Chapter 2: Analytical Tools and Framework

1. Chapter 2:Analytical Tools and Framework Team 6 Garrett Johnathan Alex Allison

2. Strategy Canvas • Compares core competencies for competition

3. Strategy Canvas in Blue Ocean • Focus on: • Move focus from competitors to alternatives • Move focus from customers to noncustomers • Don’t Focus on: • Offer more for less • Choose between differentiation and cost leadership

4. The Four Actions Framework

5. The Four Actions Framework • Eliminate- the first question ask you to look at your competition and how you can eliminate factors that you have long competed on • Reduce- this factor forces you to look at overdesign of product and over serving customers • Raise- here you must eliminate compromise • Create- discover new sources and create new demand

6. [yellow tail]’s Framework Eliminate Reduce Wine complexity Wine range Vineyard prestige • Wordy terminology / distinctions • Aging quantities • Above-the-line marketing

7. [yellow tails]’s Framework Raise Create Easy drinking Ease of selection Fun and adventure • Price versus budget wines • Retail store involvement

8. Subway’s Framework • Eliminate • Unhealthy atmosphere • Raise • Food standards • Reduce • Sugary drinks, fatty sandwiches • Create • Fresh fit combo meal

9. Three Characteristics of a Good Strategy [yellow tail] • Focus • Easy Drinking, Ease of Selection, Fun/Adventure • Divergence • Set themselves apart as a new, laid back wine • Compelling Tagline • “Go-To” • Conveyed as America’s go to wine • No knowledge of classified wine necessary

10. Three Characteristics of a Good Strategy • Focus • Divergence • Compelling Tagline • These serve as an initial litmus test of the commercial viability of blue ocean ideas

11. FOCUS • Identify key factors of competition • EX: Southwest Airlines • Quality, Speed, Price, Innovation… • Choose on factor • Focus on that one factor

12. DIVERGENCE • Break out of the common competing Techniques • Price wars, meals, seating • Revolutionize the industry • Point-to-point travel between midsize cities • Previously: hub-and-spoke systems • Make changes to the way things done in the industry • EX: Southwest Airlines

13. COMPELLING TAGLINE • “The speed of a plane at the price of a car-whenever you need it.” • What is a tagline? • A short descriptive phrase • Tagline should be: • Short and Clear • Truthful • Updated • EX: yellowtail • A fun and simple wine to be enjoyed every day

14. The Strategy Canvas

15. Reading the Value Curves • 1st question value curves answer is does the company deserve to be a winner? • Does it meet the three criteria: focus, divergence, and compelling tagline • A business does not want it’s value curve to converge with that of its competitors • Does your company’s value curve show high levels across all factors?

16. Reading the Value Curves • Incoherent strategy: company does not have one main goal, but has many independent sub strategies • Are there strategic contradictions? • Is your company internally driven? Inside-out strategy or outside-in strategy?

17. Key Points • Diagnostic and Action Framework for building a compelling strategy • Create unique identity and value • Use the Four Actions Framework to create a new value curve • Focus on one key competitive factor and differentiate yourself from your industry • Using the value curve can help reveal strategic information that can aid a company in gaining market share and becoming a powerhouse in their industry