a blue ocean strategy idea threatens the

Blue Ocean Strategy was first published in 2005. “The key goals of the blue ocean strategy are finding the right marketing opportunity and making the competition irrelevant.” Yet, the blue ocean metaphor is also misleading, for it suggests that the red versus blue distinction is the main distinct and new contribution of the book. With over 4 million copies sold, it is one of the most popular strategy texts today. Blue Ocean ideas are all over the place just waiting to be discovered. The goal of a Blue Ocean Strategy is for organizations to find and develop “blue oceans” (uncontested, growing markets) and avoid “red oceans” (overdeveloped, saturated markets). But is it also a good idea? My drive is to bring you and your organization to the next level with new and effective strategy approaches and tools. 6. Blue ocean strategy comes with a complete set of analytical tools and frameworks for formulating and executing a blue ocean strategic move. Companies need to build their blue ocean strategy in the sequence of buyer utility, price, cost, and adoption. Blue Ocean Ideas is a brand management agency. The approach of blue ocean strategy is as follows: i. Blue ocean strategy makes competition irrelevant but tries to create and capture a new market. Using the framework for building a compelling blue ocean strategy, we will apply the Blue Ocean Strategy Canvas to healthcare across three areas: Where the competition is investing. The basic message of Blue Ocean Strategy is that organizations should not try to compete in existing markets (red oceans) but rather create or find new markets where competition does not yet exist (blue oceans). Four key factors to become a leader in Content and Social Media Hospit… This is the concluding presentation of a two part webinar for Blue ocean strategy. With the Jaws movies series in mind, we can easily visualize a bloody red ocean with aggressive sharks eating you alive. Since the industries are in a state of non-existence, there is absolutely no relevance of peer comparison. A blue ocean exists when there is potential for higher profits, as there is now competition or irrelevant competition. The frameworks offered in Blue Ocean Strategy, on the other hand (such as the "strategy canvas" and the "four actions framework") are specifically aimed at helping companies to come up with new strategies. If the basic message of Blue Ocean Strategy is not that new, does this mean we should discard it as just another management fad? A blue ocean is vast, deep, and powerful in terms of profitable growth. Unless the Blue Ocean initiative is conducted by people with the distinctive opportunity-based thinking that is at the foundation … This blog article is a overview of some of the key points of the book by W. Chan Kim and Renée Mauborgne.In this article you will learn how to make your competition irrelevant and have sales and profit … It means deliberately choosing a different set of activities to deliver a unique mix of value." 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. WHAT IS THE BLUE OCEAN STRATEGY The term blue ocean was coined by two professors W.Chan Kim and Renee Mauborgne in their book titled 'Blue Ocean Strategy: How to Create Uncontested Market … Most blue oceans are created from within red oceans by expanding existing industry boundaries. a. blue ocean 41. eBay's invention of online auctions is an example of the _____ strategy. Blue Ocean Strategy is all about devising and acquiring the uncontested market forum by spawning a new demand. Adoption. A so large change threatens the status quo, and for that reason it may provoke insecurity and resistance among company’s stakeholders. The misconception that blue ocean strategy is a low-cost strategy that focuses on low pricing. Thinking you need to be first to market to unlock a blue ocean. A blue ocean exists when there is potential for higher profits, as there is now competition or irrelevant competition. Porter’s five forces framework is helpful for understanding the structure of an industry and the competitive dynamics within it. With over 4 million copies sold, it is one of the most popular strategy texts today. Products become commodities, leading to cutthroat or ‘bloody’ competition. Here, companies try to outperform their rivals to grab a greater share of existing demand. 