Stakeholders Last?!? After reading another three chapters of Blue Ocean Strategy, I’m caught in a bit of a values quandary. Towards the end of chapter 6, Kim and Mauborgne argue that Stakeholder engagement should come at the end of the Blue Ocean innovation process, after the molds of value differentiation, price, and (most importantly) low-cost operating procedure have been set. The assumption seems to be that Blue Ocean innovators need as much flexibility as possible to implement their breakthrough ideas: even if that flexibility involves outsourced jobs, bad working conditions, or heavy externalized environmental costs. By placing stakeholders last in the pecking order, Kim and Mauborgne make engagement a sort of cleanup process. Stakeholders must be coerced to get on board with the new strategic direction or steamrolled over, with minimal room to maneuver around their complaints.
It seems like there are several ways around this dilemma. The first is to enter the process with a strong sense of shared values. If customers, employees, and other key stakeholder groups are all committed to a set of shared values, then those values can be a key input to the innovation process which will ensure that the end result is accepted. When such an array of shared values does not exist, a goal of the Blue Ocean strategy should be to create one. Once a unique value curve has been produced, and BEFORE proceeding with the rest of the process, the strategic team should challenge itself to restate the product’s value key value proposition to stakeholder groups other than customers. (ie, employees can feel pride at revolutionizing an industry and look forward to growth in their careers, society at large may indirectly benefit from your products use.)These value propositions should be integrated to find a shared value, one that can be the central framing of an immediate, comprehensive stakeholder communications strategy around the strategic move. By the time that cost is being determines (and most stakeholder concerns are being brought to the fore) stakeholders should be ready to engage in a discussion focused on innovating around shared values rather than on protecting entrenched interests. This discussion can in turn reveal key cost-cutting partnership opportunities and ensure that the product goes to market with comprehensive stakeholder support.