1 Blue Ocean Strategy Ch 7 Overcome Key Organizational Hurdles Team IIICal WallaceM Isabel CastanedaPat McGregor
2 Overcome Key Organizational Hurdles The challenge of execution exists, and is a steep one.Managers face four hurdles:Cognitive: waking employees up to the need for a strategic shift.Limited ResourcesMotivationPolitics
3 The Four Organizational Hurdles to Strategy Execution
4 Tipping Point Leadership in Action New York City Police DepartmentExecuted a blue ocean strategy in the 1990s in the public sector.Bill Bratton appointed police commissioner in 1994. Faced opposition few executives ever faced.Crime was at an all time high.Less than two years and without any increases in the budget, Bratton turned NYC into the safest largest city in the US.
5 The Pivotal Lever: Disproportionate Influence Factors Fundamental changes can happen quickly when the beliefs and energies of a critical mass of people create an epidemic movement toward an idea.The 20:80 concept.
6 Breaking Through the Cognitive Hurdle In turnaround, and corporate transformations, the hardest part is making people aware of the need for a strategic change.Tipping point leadership does not rely on numbers to break through the organization’s cognitive hurdle.
7 Ride the “Electric Sewer” To break the status quo, employees must face the worst operational problems.Coming face to face with poor performance is shocking and inescapable.i.e. NYC Subway in 1990s
8 Meet with Disgruntled Customers To tip cognitive hurdle, you can not simply just get managers out of the office to witness the operational horror.Managers must also listen to disgruntled customers firsthand.i.e. Boston Police
9 Jump the Resource Hurdle Multiply vale of resources already haveFactors that Exec’s can leverage to free up resources:Hot SpotsCold SpotsHorse Trading
10 Jump the Resource Hurdle Cont Hot Spots- low resources but high potential performance gainsCold Spots- high resource input but low performance impactHorse Trading- Trading unit’s excess resources in one area to another’s to fill remaining resources gaps.
11 Jump the Resource Hurdle Cont Redirect Resources from Your Cold SpotsNY Transit policeFreeing up resources for use in Hot SpotsRedistribute Resources to Your Hot SpotNY Transit policeIncrease profits, increase costsTarget hot spots and force remained constant
12 Jump the Resource Hurdle Cont Engage in Horse TradingSkillfully trade resources not needed for those of others do needed.NY Transit policeTraded not needed excess patrol cars for much needed office space the other department did not need.
13 Jump the Motivational Hurdle How to motivate quickly and cheaply?Three factors of disproportionate influence:KingpinsFishbowl ManagementAtomization
14 KINGPINS Hone in on your natural leaders! “Those who are well respected and persuasive.” “Those who have ability to use or unlock key resources”Instead of motivating all to the change, its easier to move fewer.“Use the ripple effect”Example: NYPD motivating 76 precinct heads that have a ripple effect on their departments.
15 Kingpins in a Fishbowl Make these kingpins’s actions and non-actions visible to others.Question them in front of their peers and superiors.Gives an opportunity for achievers to gain the recognition.Use the “fair process”Engage and explain to allSet clear expectationsLevels the playing field for kingpins to advance or demote do to performance.Chapter 8 goes more in depth with fair process.
16 ATOMIZATION Unless the goal is seen as attainable, it usually is not likely to work.Make the actions in the vision framed by sections, or sectors.For example: By DepartmentBy PrecinctBy Division
17 Knock Over the Political Hurdle Politics are everywhere in business related activities!Influencing factorsLeverage AngelsSilencing DevilsGetting the consigliore on the top management.CONSIGLIERE:A politically adept but highly respected insider.Knows those that will fight you and who will support you.Example: Timoney knowing the political game in NYPD and reporting to Bratton.
18 Leverage Your Angels and Silence your Devils Who is an angel and who is a devil?Don’t fight alone.“Discourage the war before it begins. Know the angles of attack”“Anticipate the reaction”
19 Challenge Conventional Wisdom Transforming the masses uses time and resources.Execution by using tipping point leaders to use disproportionate influencers.Figure 7-3 page 169
20 Work Cited Kim, Mauborne, W., Renee (2005 ). Blue Ocean Strategy. Boston, Massachusetts: Harvard Business School Press.