BLUE OCEAN STRATEGY

ASSIGNMENT 3 (INDIVIDUAL)

1) Four types of organizational hurdles:

After developed a blue ocean strategy with a profitable business model, the next
challenge that a company would face is strategy implementation. There are four
organizational hurdles. (Blue Ocean Strategy & Shift Tools)

The first one is, the cognitive hurdle. Waking employees up to the need for a strategic
shift. Red oceans may not be the paths to future profitable growth, but they may have served
the organization well historically, employees may thinks that it does not need a change.
Cultural change is almost always considered to be the biggest problem when looking at
significant strategic change. People, usually the most valuable asset, on the whole find it
difficult to change. Simply telling them that the ‘numbers do not add up’ often provokes an
opposite reaction to the one desired. People working for a company that outwardly states they
are going down the pan are more likely to look at job adverts than work to save the company.
More often, they will tend not to believe the numbers anyway. Numbers are too remote to act
as agents of change.

The second is limited resource hurdle. It is assumed that the greater the shift in
strategy, the greater the resources it requires for implementation. But resources were being
cut, and not raised, in many of the organizations we studied. Once an organisation can see the
reality of the need for strategic change, it will almost always look towards bigger budgets to
resolve the problem. If customer service is poor, then add more customer service
representatives. If sales are low, then add more salespeople. A tipping point leader will focus
hard on the resources available and apply the 80-20 rule. 80% of the benefit can be gained
through focus on 20% of the problems.

Third, the unmotivativated staff. It is how we motivate key players to move fast and
tenaciously to carry out a break from the status quo. How do you motivate key players to
move fast and tenaciously to carry out a break from the status quo? That will take years, and
managers don’t have that kind of time. Motivating staff to accept strategic change has always
been considered a priority. Making them aware of the strategy is the first problem, let alone
getting them to the point where they agree with it. Strategy is often seen as a remote activity

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created by people in ivory towers that do not understand the business. A tipping point leader
will not look to create informational campaigns or masses of documentation.

The last one is the political hurdle which is opposition from powerful vested interests.
Corporate politics as people attempt to preserve their personal fiefdoms. As one manager put
it, “In our organization you get shot down before you stand up”. By having someone on the
leadership team that has an intimate knowledge of the workings of the organisation and its
people, a tipping point leader can gain valuable information about levels of support. The key
is to deal with dissenters early. Either through appeasement, that is by ensuring they
understand what their new role will be and ensuring they buy-in to it or by release, that is to
let them go early in the knowledge they will not provide a positive influence. These can be
tough decisions, but the need to be made early.

Although all companies face different degrees of these hurdles, and many may face
only some subset of the four, knowing how to triumph over them is key to attenuating
organizational risk. This brings us to the fifth principle of blue ocean strategy which is
overcome key organizational hurdles to make blue ocean strategy happen in action.

2) Ways to overcome the hurdles:

Companies must abandon perceived wisdom on effecting change to achieve this effectively.
Conventional wisdom asserts that the greater the change, the greater the resources and time
you will need to bring about results.

(a) Cognitive Hurdle

The way to convince people of the need for substantive change, you have to ensure a
change in mind set that is internally driven of people’s own accord. People remember and
respond most effectively to what they see and experience, the old adage of seeing in believing.
People must see the harsh reality first-hand if they are to accept the need for change, a reality
that can be experienced in a number of ways. The first is to come face to face with the worst
operational problems, to experience what your customers experience by going through what
they do when dealing with your organisation. The second is for you to listen to your
customers, meeting them face to face and being receptive to their comments, not
defensive. The goal is to listen and learn, not defend the company’s actions.

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(b) Resource Hurdle

Resources are multiplied through three mechanisms: identifying hot spots, identifying
cold spots and horse-trading. Overcoming the resource involves redistributing resources to
your hot-spots, redirecting resources from your cold-spots and engaging in horse-trading to
trade those resources they don’t need for those that they do need with other units within the
organisation.

