This 2005 book is aimed at anyone interested in pursuing the authors blue ocean. How to create uncontested market space and make the competition irrelevant, a. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. Chan kim and renee mauborgne is an outofbox kind of breakthrough book, that gets the best out of you. Find out today what blue ocean strategy can do for you. An introduction to blue ocean strategy mba knowledge base. Blue ocean strategy, the global phenomenon that has sold over 4 million copies and is recognized as one of the most iconic and impactful strategy books ever written, argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. In the past twenty five years, the main focus of strategic thinkings had. How to create uncontested market space and make the. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking. Netflix created uncontested marketing space by selling tv shows over the internet which no one else was currently doing. In order to unlock a blue ocean, a companys strategic profile should clearly show a strong focus, stand apart from competition, and have a clearly.
Now, to bring it to life, were looking at 3 examples of companies that have used the blue ocean strategy framework to. The distinctive characteristics of a red ocean are as follows. After reading you will understand the basics of this powerful strategy tool. Based on a study of 150 strategic moves spanning more than 100 years and 30 industries, blue ocean strategy addresses this question and provides a systematic approach to drafting and implementing your own blue ocean strategy. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. Pdf blue ocean strategy as a tool for improving a companys. It helps the company in make huge profits as the product can be priced a little steep because of its. This analysis is based on the drivers of corporate strategy including the need to grow quickly and more importantly sustain such growth, the need to not lose sight of either longer term profitability and the shorter term results and the balancing of both, and its focus on cost leadership. The characteristics of a welldefined research question should imply the possibility.
New demand in an uncontested market space, or a blue ocean, rather than by competing headtohead with other suppliers for known customers in an existing industry. What is blue ocean strategy about blue ocean strategy. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Blue ocean strategy case study service nsw 3 1 introduction blue ocean strategy1 has been used extensively to transform the public sector around the world at a local, state and national level. The concept of blue ocean is based on the idea that the business universe is made up.
This post defines blue ocean strategy and explores a few examples while pointing out the five main risks of pivoting in the search for a. Blue ocean strategy proposes that businesses can have more success by creating a blue ocean, rather than trying to compete in the red ocean the traditional. Before we dive into blue ocean strategy examples, lets get clear on what a blue ocean is. In order to unlock a blue ocean, a companys strategic profile should clearly show a strong focus, stand apart from competition, and have a clearly understood tagline that communicates the strategy. Blue ocean strategy including examples and pdf download. It requires the right research, patience and focus. Characteristics of a good blue ocean strategy canopus. Who does not want to make competitors irrelevant and to in. The risks of following a blue ocean strategy the adaptive. In this article you will learn how to make your competition irrelevant and have sales and profit. Red oceans, where competition is fierce in bloody waters, strategy centers around beating rivals, and wins are often zerosum. Most prominently, since 2009 the malaysian government has implemented a national blue ocean strategy to lift the living standard of the country and to. List the factors the customer cares about, and current dimensions of competition. The strategy canvas of blue ocean strategy covers four features which were stated by the authors as the example of cirque du soleil which innovated in a formula so apparently burned as circuses and created a new kind of request which made competitors were.
The blue ocean entrepreneurship competition blue ocean strategy. Blue ocean is a slang term for the uncontested market space for an unknown industry or innovation. Testing the validity of blue ocean strategy versus competitive. Chan kim and renee mauborgne in their book titled blue ocean strategy. This blue ocean entrepreneurship competition was founded in maryland in 2014 by a young budding high school entrepreneur directly inspired by chan kim and renee mauborgnes blue ocean strategy and the blue ocean way of thinking. Blue ocean strategy although economic conditions indicate the rising imperative of blue oceans, there is a general belief that the odds of success are lower when companies venture beyond existing industry space.
In this article, we will look at 1 what is a blue ocean strategy. The main result shows that the company managed to identify a number of new. Blue ocean strategy is a strategy that advice companies. Blue ocean strategy what does it say name of institution. This article explains the blue ocean strategy, developed by w. Value innovation strategy competes in an uncontested market space. How to create uncontested market space and make the competition irrelevant, w. Therefore, the only feature which differentiates firms from a beach.
Jul 16, 2015 in this article, we will look at 1 what is a blue ocean strategy. Over the last several decades, product development efforts have seen unacceptably high new. While the book is aimed primarily at large, traditional businesses, our book club members managed to scale some of the advice to fit our needs. Tru group inc blue ocean strategy belongs in the dead sea. Blue ocean strategy makes companies to come out of ocean of bloody competition by creating market space which is uncontested and that makes the completion irrelevant. In ancient greece the word strategos was referred to as the role of an individual a general in command of an army. Since, dividing up existing demand and benchmarking the competitors, blue ocean strategy is regarding grow demand and break away from the competition. Summary of the first four chapters of the international bestseller blue ocean strategy. They assert that these strategic moves create a leap in value for the company, its buyers, and its employees while unlocking new demand and making the competition irrelevant. Analysis of amazons corporate strategy management study guide. Made by group d of the minor global trendwatching 2015. Sep 24, 2017 blue ocean strategy requires a different mindset. Jul, 2018 our study shows that blue ocean strategy is particularly needed when supply exceeds demand in a market, kim explained in an article on forbes. Mauborgne the seminal book blue ocean strategy has sold over 3.