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. I am a strategy consultant, professor, writer and speaker and founder of Better as Strategy—an online strategy learning platform and community. Parts one and two can be found below: Part 1: Blue Ocean Strategy -- Finding and Exploiting Uncontested Markets. The presentation introduces the audience to the core principles of Blue Ocean Strategy - which comprise of the six steps viz 1) Reconstructing Market Boundaries 2) Focusing on the Big Picture 3) Reaching Beyond Existing Demand 4) Getting the strategic sequence right 5) Overcoming organizational … The blue ocean idea index helps to keep that systemic vision. The strategy aims to capture new demand, and to make competition irrelevant by introducing a product with superior features. For many companies—both startups and incumbents—the panacea of strategy is to create an entirely new market without competition. Of course, great ideas … It is based on the view that market boundaries and industry structure are not a given and can be reconstructed by the actions and beliefs of industry players. A so large change threatens the status quo, and for that reason it may provoke insecurity and resistance among company’s stakeholders. The belief that blue ocean strategy is a theory of marketing and a niche strategy. In doing so, they suggest that Porter’s approach is aimed at competing in existing markets whilst their own approach at the creation of new markets. You can reach out to me via jeroenkraaijenbrink.com,  LinkedIn or jk@kraaijenbrink.com or join my online strategy learning platform at betterasstrategy.com, © 2020 Forbes Media LLC. The strategy can transform a current product or idea or create something total new. Can it be more Blue Ocean? Opinions expressed by Forbes Contributors are their own. For anyone tired of competing head-to-head and not getting far. And, the tranquil silence of the sunset over a blue ocean is readily depicted in our mind as well. Make the competition irrelevant. Creating blue oceans. GE1715 Blue Ocean Strategy IDEA BUILDER Key idea In Blue Oceans, demand is created rather than fought over. Secret of success. Blue Ocean Strategy Blue ocean strategy is a strategic move that organizations or individuals use to create new product or ideas. Often, companies believe that a great idea is enough to generate a commercial success. The strategy bags the new demand by familiarizing unique products with advanced features that stand apart from the crowd. A blue ocean is an analogy to describe the wider, deeper potential to be found in unexplored market space. Porter’s five forces framework, for example, doesn’t tell companies to go where the competition is—the red ocean. Blue Ocean Strategy Summary Chapter 11: Red Ocean Mistakes . Blue oceans, where a market space is new and uncontested, and strategy centers around value innovation. In their classic book, Blue Ocean Strategy, Chan Kim & Renée Mauborgne coined the terms ’red ocean’ and ‘blue ocean’ to describe the market universe. This idea of strategy is the core of Chan Kim & Renée Mauborgne’s Blue Ocean Strategy (2005). There is ample opportunity for growth that is both profitable and rapid. As the market space gets crowded, profits and growth are reduced. The belief that blue ocean strategy is the same as innovation. The crux of the strategy is a value-cost trade off. Blue Ocean Idea (BOI) Index is a simple yet robust tool to verify if a new business idea meets the criteria of a Blue Ocean Strategy. The Profit Model of Blue Ocean Strategy. This is the third and final part of the Blue Ocean Strategy series. Hence the term red oceans. Along those same lines, Porter’s generic strategies framework (cost leadership, differentiation, and focus) does not tell companies to develop strategies equal to their competitors. Blue ocean strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. But, as Kim & Mauborgne remark, these existing frameworks are not very well-suited to foster the kind of creativity needed for actually developing unique strategies. Along these, I wrote "Strategy Consulting," "No More Bananas" and the two-volume "The Strategy Handbook." It is about creating and capturing uncontested market space, thereby making the competition irrelevant. In short, you create a blue ocean by focusing on the factors that customers really care about, while discarding factors they don’t. Learn the basics of blue ocean strategy and shift created but the #1 Management Thinkers in the World. My drive is to bring you, I am a strategy consultant, professor, writer and speaker and founder of Better as Strategy—an online strategy learning platform and community. 7. This is most evident when we compare Blue Ocean Strategy to Michael Porter’s work. Blue Ocean Strategy – Approaches of Blue Ocean Strategy . Yet, Blue Ocean Strategy resembles Porter’s approach quite strikingly, and at their hart the message of both approaches is the same: if you can do it, go for uncontested market spaces. Blue Ocean Strategy - Including Examples And PDF Download. Not entirely. Ultimately Blue Ocean strategy is about a different mindset. There is ample opportunity for growth that is both profitable and rapid. In this article, we will look at 1) what is a blue ocean strategy? 