and details

How?
◦ Shows the strategic profile of an industry by depicting very
clearly the factors that affect competition among industry
players
◦ Shows the strategic profile of current and potential competitors,
indentifying which factors they invest in strategically
◦ Shows the company’s strategic profile (value curve): how it
invests in the factors of competition and how it might invest (w/
all 3 qualities: focus, divergence, and a compelling tagline)
Drawing strategy Canvas

Assessing to what extent your company and
its competitors offer the various competitive
factors = challenging
◦ w/in own responsibilty = ok
◦ The whole industry = hard
◦ Ex: catering manager of an airline & refreshment
vs. customers & the complete offering
◦ Ex: CIO & the company’s IT infrastructure for its
data- mining capacity vs. customers & speed,
ease of use

Drawing strategy canvas is awfully hard
So what to do?

Last ten years, a structured process for drawing
and discussing a strategy canvas  blue ocean

150-year-old financial services group- European
Financial Services adopted this process to
develop a strategy that breaks away from the
competition  30% revenue boost in its initial
year

Process builds on the 6 paths of creating blue
oceans & has a lot of visual stimulation to
unlock people’s creativity = 4 major steps
Step 1: Visual Awakening

Common mistakes
◦ Discussing changes in strategy before resolving
differences of opinion about the current state
of play
◦ Reluctance to the need of change

Then how do you get around to making
changes?

European Financial Services
◦ Poorly communicated strategy
◦ Deeply divided among regional subsidiaries and
corporate executives

Asked to chart their company’s strategy – but
found that they must first reach a common
understanding of their current position
◦ 20 + senior managers
◦ Team 1 – Produce a value curve for EFS’s current
strategic profile in traditional corporate foreign
exchange business relative to competitors
◦ Team 2 – Produce the same but for EFS’s emerging
online foreign exchange business

What constituted a competitive factor and what
are those factors?
◦ Both teams dealt with heated debated because of
different opinions
◦ Europeans – EFS had to offer consulting services on risk
management
◦ Americans – Stressed the value of speed and ease of use
◦ Other – Customers would be drawn in by the promise of
instant confirmation of their transactions

Presented their work – Revealed defects
◦ Lack of focus
◦ Investing in diverse and numerous factors in both
businesses
◦ Both were very similar to competitors
◦ Neither team could create a tagline to match their value
curve
◦ Contradictions
Google

“Instead, we went into the ranks and talked with the
project managers and engineers who make Google tick.
Here's what we learned...”

Rule 1: The User is in Charge
◦ “Google tracks the outcome of a huge sample of the queries
that we throw at it. What percentage of users click on the first
result that Google delivers? How many users click on something
from the first page?
◦ If you can do something that will improve the user's experience,
do it…. It obsesses over search-traffic figures, and it reads its
email.
◦ In fact, 10 full-time employees do nothing but read emails from
users, distributing them to the appropriate colleagues or
responding to them themselves.”
“How Google Grows..and Grows..and Grows” by Keith Hammonds 2007
http://www.fastcompany.com/magazine/69/google.html?page=0,0
Step 2: Visual Exploration

Go into the field to explore the 6 paths to creating
blue oceans
◦
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◦
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Look across alternative industries
Look across strategic groups within industries
Look across the chain of buyers
Look across complementary product and service
offerings
◦ Look across functional or emotional appeal to buyers
◦ Look across time

See what managers must make sense of – How
people use or don’t use their products or services

Never outsource your eyes!
◦ Talk to and watch Customers, Noncustomers,
Users
◦ Look at how they might find alternative ways of
fulfilling the need that your product/service
satisfies
 Ex: Driving vs. flying
 Google vs. local library or newspaper
 Google vs. Yellow pages

EFS mangers in the field for 4 weeks
◦ Observe 10 people in corporate foreign exchange
 Lost customers
 New customers
◦ Customers of EFS’s competitors and alternatives
◦ Companies who did not yet use corporate
foreign exchange services
◦ End users of corporate and foreign exchange
services – the accounting and treasury
departments
◦ Ancillary products and services also used –
pricing simulations

Results
◦ Sent back to the drawing boards
◦ Each team had to create 6 value curves using
the 6 path framework
 Each had to depict a strategy that would make EFS
stand out in its market and a tagline
 Hopes to push the managers to break the
boundaries of conventional thinking
Step 3: Visual Strategy Fair
Draw your “to be” strategy canvas based on
insights from field observations.
 The EFS teams presented their strategy
canvases at the visual strategy fair to senior
executives and external constituencies.
 Get feedback on alternative strategy canvases
from customers, competitors’ customers, and
noncustomers.

Step 3: Continued
EFS realized that one-third of what they had
thought were key competitive factors were
marginal to customers.
 Used feedback to build the best “to be” future
strategy.
 EFS was able to draw a value curve that was
truer to the existing strategic profile.

Eliminate-Reduce-Raise-Create
The Case of EFS
Eliminate
Raise
Relationship management
Ease of use
Security
Accuracy
Speed
Market commentary
Reduce
Create
Account executives
Corporate dealers
Confirmation
Tracking
Step 4: Visual Communication
Distribute your before and after strategic
profiles to all employees for easy
comparison.
 Support only those projects and operational
moves that allow your company to close the
gaps to actualize the new strategy.

Visualizing Strategy at
the Corporate Level
Using the Strategy Canvas
Blue Ocean companies have to communicate
and not just worry about the numbers
Samsung Electronics
Value Innovation Program (VIP)
At the conference projects are shared through
presentations and exhibitions and awards are given to the
best.
•World’s leading 40” LCD TV in 2002
•SGH T-100 worlds bestselling mobile phone
Pioneer- the businesses that offer
unprecedented value. (RSS Feed)
Settlers- businesses whose value curves
conform to the basic shape of the industry’s.
(Google Images)
Migrators- lie somewhere in between Pioneers
and Settlers. (Google Maps)
Strategic planning should be more about
collective wisdom building than top-down
or bottom-up planning.
It should be more conversational than
solely documentation driven.