High growth and profits an organization can generate by creating. Adopting a blue ocean strategy, pivoting to a brandnew markets without competitors, is, for many, the holy grail of corporate strategy. Blue ocean strategy introduces analytical tools to minimize risk. Blue ocean strategy is a landmark idea founded by w. Pdf on nov 5, 2015, ozgur onday and others published blue ocean strategy find, read and cite all the research you need on researchgate. Blue ocean idea index boi other companies companies should build their blue ocean strategy in the sequence of utility, price, cost, and adoption, these criteria form an integral whole to ensure commercial success. This post defines blue ocean strategy and explores a few examples while pointing out the five main risks of pivoting in the search for a rich blue sea without competitors. A blue ocean exists when there is potential for higher profits, as there is now competition or irrelevant competition. So powerful is blue ocean strategy, in fact, that a blue ocean strategic move can create brand equity that lasts for decades. The most important characteristic of blue ocean strategy bos is that.
The blue ocean idea index provides a simple but robust test of this system view. This blog article takes a look at what kind of roi some companies have achieved by implementing a blue. Blue ocean strategy is a book published in 2005 and written by w. Aug 20, 2017 adopting a blue ocean strategy, pivoting to a brandnew markets without competitors, is, for many, the holy grail of corporate strategy. Chan kim and renee mauborgne, professors at insead. Tru group inc strategic planning consultants white paper download. It states stop trying to beat the completion, to beat the completion. The book titled blue ocean strategy is not helpful to management dont buy it and if you already have it dump it. Pdf harvard business school press blue ocean strategy rajeh.
Blue ocean strategy provides a systematic approach to break out of the red ocean of severe competition and make the competition irrelevant by reconstructing market boundaries to create a leap in value for both the company and its buyers. In simple terms, strategy is the how part of achieving goals under certain conditions, constraints, restrictions and assumptions. In blue ocean strategy, there are three simple characteristics or yard stick used to evaluate strategies focus, divergence and compelling tagline. Blue ocean strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. Achieved via the delivery of features that have a highest marginal benefit to customer needs. In this article you will learn how to make your competition irrelevant and have sales and profit growth in excess of anything you thought was even possible. Hence, researchers of blue ocean strategy convinced that the only way to. A summary in slides pdf of blue ocean strategy, how to create. Blue ocean strategy challenges companies to break out of the red ocean of bloody competition by creating uncontested market space that makes the competition irrelevant. How to create uncontested market space and the make. Characteristics of a good blue ocean strategy canopus business. This blog article is a overview of some of the key points of the book by w. Furthermore the blue ocean strategy was awarded with.
This article examines amazons current corporate strategy and evaluates its suitability going forward. Pdf thinking of the blue ocean strategy beyond the competition. Blue ocean strategy promises to change the destructive cycle of market crowding. Chan kim and renee mauborgne in the indie business book club. Characteristics of a good blue ocean strategy collaborat, india blue ocean strategy uses three characteristics to determine a viable strategy. It was built on the notion of creating new markets where competition is irrelevant and the opportunity to grow and be profitable is unlimited. Instead of fighting headon with your competitors, how do you create uncontested market space and make the competition totally irrelevant. Blue ocean strategy is based on the idea that every enterprise can achieve higher profit by creating new demand in noncompetitive market so called blue ocean. Salient features of blue ocean are that it is a non competitive strategy, in a sense that it refuses to compete in traditional sense. The authors of the bestselling blue ocean strategy. Reviewing the blue ocean strategy university of twente student. The strategy canvas of blue ocean strategy covers four features which were stated by the authors as the example of cirque du soleil which innovated in a formula so apparently burned as circuses and created a new kind of request which made competitors were irrelevant.
Companies pursue blue ocean strategies to make competition irrelevant. Study 31 terms blue ocean strategy flashcards quizlet. Blue ocean strategy generally refers to the creation by a company of a new, uncontested market space that makes competitors irrelevant and that creates new consumer value often while decreasing costs. The main goal of a company in this market is to beat competitors. The strategy canvas visualizes the current state of the industry and shows how a blue ocean strategy differs from incumbents. The blue ocean strategy book has been sold over 3,5 million times, was published in 43 languages and is a bestseller across five continents. Pdf blue ocean strategy download full pdf book download. The most appropriate unit of analysis is the strategic move, the set of managerial actions and decisions involved in making a major marketcreating business offering. The blue ocean strategy offers users a framework for creating. May 31, 2016 instead of fighting headon with your competitors, how do you create uncontested market space and make the competition totally irrelevant. Since, dividing up existing demand and benchmarking the competitors, blue ocean strategy is. They represent businesses that may not be around today, or werent around until they came on to the scene.
Using blue ocean strategy to reduce new product failure. The strategy aims to capture new demand, and to make competition irrelevant by introducing a product with superior features. By doing this they made the competition irrelevant, creating and capture new demand for a service not currently available on the market. Blue oceans, both past and present, always is a prominent feature in most. When we think of competition between companies like coke and pepsi or walmart and costco, we think of competitors fighting to get the biggest share of. May 26, 2015 summary of the first four chapters of the international bestseller blue ocean strategy. This blog article takes a look at what kind of roi some companies have achieved by implementing a blue ocean strategy by w. In our last blog post, we explored the fundamentals of blue ocean strategy.