competitive differentiation bruce mcalpine, cpc president, fulcrum search science inc. acsess 10 th...
TRANSCRIPT
Competitive Competitive DifferentiationDifferentiation
Bruce McAlpine, CPCBruce McAlpine, CPCPresident, Fulcrum Search Science Inc.President, Fulcrum Search Science Inc.
ACSESS 10ACSESS 10thth Anniversary Anniversary ConferenceConference
Toronto, May 7-9, 2008Toronto, May 7-9, 2008
3 Big Questions3 Big Questions
1.1. How can I develop and price my How can I develop and price my company’s bundle of services to create company’s bundle of services to create uncontested market space and render my uncontested market space and render my competition irrelevant?competition irrelevant?
2.2. (Assuming this will involve internal (Assuming this will involve internal changes) How can I “sell” this to my staff changes) How can I “sell” this to my staff to get their buy-in and adoption?to get their buy-in and adoption?
3.3. How can I ensure that we are consistently How can I ensure that we are consistently delivering this unique bundle of services to delivering this unique bundle of services to our clients, thereby ensuring competitive our clients, thereby ensuring competitive differentiation, and hence “brand”?differentiation, and hence “brand”?
The “Blue Ocean Strategy” The “Blue Ocean Strategy” TheoryTheory
““Companies have long engaged in head-to-Companies have long engaged in head-to-head competition in search of sustained head competition in search of sustained profitable growth. They have fought for profitable growth. They have fought for competitive advantage, battled over market competitive advantage, battled over market share, and struggled for differentiation. share, and struggled for differentiation. Tomorrow’s leaders will succeed not by Tomorrow’s leaders will succeed not by battling competitors, but by creating ‘blue battling competitors, but by creating ‘blue oceans’ of uncontested market space ripe for oceans’ of uncontested market space ripe for growth.” (Chan Kim & Renee Mauborgne, growth.” (Chan Kim & Renee Mauborgne, Blue Ocean StrategyBlue Ocean Strategy))
Red vs Blue Ocean StrategyRed vs Blue Ocean Strategy
Red Ocean StrategyRed Ocean Strategy Compete in existing Compete in existing
market spacemarket space Beat the competitionBeat the competition Exploit existing demandExploit existing demand Make the value-cost Make the value-cost
trade-offtrade-off Align the firm’s Align the firm’s
activities with its activities with its strategic choice of strategic choice of differentiation or low differentiation or low costcost
Blue Ocean StrategyBlue Ocean Strategy Create uncontested Create uncontested
market spacemarket space Make the competition Make the competition
irrelevantirrelevant Create and capture new Create and capture new
demanddemand Break the value-cost Break the value-cost
trade-offtrade-off Align the firm’s activities Align the firm’s activities
with its strategic choice of with its strategic choice of differentiation and low differentiation and low costcost
Step 1Step 1
Identify the Factors on Which Identify the Factors on Which your Industry Currently your Industry Currently CompetesCompetes On what basis has our industry On what basis has our industry
traditionally competed? traditionally competed? What are the factors our competitors What are the factors our competitors
think are important to our customers?think are important to our customers?
Example – Cirque du SoleilExample – Cirque du Soleil
(ref “Blue Ocean Strategy” – Kim & Mauborgne)(ref “Blue Ocean Strategy” – Kim & Mauborgne)
Step 2Step 2
Examine the Factors using the Examine the Factors using the Eliminate-Reduce-Raise-Create GridEliminate-Reduce-Raise-Create Grid Looking at these factors, which ones really are Looking at these factors, which ones really are
important to our customers? important to our customers? What other products/services currently being What other products/services currently being
offered by industries close to ours would be of offered by industries close to ours would be of value to our customers? value to our customers?
What other factors not currently offered are What other factors not currently offered are really important to our customers, if them only really important to our customers, if them only knew they existed?knew they existed?
The Four Actions FrameworkThe Four Actions Framework
(ref “Blue Ocean Strategy” – Kim & Mauborgne)(ref “Blue Ocean Strategy” – Kim & Mauborgne)
Step 3Step 3
Build your New Strategic Build your New Strategic Offering BundleOffering Bundle Develop your new bundle of Develop your new bundle of
products/servicesproducts/services Package itPackage it Take it to the marketplaceTake it to the marketplace
The Cirque du Soleil Strategy The Cirque du Soleil Strategy CanvasCanvas
(ref “Blue Ocean Strategy” – Kim & Mauborgne)(ref “Blue Ocean Strategy” – Kim & Mauborgne)
Now It’s YOUR Turn!Now It’s YOUR Turn!
Getting “Buy In”Getting “Buy In”
Staff Workshop – Part 1 – Setting the StageStaff Workshop – Part 1 – Setting the Stage How are we feeling about our competitive How are we feeling about our competitive
position?position? What would it mean to us collectively and What would it mean to us collectively and
personally if we could improve our personally if we could improve our competitive position?competitive position?
What are we prepared to do, to get there?What are we prepared to do, to get there? ““Are we in this together? (the precondition Are we in this together? (the precondition
of strategy)” – David Maister of strategy)” – David Maister
Getting “Buy In”Getting “Buy In”
Staff Workshop – Part 2 – Blue Ocean Staff Workshop – Part 2 – Blue Ocean StrategyStrategy Theory of Blue Ocean StrategyTheory of Blue Ocean Strategy Current Factors of Competition in the IndustryCurrent Factors of Competition in the Industry The 4 Actions FrameworkThe 4 Actions Framework Your new Strategic Offering BundleYour new Strategic Offering Bundle
Making it RealMaking it Real
The work of taking the ideas and The work of taking the ideas and making them real:making them real: Operating procedures and policiesOperating procedures and policies PricingPricing Compensation implicationsCompensation implications Internal documentationInternal documentation Promotion plan, including marketingPromotion plan, including marketing LegalitiesLegalities
ConsistencyConsistency
““You can’t achieve a competitive You can’t achieve a competitive differentiation through things you do differentiation through things you do ‘reasonably well, most of the time.’” ‘reasonably well, most of the time.’” (David Maister, (David Maister, Strategy & the Fat Strategy & the Fat Smoker)Smoker)
ConsiderationsConsiderations
Change is never easy - old habits die hard, Change is never easy - old habits die hard, particularly with the more established particularly with the more established consultantsconsultants
Keys to success:Keys to success: An inside championAn inside champion Continual communicationContinual communication Consistent inspectionConsistent inspection Positive reinforcementPositive reinforcement Client QC calls on successful AND unsuccessful Client QC calls on successful AND unsuccessful
assignmentsassignments Formal review 3 months outFormal review 3 months out
SummarySummary
You CAN achieve long term You CAN achieve long term competitive differentiation (BRAND), competitive differentiation (BRAND), but it will take:but it will take: DreamingDreaming Discussion and buy-inDiscussion and buy-in Staff workStaff work Consistent deliveryConsistent delivery
““If you can dream it, you can do it” – If you can dream it, you can do it” – Walt DisneyWalt Disney
Dreams aren’t things to be wishes Dreams aren’t things to be wishes for, but worked for.for, but worked for.