9. Sequence of Blue Ocean Strategy. Definition Blue Ocean Strategy is referred to a market for a product where there is no competition or very less competition. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. You don’t. 8. Porter’s model looks at specific factors that help determine whether a business can be profitable based on other businesses in the industry.Advocates of Kim and Mauborgne’s strategy would say this is a tactic that promotes merciless competition, remaining in the red waters.Th… While avoiding the use of Harvard Business School’s Michael E. Porter's name, Kim and Mauborgne attack the famous \"five forces\" market analysis head on. The focus on uniqueness and differentiation is so important to Porter, that he even defines strategy as “being different. This, though, is not an accurate depiction of the older strategy literature and doesn’t give it sufficient credit. Now is the time for Hotels to be proactive and not think tomorrow will look like today, but anticipate change and implement new innovative Content and Social Media Strategies. We exist to help organizations tell the truth about who they are, faster. W. Chan Kim and Rene Mauborgne (2005) presented a new strategy named blue ocean strategy. Worse still, it lost nearly 50% of its value between its 2007 heyday and January 2015 (MarketWatch, 2019). Furthermore, Kim & Mauborgne’s book contains a host of examples and some handy tools helping managers facing the challenge of developing new strategy. 2) understanding the blue ocean strategy, 3) how to apply the blue ocean strategy to your business, and 4) examples. However, this discussion will also include the more recently expanded 2015 edition. Content and Social Media Value Innovationis the key components for the future. The blue and red ocean metaphor is a powerful one. In blue oceans, competition is irrelevant because the rules of the game are waiting to be set. Blue Ocean is based on more than a decade-long study including 150 strategic moves spanning more than 30 industries over 100 years. Blue ocean strategy pushes companies to create new industries and break away from the competition. Summary Of The Blue Ocean Strategy Red oceans are all the industries in existence today – the known market space. Break the value/cost trade-off. The belief that blue ocean strategy is the same as innovation. And given that their recent follow-up book Blue Ocean Shift (2017) was an instant bestseller too, I assume the idea of a blue ocean is still as attractive as it was a decade ago. The power of Blue Ocean Strategy lies in the tools it provides for facilitating companies actually delivering a unique mix of value. The misconception that blue ocean strategy is a low-cost strategy that focuses on low pricing. Pitney Bowes began its spectacular decline in value almost nearly 2 years after creating its so-called uncontested market through a blue ocean strategy, which was trumpeted by its former CEO, Michael Critelli (Knowledge@Wharton, 2006). Blue Ocean Strategiespresents a systematic approach to making the competition irrelevant and outlines principles and tools any Hotels can use to create and capture their own blue oceans. That means 61% of the profits were generated by 16 blue ocean businesses. Such a strategy conflicts with, and threatens to replace, traditional approaches to competing within an industry. The first highlighted case from the Blue Ocean Strategy book is the Cirque du Soleil. Adoption. All Rights Reserved. These will be phrased as myths that are then debunked: Myth: Blue ocean strategy is a customer-led strategy focusing on existing customers. The Blue Ocean Strategy is a framework first introduced by W. Chan Kim and Renee Mauborgne in a book bearing the same name. To be successful with target costing, the strategy profile must be divergent but with focus. The Profit Model of Blue Ocean Strategy. In their book, Kim & Mauborgne position their approach directly against Porter’s strategy approach: his five forces framework, his three generic strategies and the like. In other words: it tells companies to be entrepreneurial, to find and create their own opportunities and differentiate themselves from others, rather than to take opportunities already taken by others. Let’s look at how company used the blue ocean in the book authored by Kim and Renee. The belief that blue ocean strategy sees competition as bad when in fact it can be good for companies. In red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. #BlueOceanShift and #BlueOceanStrategy are worldwide business strategy bestsellers, helping you to move beyond competing and start creating your #blueocean. A mistake that blue ocean strategy identifies is that companies confuse niches with new markets. 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