Recognized as one of the most iconic and impactful strategy books ever written, blue ocean strategy, now updated with fresh content from the authors, argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. Small and mediumsized enterprises smes around the world account for 95% of all businesses and 77% of employment on average, yet their contribution to gdp is a mere 54%. View the entire blue ocean leadership series here w.
Blue ocean strategy is a strategy that advice companies. Expanded editions of blue ocean strategy were published in 2015 and 2017, respectively. Red ocean strategy blue ocean strategy compete in existing market space. We need to rethink how we search for innovative business ideas. In the reconstructionist world, however, the strategic aim is to create new bestpractice rules by breaking the existing valuecost tradeoff and thereby creating blue ocean. Value innovation value innovation places equal emphasis on value and innovation. Journal of international accounting, auditing and taxation, 232, 7486. This strategy is the first comprehensive strategy that looks at the ocean industries in context. How to create uncontested market space and make the competition irrelevant, professors w.
Heres a look at the basic premise of blue ocean strategy, and how you can apply it to your small business strategy. Find your space in the blue oceanand build your blue ocean. Red ocean in blue oceans, demand is created rather than fought over. Based on a study of 150 strategic moves spanning more than 100 years. The idea in brief the best way to drive profitable growth. 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.
Today, we tell you something about an interesting chaper in osterwalders book about the blue ocean strategy. Explain these from the perspective of company, competition, costs, and markets. Blue ocean strategy chapter 14 the four action framework chapter two. Blue ocean strategy is a concept that has been pioneered by insead professors, w. The creation of blue oceans is about driving costs down while simultaneously driving value up for buyers. Most prominently, since 2009 the malaysian government has implemented a national blue ocean strategy to lift the living standard of the country and to. The blue ocean strategy is based on the concept that industry structure and market. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking. Blue ocean strategy for small businesses fundbox blog. Utilizing a blue ocean strategy to real business cases and in management as a part of lim. Blue ocean strategy, expanded edition harvard business publishing. Download a pdf of this article and check back next tuesday for how to see your leadership reality. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world.
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. Value innovation strategy competes in an uncontested market space. This strategy revolves around searching for a business in which very few firms operate and where there is no pricing pressure. 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. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was. There youll find all the resources you needfrom ideas in practice and cases from government and private industry, to teaching materials, mobile apps, realtime updates, and tips and tools to help you make your blue ocean journey a success. On blue ocean strategy by kim and mauborgne the business model canvas is a perfect extension of the analytical tools presented by kim and mauborgne. Chan kim, of blue ocean strategy, expanded edition 2015. Mar 16, 2015 today, we tell you something about an interesting chaper in osterwalders book about the blue ocean strategy. The blue ocean idea index provides a simple but robust test of this system view. Understanding this dynamic is what led target to revamp its product strategy and move into a less crowded market. Find your space in the blue oceanand build your blue ocean strategy.
Summary of the first four chapters of the international bestseller blue ocean strategy. Blue ocean strategy is a book published in 2005 and written by w. Blue ocean strategy page 1 main idea the best way to beat your competition is, in fact, to stop competing against them. Chan kim and renee mauborgne in their book blue ocean. Sep 24, 2017 blue ocean strategy requires a different mindset. Jul 16, 2015 the blue ocean strategy is a reconstructionist view of the market where no accepted boundaries or structure is present. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. How to create uncontested market space and make the competition irrelevant is the 2015 update to the classic business strategy text of the same name originally published in 2005. This strategy, which is based on extensive research of hundreds of companies spanning across decades and including several industries, proclaims that instead of battling competitors, companies can create new markets for themselves. How to create uncontested market space and make the competition irrelevant, 2. Traditional competitive strategy vs blue ocean strategy. Jun 22, 2016 however, the blue ocean strategy takes a different view. Theyve progressed every year since to 15th in 2005. There is ample opportunity for growth that is both profitable and rapid.
