Blue ocean strategy promises to change the destructive cycle of market crowding. 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. Pdf business competition among companies has led to major changes. Summary capter 1 4 of blue ocean strategy by lauri di. The authors allude to the fact that most companies borrow their strategic thinking from military models see paradox of strategy. Blue ocean strategy is a book published in 2005 and written by w.
Before we dive into blue ocean strategy examples, lets get clear on what a. Strategy in the age of digital disruption online insead blue ocean strategy. Chan kim and renee mauborgne focused on discovering the common factors that lead to the creation of blue oceans and the key differences that separate those winners from the mere survivors and those adrift in the red ocean. We believe that blue ocean strategy will send you on the right path towards creating your own uncontested space. Blue ocean strategy including examples and pdf download. How to create uncontested market space and make the competition irrelevant, is very informative. Blue ocean idea index the blue ocean idea index is a simple but robust test demonstrating how the sequence of utility, price, cost, and adoption form an integral whole to ensure commercial success through blue ocean strategy. But its not always clear how to create a blue ocean strategy for yourself. Value innovation strategy competes in an uncontested market space. But its much more common for a blue ocean to be created from within a red. Strategy canvas excel template blue ocean strategy.
How to create uncontested market space and make the competition irrelevant by w. Ive been quoted for saying that strategies are dead. 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. Chan kim and renee mauborgne, the writers of the 2005 book blue ocean strategy. Click the link above to read the key concepts and everything you want to know about the blue ocean strategy.
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. Blue ocean strategy has helped numerous companies and organisations across the globe to create new market space and achieve pro. Blue ocean is a slang term for the uncontested market space for an unknown industry or innovation. Blue ocean strategy implementation ikeas competitive strategy is blue ocean strategy, which led ikea create leading position in local furniture industry. Our team in the blue ocean strategy simulation was anuket. Blue ocean strategy and sustainability for strategic.
Apple observed the flood of illegal music file sharing that began in the late 1990s, enabled by file sharing programs such as napster, kazaa, and limewire. Set sail towards your blue ocean jk beteiligung gmbh. How to create uncontested market space and make the competition irrelevant, a book by professors w. Blue ocean strategy chapter 14 the four action framework chapter two. Red ocean in blue oceans, demand is created rather than fought over. Part b of the dvd movie then documents how one firm, casella wines. The objective of blue ocean strategy is to make competition irrelevant by creating a new value curve for both customers and the company itself. The risks of following a blue ocean strategy the adaptive. The report focuses on three relevant issues regarding. The blue ocean strategy is a business book that has become mandatory for modern managers by proposing an organized structure to identify and implement differentiation in any industry and help you grow your business faster. A business strategy, in simple terms, is a documented plan on how an organization is setting out to achieve their goals. The insead blue ocean strategy institute is dedicated to extending the research on blue ocean shift, blue ocean strategy, and blue ocean leadership by chan kim and renee mauborgne and disseminating it to professors, researchers and practitioners around the globe. Tools and frameworks for creating and capturing blue oceans it is constructed to create a new value curve and when you apply the four actions framework to the strategy canvas of your industry, you get a. Download a pdf version of the formulation teaching module here.
Over the last several decades, product development efforts have seen unacceptably high new. One is to launch completely new industries, as ebay did with online auctions. The blue ocean strategy can be extremely rewarding, but can also be the most work intensive. Jofre foreword the present report is the result of an ongoing study on the patterns and trends on both the theory and practice in the field of strategic management. The blue ocean strategy explains how to guide your business across seas with less competition and greater profitability. Chan kim and renee mauborgne provide tools and frameworks for creating blue oceanstheir term. Compaq pc servers compag created a blue ocean in 1992 with its prosignia server, which gave buyers twice the file and print capability of the minicomputer at onethird the price. Strategy and thinking is not limited by preconceived barriers, and a shift happens from a focus on the supply side to a focus on the demand. A business strategy contains a number of key principles that outlines how a company will go about attaining these goals. Using blue ocean strategy to reduce new product failure. Blue ocean shift is packed with realworld examples of organizations facing the same constraints we all face be they politics, bureaucracy, or limited resources that applied the very tools and process outlined in the book to shift from competi. Cmo home opinion guest columnist blue ocean strategys fatal flaw by wayne e. 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. 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.
The strategy can transform a current product or idea or create something total new. Here are a few examples of blue ocean strategic moves from a variety of different industries and sectors. Their book teaches readers how to create uncontested markets for. The blue ocean strategy is a reconstructionist view of the market where no accepted boundaries or structure is present. This template includes most popular strategic models, matrixes and many more. Pdf blue ocean strategy as a tool for improving a companys. The theory and practice of strategy in business organizations s. The blue ocean strategy works to create an untapped marketplace outside of the traditional market boundaries. The strategy canvas is both a diagnostic and an action framework for building a compelling blue ocean strategy. Chan kim and renee mauborgne provide tools and frameworks for creating blue oceanstheir term for all the industries not in existence today. Most prominently, since 2009 the malaysian government has. By 2003 more than two billion illegal music files were being traded every month. Blue ocean strategy is a landmark idea founded by w. Pdf harvard business school press blue ocean strategy rajeh.