(c) Motivational Hurdle

For a new strategic to take on a life of its own, people must recognise what needs to
be done and act on the insight in a sustained and meaningful way. To make this happen, it
requires intense focus rather than top-down change programmes. This entails focusing on
three key factors of disproportionate influence which are kingpins, fishbowl management and
atomisation. For strategic change to have real impact, employees at every level need to
change together but your activities to make this happen should be focused on a small number
of key influencers, known as the kingpins. In order to ensure that the kingpins are motivated
in a sustained way, fishbowl management is used to shine a spotlight on their actions, making
their activities visible to others. For fishbowl management to work, it must be based on
transparency, inclusion and fair process.

(d) Political Hurdle

To overcome political hurdles, company need to focus on three influencing factors which are
leveraging the angels, silencing the devils and placing a consigliere on the management team.
The key message in overcoming the political hurdles is not to fight alone. Identify both
supporters and detractors, forget the middle, and strive to create a win-win outcome for both
sides. It is important to isolate your detractors by building a broad coalition with your angels
before the war starts. To overcome this hurdle, leaders should ask, Who will fight me and
who will align with the new strategy? Have I built coalitions with natural allies to ‘encircle’
dissidents? By focusing on three disproportionate influence factor which are leveraging
‘angels’, silencing ‘devils’ and getting a consigliere on the top management team, leaders
can leap over the political hurdle.

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3) Difference of tipping point leadership and conventional wisdom:

The conventional theory of organizational change rests on transforming the mass. So

change efforts are focused on moving the mass, requiring steep resources and long time
frames. (Tipping Point Leadership)

Tipping point leadership takes a reverse course. To change the mass it focuses on
transforming the extremes which includes the people, acts, and activities that exercise
a disproportionate influence on performance. By transforming the extremes, tipping point
leaders are able to change the core fast and at low cost to execute their new strategy. Tipping
point leadership allows you to overcome these four hurdles fast and at low cost while
winning employees’ backing in executing a break from the status quo.

Conventional The theory of organizational change rests on transforming the mass and
Wisdom these efforts require steep resources and long timeframes.

Tipping Point To achieve a strategic shift at low cost, focus on the extremes – the people,
Leadership acts, and activities that exert a disproportionate influence on performance.

Hence, differ to conventional wisdom, mounting a massive challenge is not about

putting forth an equally massive response where performance gains are achieved by
proportional investments in time and resources. Rather, it is about conserving resources and
cutting time by focusing on identifying and then leveraging the factors of disproportionate
influence in an organization.

4) Important factors in strategy execution of Blue Ocean Strategy:

For a company to successfully shift from red oceans to blue oceans, Chan Kim and Renee
Mauborgne have identified three key components that are needed which are adopting a blue
ocean perspective, having tools and methodology for market creation, and having a
humanistic process. (Blue Ocean Stratefy & Shift Tools)

Adopting a blue ocean perspective

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 The first component is adopting a blue ocean perspective so that you expand your
horizons and shift your understanding of where opportunity resides. Adopting the perspective
of a blue ocean strategist opens your mind, instead of limiting it to what is. It expands your
horizons and ensures that you are looking in the right direction. Without expanding and
reorienting your perspective, striving to open up a new value-cost frontier is like running
west looking for the sunrise. No matter how fast you run, you’re not going to find it.

Practical tools for market creation

The second component, which is having practical tools for market creation with
proper guidance on how to apply them to translate a blue ocean perspective into a
commercially compelling new offering that creates new market space. If the right perspective
is a matter of shifting one’s strategic thinking by asking different questions, market-creating
tools and guidance enable you to ask the right questions at the right point in the process and
to see the significance of the answers. They guide you step by step through the
central questions for opening up a breakthrough value-cost frontier. These tools and
frameworks so powerful because they are visual, which renders them easy to understand and
apply, no matter what an individual’s level of education or creativity.

