2. HYPOTHESIS: STUCK
IN THE MIDDLE
The firm stuck in the middle is almost guaranteed
low profitability. It either loses the high-volume
customers who demand low price or must bid
away it profit to get this business away from low
cost firms. Yet it also loses high-margin targets -
the cream – to the firms who are focused on high-
margin targets or have achieved differentiation
overall.
The firm stuck in the middle also probably suffers
from a blurred corporate culture and a conflicting
set of organizational arrangements and motivation
system
M.E. Porter
Strategic
advantage
Strategictarget
Industrywide
Particular
Segment Only
Uniqueness Perceived
by the customer
Low Cost Position
Differentiation Overall Cost
leadership
Focus
What is the potential of the business?
3. THE QUEST FOR
COMPETITIVENESS
Restructuring the Portfolio and
Downsizing Headcount
Smaller
Reengineering Process and
Continuous Improvement
Better Different
Reinventing Industries and
Regenerating Strategies
The Quest for
Competitiveness
Fat Lazy Blind
Pursue differentiation and low cost to break the value-cost-
trade-off
4. CONSIDER
Low cost position may well be crucial, but low-cost position overall is not
necessarily important or the only way to compete.
Arching low-cost position overall often involves a sacrifice in other areas of
strategy, like differentiation, technology, or service on which other competitor
strategic are based.
But…
Competing on bases others than low cost must be constantly aware of the
differential between their cost and those of the overall low-cost strategic
competitors.
Although Vision is a scarce commodity, structural analysis can help direct
thinking toward the areas of change that would yield the highest payoff.
… Value Innovation …
5. GENERIC FRAMEWORK OF THE
STRATEGY MACHINE
The level of serial movements has an
impact of the total quality. The needed
Quality define the elements of each the
serial level.
Map of
strategy
space instead
of price and
volume
Consolidation Formulation FinalisationFocus
Comprehension Consensus Consequences Commitment
Structuring the existing
Data/ Information with
the “Competitors
response profile’s”
Build up Competitive
strategic framework
Identify Information
lacks
Define the vital
Dimensions of
Competitive Strategy
Characterising the
Strategic Groups
Customer Equity,
Customer Life time
Value
The Implication for
Formulation of
Strategy
Formulation of Vision,
and Goal.
Hand over to the BSC
process
6. STRATEGY MACHINE –
DESCRIPTION OF LEVEL
• Level 1: Key Machine Modules
• Level 2: Detail the Modules
• Level 3: Module Elements
A
A1 A2
A1.1 A1.2 A1.3
The goal is a transformation process that is revolutionary in result, but evolutionary in
execution
7. THE QUALITY LEVERS
OF “STRATEGY”
If your company's strategic profile does not clearly reveal those qualities, your
strategy will likely be muddled, undifferentiated, and hard to communicate
Levers Drivers
A Company characteristic profile
Own Agenda
Low cost and simplify the business
Strategic profile
Emphasise only few factors – Low Cost
Four action Framework
New competitor factors
Differentiate the profile (from the industry
average profile)
Strategy Canvas among industry player
Truthfully
Strong and Authentic
Trust and interest for Customer
Clear cut out
Clear message
Advertise an offering
Elimination
Raising
Reducing
Creating
Differentiate value Curve within the industry
Drawn factors form alternative industry
Focus
Divergence
Compelling
Tagline
8. STRATEGY MACHINE –
LEVEL 1
Consolidation
Visual Awakening
Focus
Visual Exploration
Formulation
Strategy Fair
Finalisation
Visual Communication
Synthesized the future value
curve: Draw your "to be" strategy
canvases based on insights from
field observations. Get feedback
on alternative strategy pictures
from customers, lost customers,
competitors' customers, and non-
customers. Use feedback to build
the “Best to be" strategy.
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Levelbefore
Levelafter
Low
High
Low
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Levelbefore
Levelafter
Low
High
Low
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Levelbefore
Levelafter
Low
High
Low
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Levelbefore
Levelafter
Low
High
Low
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Levelbefore
Levelafter
Low
High
Low
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Levelbefore
Levelafter
Low
High
Low
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Level before
Level after
Low
High
Low
Distribute your before-and-after
strategic profiles on one page
for easy comparison.
Support only those projects and
operational moves that allow
your company to close the gaps
to actualize the new strategy.
Design Stairway to Value
innovation
Visualizing Strategy at the
Corporate Level / BU
Create the new Portfolio Map
(PMS) and Focus activities
Flesh out the founded strategy
and validate the ideas to
ensure their commercial
viability.
It shows the strategic profile of an
industry by depicting very clearly
the factors that affect competition
among industry players
The basic component is the value
curve. Which shows the strategic
profile of current and potential
competitors, identifying which
factors they invest in strategically
The factors of competition for the
industry are listed on the
horizontal axis. The vertical axis
indicates the degree to which the
company and the providers of
alternative services invest in the
competitive factors.
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Level before
Level after
Low
High
Low
Inputs:
• Customer/ User List
• Competitor Profile
• Factor list
Outputs
• Value curve
Inputs:
• Customer/ User needs
• Different point of view of a new
strategy
Outputs:
• Different potential value curve
The way is to catch the resolving
differences of opinion about the
current state of play.
Inputs:
• Six path Framework
• Field observations
Outputs:
• Validate Strategy canvas
• Vision,
• First draft of Goals and
Objective
-+--
Have you addressed adoption hurdles up
front
Adoption
-+--
Does you cost structure meet the target
cost
Cost
+-+++
Is your price easily accessible to the
mass of buyers?
Price
-++-
Is there exceptional buyer utility in your
business idea? Are there compelling
reasons to buy you offering?
Utility
Competitor 3Competitor 2Competitor 1CompanyQuestion
-+--
Have you addressed adoption hurdles up
front
Adoption
-+--
Does you cost structure meet the target
cost
Cost
+-+++
Is your price easily accessible to the
mass of buyers?
Price
-++-
Is there exceptional buyer utility in your
business idea? Are there compelling
reasons to buy you offering?
Utility
Competitor 3Competitor 2Competitor 1CompanyQuestion
Value Curve Before/ After
tbd1 tbd1 tbd1 tbd2 tbd3 tbd4 tbd5 tbd6 tbd7 tbd8 tbd9 tbd10 tbd11 tbd12
Level before
Level after
Low
High
Low
Inputs:
• The future strategy canvas
Outputs:
• Company strategy
• Action plan
• Strategic aligned action map
• Communication model
• Prepare BSC
Draw the company's strategic
profile or value curve showing
how it invests in the factors of
competition and how it might
invest in them in the future.
Discover the adoption of hurdles
for non-customers.
Observe the distinctive
advantages of alternative
products and services.
See which factors you should
eliminate, reduce, raise and
create (ERRC).
