Competing Factors Table (AS IT Strategy)

BUSINESS PRICE QUALITY TASTE AVAILABILITY MARKETING KFC Mc Donald Hardees 25 80 50 80= High 50=Medium 25=Low 50 80 25 80 80 25 80 50 25 50 80 50

HYIGENIC ENVIRONMENT FOOD 80 50 25 50 80 50

90 80 70 60 50 40 30 20 10 0 PRICE

QUALITY

TASTE

AVAILABILITY

MARKETING

HYGENIC FOOD

ENVIROMENT

KFC

MC DONALD

HARDEES

Companies which are focused on benchmarking and continuous improvement, instead of on continuous redefinition of their business and search for blue oceans, run a deadly risk: They could be best at what they do, yet become irrelevant to the world.

Blue Ocean Strategy:

This strategy is introduced by Prof.Chan Kim and Rene Mauborgne in 2005. According to there research the high growth and profits of an organization can generate by creating new demand in an uncontested market space, or a "Blue Ocean", than by competing head-to-head with other suppliers for known customers in an existing industry. So the main points of this strategy is Moving into untapped or uncontested markets (blue oceans) is a preferable strategy to fighting it out in saturated markets (red oceans). Innovation is the key to creating blue oceans. Create something that is new, and you will reap the rewards The Six Principles of Blue Ocean Strategy

Formulation principles

Risk factor each principle attenuates

Reconstruct market boundaries Focus on the big picture, not the numbers Reach beyond existing demand Get the strategic sequence right Execution principles Risk factor each principle attenuates

Overcome key organizational hurdles Build execution into strategy

Applying Blue Ocean Strategy:

1. As it strategy 2. Using ERRC (Four Action Framework)

As It Strategy:
In as it strategy we will analyze the existing or current strategies of the industry. So our industry is fast food industry and we have selected the KFC for our project. The competitors of our company are Macdonald and Hardees we have selected and draw on the as its strategy canvas on the bases of these competing factors. Price Quality Taste Availability Marketing of Products Hygienic Food Environment After the as it is strategy we have come to know that where we are in the market (existing market).Now we select the non customer of our products (Which People who are not our customers).So we will use the ERRC Grid for change in our products and capture the noncustomers

The Four Actions Framework ERRC Grid for KFC:

Eliminate
Marketing Availability

Rise
Quality Enviroment

Four Action Framework

Reduce fats and oil Create
Low calories product

The Four Actions Framework:

To reconstruct buyer value elements in crafting a new value curve, we have developed the four actions framework. To break the trade-off between differentiation and low cost and to create a new value curve, there are four key questions to challenge an industrys strategic logic and business model:

Which of the factors that the industry takes for granted should be eliminated? Which factors should be reduced well below the industrys standard? Which factors should be raised well above the industrys standard? Which factors should be created that the industry has never offered?

The first question forces you to consider eliminating factors that companies in your industry have long competed on. Often those factors are taken for granted even though they no longer have value or may even detract from value. Sometimes there is a fundamental change in what buyers value, but companies that are focused on benchmarking one another do not act on, or even perceive, the change. The second question forces you to determine whether products or services have been overdesigned in the race to match and beat the competition. Here, companies over serve customers, increasing their cost structure for no gain. The third question pushes you to uncover and eliminate the compromises your industry forces customers to make. The fourth question helps you to discover entirely new sources of value for buyers and to create new demand and shift the strategic pricing of the industry. It is by pursuing the first two questions (of eliminating and reducing) that you gain insight into how to drop your cost structure vis--vis competitors. Our research has found that rarely do managers systematically set out to eliminate and reduce their investments in factors that an industry competes on. The result is mounting cost structures and complex business models. The second two factors, by contrast, provide you with insight into how to lift buyer value and create new demand. Collectively, they allow you to systematically explore how you can reconstruct buyer value elements across alternative industries to offer buyers an entirely new experience, while simultaneously keeping your cost structure low. Of particular importance are the actions of eliminating and creating, which push companies to go beyond value maximization exercises with existing factors of competition. Eliminating and creating prompt companies to change the factors themselves, hence making the existing rules of competition irrelevant. When you apply the four actions framework to the strategy canvas of your industry, you get a revealing new look at old perceived truths.