They are completely or relatively satisfied with provided service. Featured case series blue ocean strategy the case centre. In pursuit of public sector efficiency and value innovation. In a few cases, companies can give rise to completely new industries, as ebay did with the online auction industry. It became an international bestselling business book and was recently updated in. Making the internal process company ipf bos in order to optimize the implementation of blue ocean strategy, making the value of the company and the products to be better in the consumers.
Pdf on feb 21, 2017, boyong li and others published blue ocean strategy. Achieved via the delivery of features that have a highest marginal benefit to customer needs. Blue ocean strategy tools and frameworks provide a compelling path to achieve just that. May 30, 2017 t his month, we read blue ocean strategy by w. Value innovation is a new way of thinking about and executing strategy that results in the creation of a blue ocean. Pdf harvard business school press blue ocean strategy. The blue ocean strategy is a reconstructionist view of the market where no accepted boundaries or structure is present. Strategy maritime opportunities blue growth for a green future the governments maritime strategy. At the end of all rounds of the simulation, our company health was as follows. This international bestselling book sold more than a million copies in its first year of publication, and has. This framework addresses not only the analytic aspects behind the creation of blue ocean strategy but also the allimportant human aspects of how to bring an organization and its people on this journey with a willingness to execute these ideas in. May 26, 2015 summary of the first four chapters of the international bestseller blue ocean strategy. Blue ocean strategy is a business strategy book, first published on february 3, 2005 by the harvard business school press. We owned a 14% market share with red box and 15% market share with blue box.
How to create uncontested market space and make the. This article explains the blue ocean strategy, developed by w. Chan kim born 1952 is a koreanborn business theorist, professors of strategy and management at insead, and codirector of the insead blue ocean strategy institute in fontainebleau, france. Blue ocean in banking sector liberalization resulted in indias central bank reserve bank of india rbi, allowing private sector banks in the sector which saw opening of many more branches. This blog article is a overview of some of the key points of the book by w. They are the authors of blue ocean strategy, which has sold over 3. The blue ocean strategy seems to be a perfect solution for present companies to become sustainable successful. In this way, it swam into a blue ocean, offering a plastic watch at a price that allowed people to purchase two or three watches at one time. How to create uncontested market space and make the competition irrelevant, a book by professors w.
Chan kim is the codirector of the insead blue ocean strategy institute and a chair professor of strategy and international management at insead. The governments goal is for norway to become the worlds foremost ocean economy. 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. Blue ocean strategy is a strategy that advice companies to go to a new market, which interest customers and avoid competition from the existing market. Blue ocean strategy and its implications for businesses.
Jun 21, 2007 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 group includes those who are consistently using the existing products and services. We will achieve this by facilitating blue growth through green restructuring. The structure can be created or recreated by the steps taken by players in the market. The blue ocean strategy as a method for developing sustainable profitable frameworks implies the fundamental idea of developing new innovational markets with a majority of new customers. How to create uncontested market space and make the competition irrelevant by w. They provided a powerful framework for questioning incumbent. Social sector application and research, including such topics as how blue ocean strategy can be applied in the developing world to mitigate poverty and improve education and health. Blue ocean is a slang term for the uncontested market space for an unknown industry or innovation. Now updated with fresh content from the authors, blue ocean strategy argues. This study is aimed at analyzing the condition of a company implementing the blue ocean strategy represented by pt kintetsu world express in the period of 201220. Blue ocean strategy is a growth strategy framework focused on the idea of creating an uncontested market spacei. November 2015 andreas karaoulanis this paper aims to give the main guidelines for strategic implementation of blue oceans strategy and how this kind of strategy is a part of turnaround management. The maritime strategy presents the governensure sustainable maritime value creation in of the ocean industries.
Its authors, insead professors w chan kim and renee mauborgne, continued their steady progress up the thinkers50 list, finishing second to christensen this year. 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. In the international bestseller blue ocean strategy, w. It is being published in a recordbreaking 44 languages and is a w. Chan kim and renee mauborgne, professors at insead. 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. 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. Blue ocean strategy has its roots in the emerging school of economics called.
