Got Likes, Tweets and Follows...then You don't have Jack for Strategy! (EP06) - a podcast by David Darab, DDS, MS, MBA

Today there is a new Strategy framework that is growing in popularity called Blue Ocean Strategy. I wish to introduce some of its Ideas here. This is an improved alternative to the intense industry competition and rivalry of Red Oceans. Blue Ocean Strategies emphasize Creating Not Competing, Creating New Market Space and Not Competing in the existing space. Again, Create don’t Compete.

Value Innovation is the Cornerstone of Blue Ocean Strategy. Value innovation reduces Cost by Eliminating and Reducing factors not needed or desired by customers, while simultaneously raising customer value by creating elements the industry has never offered. This combines what previously had been considered impossible; lowering cost and improving value. In the old strategy framework, great value could be created only by adding more features with more cost. If one desired to be the low-cost provider, features had to be removed so costs could be cut.

Consider what follows to be a Primer on Blue Ocean Strategy. The listener is directed to 2 books that outlines well this Framework, the first is Blue Ocean Strategy and the newest edition, Blue Ocean Shift. I would rank these book as essential reading, you will not be disappointed, I promise!

The Blue Ocean website has volumes of information and examples too.

We have already introduced Value Innovation as the Cornerstone of Blue Ocean Strategy. Value Innovation lowers cost by eliminating and reducing non-essential factors while simultaneously raising and creating new ones the industry has not offered.

This is best visualized by drawing a Strategy Canvas, one of the first steps in the Blue Ocean Journey.

A strategy canvas shows :

1.  the strategic profile of an industry by depicting the current competing factors and possible future factors.

For example in dentistry competing factors could include, price, convenience, location, office environment, services offered, availability of appts, payment options, technology, insurance plans accepted, cosmetic dentistry, future factors might include a treatment guarantee, treatment outcome data, along with Comprehensive Multidisciplinary Team Treatment

2.  Next, the strategic profile of current and potential competitors are charted, helping to identify which of the competing factors they invest in.

Potential Competitors could include Corporate or Large Group Practice, Single Family Dental Practice along with a High Touch Esthetic and Cosmetic Practice. If you perform specialty procedures then other specialists could be competitors.

3.  Finally, A To-Be Strategy Canvas is created which shows which key resources you will focus on to create a value curve that diverges from your competitor's offerings.  A  compelling tagline is then created that distills this strategy into words that can capture people’s imagination.

Another revealing exercise is the 4 Actions Framework, the hallmarks here are Eliminate, Reduce, Raise and Create.

*Eliminate- for these factors taken for granted, that create no value should be eliminated- I don’t have a good example of these, maybe you can think of one do!

*Reduce- here, one seeks to reduce pain points which the industry ignores- multiple forms to fill out, wait times for appts.

*Raise- means just that, raising or improving above industry stand- payment options, insurance plans, comprehensive services, expanded hours, the predictability of tx,

*Create- creating factors never offered before- treatment guarantee/warranty, treatment outcome data, Multidisciplinary Team Tx that freely shares patient information, a mobile portal, virtual consults.

The Four Actions Framework eliminates factors that do not add value for buyers, reduces factors that have been overdesigned, raises factors that are highly valued by buyers and creates new factors that had previously never been considered or offered.

The Blue Ocean Framework will also cause you to look at yourself, your practice and your markets differently.

Other ideas to consider and questions to ponder, the answers to which are important to unlocking the greatest value for your patient/customers.

1.  Why don’t patients choose you or your practice?  If they leave did they trade up or trade down and why?

2.  Who are your customers?  Who are your stakeholders? We immediately think of the patient, but one must think much differently.  For many patients it is their employer who has purchased their insurance, could also be a parent or grandparent helping a family member.  The front office staff of your specialist offices can function as both customers, receiving referrals, as well as a source or supplier of new patients for your practice.

3.  What if you shifted your focus from just the patient to some of these other groups?  Could unique value radically different from that presently offered be created?  Think of the possibilities!

4.  Do you Provide a Total Solution for your patient/customer?  The simplest way to do this is to think about what happens to your patient before, during and after your service.  The more of a one-stop, bundled service you can provide, the greater the convince and hence the greater the value to your customer.  Maybe you should provide the products you recommend in your office and eliminate your patient having to shop for them.  Compliance will more than likely do up!

5.  Solve your customer's major pain points.  Understand what they are!  Every pain point is an opportunity to unlock hidden value and create new demand.  These pain points are the reasons why customers are dissatisfied and buyers refuse to participate. In the blue ocean shift process, pain points are blatant opportunities to change the playing field fast.

6.  Think across time trends.  What trends have a high probability of impacting your practice, are irreversible and are evolving in a clear trajectory?  Certainly, Corporate Dentistry is one trend, digital dentistry is another.  How will these trends impact you? Given this, how can you open up unprecedented customer utility?

3 Factors of Good Strategy include

1. FOCUS

2. DIVERGENCE- value curves stand apart

3. COMPELLING TAG LINE- clear and truthful message

Finally, avoid Red Oceans which includes;

1.  Conventional thinking.
2.  Focusing on being the best.
3.  Focusing on the same buyer group.
4.  Defining the scope of service offerings similarly.
5.  And Focusing on current competitive threats.

https://www.blueoceanstrategy.com/

https://www.isc.hbs.edu/about-michael-porter/Pages/default.aspx

Further episodes of The Beacon-Podcasting for Dentists

Further podcasts by David Darab, DDS, MS, MBA

Website of David Darab, DDS, MS, MBA