How to present a strategy visually: try a “Strategy Canvas”
Getting buy-in for a new strategy is difficult. Often we present vast swathes of data, colourful graphs and pages of text to convince our audience of how brilliant our strategy is and to show how much hard work we have done. To communicate strategy effectively however, it simply needs to be clear and concise. So, how can we best present a clear strategy and communicate it to an audience?
A well-known phrase in the UK is, “a picture paints a thousand words”. In this regard, one of my favourite ways to communicate a strategy is using a strategy canvas. Steven Yeo, COO of HPS Pharmacies in Australia, and fellow MBAer, introduced it to me. We were taking part in the European Summer School of Advanced Management (ESSAM), in Aarhus, Denmark. Steven suggested that we present our new strategy to our client, CBMI, in the form of strategy canvas. I’d never heard of this approach at the time. However, every time I’ve presented a strategy canvas since, it has proved to be a winning formula. Hence I’d like to share it with you.
The concept was developed by Kim and Mauborgne (2002) and published in the Harvard Business Review under the title, “Charting Your Company’s Future”. The study focused on helping a team of senior executives from a struggling firm develop a new strategy. The new strategy resulted in an increase of overall revenues of over 30%.
Drawing a Canvas
So how did they do it? Firstly, Kim and Mauborgne, gathered the senior executives together and showed them how to draw a strategy canvas. They were asked to select the most important value drivers for the firm, or “factors of competition”, placing these criteria on the x-axis. On the y-axis was a scale “high or low” denoting how much the firm invests or provides (in terms of price) in this area. Once the criteria had been selected, the strategy canvas depicting the firm’s existing strategy was drawn.
Add Competing Strategies
Next, on the same canvas, the senior executives were asked to draw the strategies of competing financial services firms. The completed canvas showed in simple graphic form how their company’s offer differentiated, or was similar to, their competitors.
Get Customer Feedback
Kim and Mauborgne’s next step for the senior executives was to ask customers which of the criteria (x-axis) on the canvas were important to them. This gave insight into the areas which a new “customer focused” strategy should concentrate. Combining the two sets of data enabled the senior executive team to create a new strategy that was both customer focused and differentiated.
Create Differentiated Strategy & Communicate it
Having created the new strategy, and a strategy canvas to go with it, the senior executive team then used the canvas to communicate the idea to the rest of the firm. The strategy canvas was widely circulated, pinned on notice boards etc and became a reference point on which investment decisions were made.
I’ve used an approach similar to this many times. I find it a great way of presenting a strategy in a simple format. Kim and Mauborgne’s 4 step process of how you can create a strategy canvas is presented below. Following this I’ve shown you the strategy canvases of two case studies in which I’ve used this technique.
Kim and Mauborgne (2002) 4 step process:
1. “Visual Awakening” – shows your current strategy in relation to your competitors
2. “Visual Exploration” – ask your customers what is important for them, explore new products and services, which factors can you change?
3. “Visual Strategy Fair” – Get feedback on potential strategies from customers past, present and competitors if needed. Using this feedback you create your new strategy.
4. “Visual Communication” – show a before and after profile on the same graph to show your audience where change is occurring. Any changes in the business have to fit into this new profile.
Case Study 1: CBMI (ESSAM consultancy project)
We presented a “visual awakening” strategy canvas to the team at CBMI (dark blue line). Our aim in this consultancy project was to look at ways of creating additional income streams for the business. Our canvas showed how CBMI and competitor innovation networks had different business models and offered diverse customer value propositions. CBET (green line), a Canadian entity, exhibited best practice networking amongst the analysed group and arguably provided a source of value that enabled CBET to charge its members and therefore provide incremental income. The canvas clearly showed CBMI in which areas it could improve.
Case Study 2: Bally Shoes (Southampton University MBA Strategy Presentation)
A further example when I’ve used a strategy canvas was for an MBA project based on an IMD case study of Bally shoes. Here we presented our findings on the strengths and weaknesses of the shoe retailer in relation to its competitors. The strategy canvas enabled us to present the relative strengths of Bally (red line) in the areas of Distribution & Retail and Quality. However it also enabled us to highlight the company’s relative weakness in the area of Style, Marketing & Comms, Supply Chain and Customer Service.
In conclusion, this is a flexible way of presenting strategy and showing the conclusions of many data sets in a simple picture. I recommend Kim and Mauborgne’s paper: it’s a good read and presents additional simple tips on creating winning strategies. Next time you present a strategy, consider using a strategy canvas. I’d be interested to hear how you get on.
Kim, W. & Mauborgne, R. (2002) “Charting Your Company’s Future”, Harvard Business Review, June.
Kaplan, R. & Norton, D. (2000) “Having Trouble with your strategy? Then map it” Harvard Business Review, September.