blue ocean strategy
Blue Ocean Strategic Moves
The New York City Police Department (NYPD) executed a blue ocean strategy in the 1990s in the public sector. When Bill Bratton was appointed police commissioner of New York City in February 1994, the odds were stacked against him to an extent few executives ever face. In the early 1990s, New York City was veering toward anarchy. Murders were at an all-time high. Muggings, Mafia hits, vigilantes, and armed robberies filled the daily headlines. New Yorkers were under siege. But Bratton’s budget was frozen. Indeed, after three decades of mounting crime in New York City, many social scientists had concluded that it was impervious to police intervention. The citizens of New York City were crying out. A front-page headline in the New York Post had screamed: “Dave do something!”— a direct call to then mayor David Dinkins to get crime down fast. With miserable pay, dangerous working conditions, long hours, and little hope of advancement in a tenure promotion system, morale among the NYPD’s thirty-six thousand officers was at rock bottom—not to mention the debilitating effects of budget cuts, dilapidated equipment, and corruption. In business terms, the NYPD was a cash-strapped organization with thirty-six thousand employees wedded to the status quo, unmotivated, and underpaid; a disgruntled customer base—New York City’s citizens; and rapidly declining performance as measured by the increase in crime, fear, and disorder. Entrenched turf wars and politics topped off the cake. In short, leading the NYPD to execute a shift in strategy was a managerial challenge far beyond the imaginations of most executives. The competition — the criminals—was strong and rising. Yet in less than two years and without an increase in his budget, Bratton turned New York City into the safest large city in the United States. He broke out of the red ocean with a blue ocean policing strategy that revolutionized U.S. policing as it was then known. Between 1994 and 1996, the organization won as “profits” jumped: Felony crime fell 39 percent, murders 50 percent, and theft 35 percent. “Customers” won: Gallup polls reported that public confidence in the NYPD leaped from 37 percent to 73 percent. And employees won: Internal surveys showed job satisfaction in the NYPD reaching an all-time high. As one patrolman put it, “We would have marched to hell and back for that guy.” Perhaps most impressively, the changes have outlasted its leader, implying a fundamental shift in the organizational culture and strategy of the NYPD. Even after Bratton’s departure in 1996, crime rates have continued to fall. Few corporate leaders face organizational hurdles as steep as Bratton did in executing a break from the status quo. And still fewer are able to orchestrate the type of performance leap that Bratton achieved under any organizational conditions, let alone those as stringent as he encountered. Moreover, defying conventional wisdom, Bratton achieved these breakthrough results in record time with scarce resources while lifting employee morale, creating a win-win for all involved. Nor was this Bratton’s first strategic reversal. It was his fifth, with each of the others also achieved despite his facing all four hurdles that managers consistently claim limit their ability to execute blue ocean strategy: the cognitive hurdle that blinds employees from seeing that radical change is necessary; the resource hurdle that is endemic in firms; the motivational hurdle that discourages and demoralizes staff; and the political hurdle of internal and external resistance to change. Tipping point leadership reveals how a leader can knock down these hurdles fast and at a low cost by leveraging disproportionate influence factors.
News
2011
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