A humanistic process

The third component is having a humanistic process, something we have come to call
“humanness” in the process, which inspires and builds people’s confidence to own and drive
the process for effective execution. Most organizations face internal hurdles to change. This
might be a cognitive hurdle because people are wedded to the status quo. Political hurdle
created by deep divisions that breed internal tensions and infighting. Or a motivational hurdle,
because people focus on doing what it takes to get by, but lack the energy, passion, and drive
to make a real difference. Instead of treating execution as something that happens after the
strategy has been set, it needs to be built into the strategy from the start or people won’t own
it. If you can move people by inspiring and building their confidence to own and drive your
new strategy, they will be committed to seeing change through and overcoming the
organizational constraints you confront.

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5) Concept of procedural justice:

Procedural justice or also known as procedural fairness is defined as the fairness of

processes used by those peoples that has authority to reach certain outcomes. Procedural
justice affects how decisions are made and policies are established. It is based on the premise
that the most fair and respectful decision will be made. Procedural justice is also concerned
about creating policies and procedures that take all perspectives and concerns into
consideration. When a situation cannot be resolved between the parties, and a leader or
manager is required to make a ruling, procedural justice suggests that decisions be neutral,
based on fact and appropriate for the actions. Procedural justice is the idea of fairness in the
processes that resolve disputes and allocate resources. One aspect of procedural justice is
related to discussions of the administration of justice and legal proceedings.

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 When employees believe problems will be resolved fairly and honestly, they will have
more confidence in the decision. One of the component is the quality of decision-making
procedures, where a power holder intervenes in a situation and gives citizens the voice rights
to express their point of view, behaves in a professional and unbiased manner, and perceived
to be competent in the way he or she resolves the situation. The second component focuses
on the quality of treatment, where assessments are made as to whether the power holder has
treated a person with dignity and respect. Both components need to be exercised for
procedural justice to be delivered. These two components are often operationalized into four
key constructs of procedural justice which are voice, trustworthy motives, dignity and respect,
and neutrality in decision making.

Procedural justice speaks to four principles, often referred to as the four pillars which
area; 1) being fair in processes, 2) being transparent in actions, 3) providing opportunity for
voice, and 4) being impartial in decision making. The perceptions of fairness are driven not
only by outcomes but also by the fairness and consistency of the processes used to reach
those outcomes. But the four principles are not stand alone, they support one another. The
process of decision making also requires transparency and openness which is, decisions
should unfold out in the open as much as possible, and the reasoning behind decision making
should be explained clearly when appropriate.

People want an opportunity not only to understand what is happening but also to feel
they have an opportunity for voice to ensure their side of the story is heard. Nobody likes to
feel their future is being decided upon by another person. Rather, people want voice or
representation in decisions that may directly affect them. We all want decision making to be
guided by impartiality, ensuring that biases did not influence the decision and ultimately the
outcome. When the four pillars of procedural justice are embraced. It is beginning with the
executive leadership and continuing down through sworn and civilian supervisors. It may
ultimately have an impact on the way front line officers and civilian personnel interact with
the public. Procedural justice is a concept that promotes positive organizational change,
bolsters better relations with the community, and enhances officers’ and civilian employees’
safety.

There are two areas of procedural justice as it applies to law enforcement which are
internal and external. Internal procedural justice refers to the officers’ perceptions of their
colleagues’ actions which particularly those of their supervisors are fair and understandable,

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which demonstrates a key level of respect. Research on internal procedural justice indicates
that officers who feel respected by their supervisors are more likely to understand why
decisions were made. They were more likely to accept, support, and voluntarily comply with
those decisions, including departmental policies and less likely to challenge the decisions.
Additionally, officers will be happier at work, feel a greater sense of self worth, and are more
willing to go the extra mile for the agency because they have a deeper connection to the
agency’s mission and vision. This demonstrates that people are more willing to make
sacrifices if the process is perceived to be procedurally justice and if they are shown respect.
(Procedural Justice)

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REFERENCES

Blue Ocean Strategy & Shift Tools. (n.d.). Retrieved 7 May, 2019, from Blue Ocean:
https://www.blueoceanstrategy.com

Procedural Justice. (n.d.). Retrieved 5 May, 2019, from Trust & Justice:
https://trustandjustice.org

Tipping Point Leadership. (n.d.). Retrieved 5 May, 2019, from Advantex 360:
https://www.advantex360.com.au