After reading you will understand the basics of this powerful strategy tool what is the blue ocean strategy. Blue ocean strategy can be applied across sectors or businesses. So powerful is blue ocean strategy, in fact, that a blue ocean strategic move can create brand equity that lasts for decades. Red ocean strategy blue ocean strategy the statistical population and community of customers in the blue ocean strategy include kim and mauborgne, 2005. Sep 23, 2014 download a pdf of this article and check back next tuesday for how to see your leadership reality. The premise of the book is that companies can succeed by creating. To learn more about the power of blue ocean strategy, visit. His book blue ocean strategy, coauthored with renee mauborgne, has sold 3. How to create uncontested market space and make the competition irrelevant hardcover january 20, 2015. Blue ocean strategy provides a theoretical framework and a practical roadmap for companies to break away from the cutthroat competition in existing industries and create new market space of profitable growth. 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. Chan kim and renee mauborgne in the indie business book club.
The blue ocean strategy bos is the strategic organizational approach that is based on the principle that companies should not engage in a. Here we explore how entrepreneurs around the globe are using blue ocean strategy to break out of the red ocean and achieve strong results. Summary capter 1 4 of blue ocean strategy by lauri di. Pdf for creating new demands and open up a new market space the pursuit of differentiation. The authors allude to the fact that most companies borrow their strategic thinking from military models see paradox of strategy. The four pillars of blue ocean leadership insead knowledge. In other words, when you go headtohead against rivals for a share of the existing market, this is like competing in a red ocean. But, lets first understand what is blue ocean and how it is different from red ocean strategy. It reduced costs by using plastic instead of metal, for example, and reducing the parts in each watch from 150 to 50. 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. Our team in the blue ocean strategy simulation was anuket. Pricing innovation profit model of blue ocean strategy 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. This blog article takes a look at what kind of roi some companies have achieved by implementing a blue ocean strategy by w.
Blue ocean strategy is referred to a market for a product where there is no competition or very less competition. Individual chapters from the best selling blue ocean strategy book are also available from the case centre. Pdf blue ocean strategy download full pdf book download. Based on a study of 150 strategic moves spanning more than 100 years and 30. Pdf blue ocean strategy for creating value of the organization. In this article, we take a closer look at the factors that are responsible for jetblues success so far, and its strategy going forward. The linchpin of any blue ocean strategy is strong product differentiation. One is to launch completely new industries, as ebay did with online auctions. This includes building support centers to promote rural industry, enhancing tax incentives, and encouraging retired and middleaged individuals to return to the. Chan kim and renee maugborgne, was published in 2005 based on studies of 150 strategic business moves that took place over the course of a century. The insead blue ocean strategy institute is dedicated to extending the research on blue ocean shift, blue ocean strategy, and blue ocean leadership by. The corporate tax rate for the first 15 to 50 years of operations is zero and can be extended. It is the idea of trying to find market spaces that are free of competitors by creating and caputuring new demand. Instead, create a new marketplace for your business that allows you to write the rules.
A blue ocean strategy leading to business model generation when creating a value for the mature consumer, we need a strategy. He is known as coauthor of the 2005 book blue ocean strategy. Chan kim and renee mauborgne are professors of strategy at insead and codirectors of the insead blue ocean strategy institute. It is being published in a recordbreaking 44 languages and is a bestseller across five continents. This led to increased competition, with private sector banks vying for higher growth. Chan kim is the codirector of the insead blue ocean strategy institute and a chair professor of. Made by group d of the minor global trendwatching 2015.
This framework is very innovative, as its principles challenge the conventional business. But its much more common for a blue ocean to be created from within a red. Blue ocean strategy including examples and pdf download. Blue ocean strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. There is ample opportunity for growth tbat is both profitable and rapid. Public sector application and research, including the application of blue ocean shift, blue ocean strategy, and blue ocean leadership to governments and nonprofits. 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 and deutsche bank fintech development. Blue oceans strategy is the approach that suggests a company is better off searching for ways to play in uncontested market places instead of engaging with competition in existing marketing spaces.
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