Explain these from the perspective of company, competition, costs, and markets. Blue ocean strategy is based on over decadelong study of more than 150 strategic moves spanning more than 30 industries over 100 years. Achieved via the delivery of features that have a highest marginal benefit to customer needs. The on the blue ocean strategy essay 1969 words 8 pages. Blue ocean strategy is a strategy that advice companies. An introduction to blue ocean strategy mba knowledge base.
In red oceans, there is a competitiveadvantage worldview, companies are often driven to outperform rivals and capture greater shares of existing or shrinking market space. Jun 08, 2007 profit model of blue ocean strategy 30. For example, apple observed the flood of illegal music file sharing that began in. There is ample opportunity for growth that is both profitable and rapid. Bos in order to optimize the implementation of blue ocean strategy, making the value of the company and the products to be. Chan kim and renee mauborgne in the indie business book club. It requires the right research, patience and focus. The only thing that i am not very fond of the book is that theres too much repetition in the book until i got bored going through the 230 or so pages. 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.
Ikea has been successful in nanjing by implementing a blue ocean strategy that is. By defining and seeing examples of the blue ocean strategy, your organization can learn how to execute on this strategic planning model and successfully reconstruct your market. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking. Pollard in their international bestseller, blue ocean strategy, w.
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. We owned a 14% market share with red box and 15% market share with blue box. Blue ocean strategy is a strategy that advice companies to go to. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute.
This is a key principle of blue ocean strategy which sees low cost and differentiation being pursued simultaneously. This blog article is a overview of some of the key points of the book by w. Blue ocean strategy is innovative, and it creates a new market instead of fitting into the current market. Pdf blue ocean strategy for project based organizations. The first example of blue ocean strategy comes from computer games giant, nintendo, in the form of the nintendo wii. Blue ocean strategies on february 12, 2020 blog, b2b strategy and messaging, virtual vp of marketing it can be difficult to succeed with the cutthroat competition in the business environment today. I believe it, of course, but thats no excuse for not knowing how your blog stands out from the competition. When we think of competition between companies like coke and pepsi or walmart and costco, we think of competitors fighting to. Blue ocean strategy and sustainability for strategic management. Blue ocean challenges companies to push the boundaries of their industries and offer consumers something unique of immense value.
It was built on the notion of creating new markets where competition is irrelevant and the opportunity to grow and be profitable is unlimited. The structure can be created or recreated by the steps taken by players in the market. Vol5, issue 4 international journal of management sciences and. Dell builttoorder computers in the mid1990s, deli created a blue ocean in a highly. Blue ocean strategy is a consistent pattern of strategic thinking behind the creation of new markets and. What are some successful examples of blue ocean strategy. Sep 24, 2017 blue ocean strategy requires a different mindset. Most prominently, since 2009 the malaysian government has implemented a national blue ocean strategy to lift the living standard of the country and to. Jul 16, 2015 the blue ocean strategy is a reconstructionist view of the market where no accepted boundaries or structure is present. With the launch of itunes, apple unlocked a blue ocean of new market space in digital music that it has now dominated for more than a decade. See examples of strategic moves that enabled organizations to successfully break out of red oceans and create blue oceans of uncontested market space. Chan kim and renee mauborgne, published by harvard business school press, boston, massachusetts, 2005, isbn 97815996192 blue ocean strategy is a business strategy book, first published on february 3, 2005. This blog article takes a look at what kind of roi some companies have achieved by implementing a blue ocean strategy by w. Strategy canvas excel template blue ocean strategy subject.
Blue ocean strategy paper adel erolsky university of phoenix mkt421 ron rosalik august 25, 2014 blue ocean strategy paper in todays business world, competition is a big concern for nearly every corporation. While the recording industry fought to stop the cannibalization of. Welcome to blue ocean strategy were thrilled to have you on board. Furthermore the blue ocean strategy was awarded with. The nintendo wii launched in 2006 and at its heart is the concept of value innovation. The real opportunity is to create blue oceans of uncontested market space.
For that there is nothing better than something called the blue ocean strategy. May 30, 2017 t his month, we read blue ocean strategy by w. Blue ocean strategy is a powerful framework for finding new business opportunities. Guest columnist blue ocean strategys fatal flaw by wayne e. Curves fitness industry case study blue ocean strategy. Companies have resorted to developing innovative strategies and subsequently suitable portfolios have been created for the implementation of. 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. At the end of all rounds of the simulation, our company health was as follows. Summary capter 1 4 of blue ocean strategy by lauri di vino. Blue ocean strategy blue ocean strategy is a strategic move that organizations or individuals use to create new product or ideas. Essay about blue ocean strategy 825 words bartleby. Chan kim and renee mauborgne in their book blue ocean. The competition on the market is getting stronger and more difficult to overcome.
Companies pursue blue ocean strategies to make competition irrelevant. Those who want to create a blue ocean strategy for their company must focus on value innovation that makes the competition irrelevant by the simultaneous pursuit of differentiation and low cost, thus creating a leap in value for the customers and an uncontested market space for the company. There are two types of oceans in this world, according to authors w. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. Competing in overcrowded industries is no way to sustain high performance.
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