Unvelling the Power of Strategy Canvas and Four Actions Framework

In the dynamic landscape of business, staying ahead requires not only a keen understanding of your industry but also the ability to craft and implement innovative strategies.

Two tools that have gained prominence in the realm of strategic management are :

• • Strategy Canvas
  • The Four Actions Frameworks

These frameworks are developed by renowned business scholars W. Chan Kim and Renee Mauborgne in their groundbreaking book “Blue Ocean Strategy“, the tools provide a structured approach to creating value and differentiating your business in a crowded marketplace.

The Strategy Canvas

A Strategy Canvas is a visual representation that captures the current state of competition within an industry. It displays the key factors that competitors compete on and the degree to which they invest in each factor. The canvas allows businesses to assess their strategic position relative to their competitors.

Components of a Strategy Canvas

1. 1. Key Factors: Identify the key factors or dimensions that customers value in your industry. These could include price, quality, speed, flexibility, and more.
   2. Competitive Profile: Plot the competitive profile of your business and your competitors on the canvas. Use a simple visual representation, such as a line graph, to illustrate the level of investment or performance in each key factory.
   3. Blue Ocean vs Red Ocean: A red ocean represents a crowded marketplace where competition is fierce, and differentiation is challenging. A blue ocean, on the other hand, symbolizes untapped market space with the potential for innovation and differentiation.

How to use a Strategy Canvas

1. 1. Identify Key Factors: Understand the factors that are crucial in your industry and determine which ones matter most to your customers.
   2. Plot Current State: Map the current state of your business and competitors on the canvas. Analyze the strengths and weaknesses of each.
   3. Strategic Insights: Identify areas where your business can create distinctive offerings or where you can reduce investment in factors that are less critical to customers.

The Four Actions Framework

The Four Actions Framework is a complementary tool to the Strategy Canvas. It challenges businesses to break away from industry norms and create new value curves by asking four fundamental questions.

1. 1. Which factors should be reduced well below the industry standards?
   2. Which factors should be eliminated that the industry has long competed on?
   3. Which factors should be raised well above the industry’s standards?
   4. Which factors should be created that the industry has never offered?

Applying the Four Actions Framework

1. 1. Reduce: Identify and streamline factors that are overemphasized in the industry. This might involve eliminating certain product features or services that do not significantly contribute to customer satisfaction.
   2. Eliminate: Challenge the status quo by questioning the necessity of certain industry practices. If a factor is not contributing significantly to customer value, consider eliminating it.
   3. Raise: Identify factors that are crucial to customer satisfaction but are not being adequately addressed by competitors. Elevate these factors to exceed industry standards and stand out in the market.
   4. Create: Innovate by introducing entirely new factors that the industry has not considered. This involves thinking beyond existing boundaries to provide unique value to customers.

Integrating Strategy Canvas and Four Actions Framework

1. 1. Analyze and Reflect: Use the Strategy Canvas to analyze your industry’s current state, and then apply the Four Actions Framework to challenge and reshape your strategic approach.
   2. Create a New Value Curve: By reducing, eliminating, raising, and creating factors, you can develop a new value curve that positions your business in a blue ocean of uncontested marketplace.
   3. Implement and Iterate: Implement the strategic changes derived from the analysis and continually iterate based on market feedback and evolving industry dynamics.

In a world where competition is fierce, the Strategy Canvas and the Four Actions Frameworks provide a structured approach to strategic innovation. By understanding the current competitive landscape and challenging industry norms, businesses can carve out their unique space in the market, unlocking opportunities for growth and sustained success. Embrace these tools, break free from the red ocean, and set sail into the unchartered waters of the blue ocean strategy.