The book can be nicely summarized by the following interesting quotes from the book: In blue oceans, competition is irrelevant because the rules of the game are awaiting to be set. He actually urged the line managers to read the Blue Ocean Strategy book before we do our usual planning sessions. As it happens though I really trust Mr.
The first part presents key concepts of blue ocean strategy, including Value Innovation — the simultaneous pursuit of differentiation and low cost — and key analytical tools and frameworks such as the strategy canvas and the four actions framework.
The four actions framework aids in eliminating the trade-off between differentiation and low cost within a company. The four actions framework consists of the following: This questions which factors must be raised within an industry in terms of product, pricing or service standards.
This questions which areas of a company or industry could be completely eliminated to reduce costs and to create an entirely new market.
Therefore, it can be reduced without completely eliminating it. This prompts companies to be innovative with their products. By creating an entirely new product or service, a company can create their own market through differentiation from the competition.
The second part describes the four principles of blue ocean strategy formulation.
These four formulation principles address how an organization can create blue oceans by looking across the six conventional boundaries of competition Six Paths Frameworkreduce their planning risk by following the four steps of visualizing strategy, create new demand by unlocking the three tiers of noncustomers and launch a commercially viable blue ocean idea by aligning unprecedented utility of an offering with strategic pricing and target costing and by overcoming adoption hurdles.
The book uses many examples across industries to demonstrate how to break out of traditional competitive structuralist strategic thinking and to grow demand and profits for the company and the industry by using blue ocean reconstructionist strategic thinking.
The four principles are: The third and final part describes the two key implementation principles of blue ocean strategy including tipping point leadership and fair process. These implementation principles are essential for leaders to overcome the four key organizational hurdles that can prevent even the best strategies from being executed.
The four key hurdles comprise the cognitive, resource, motivational and political hurdles that prevent people involved in strategy execution from understanding the need to break from status quo, finding the resources to implement the new strategic shift, keeping your people committed to implementing the new strategy, and from overcoming the powerful vested interests that may block the change.
Unlike the "red ocean strategy", the conventional approach to business of beating competition derived from the military organization, the "blue ocean strategy" tries to align innovation with utility, price and cost positions.
The authors justify with original and practical ideas that neither the company nor the industry is the best unit of analysis of profitable growth; rather it is the strategic move that creates "blue ocean" and sustained high performance. The book examines the experience of companies in areas as diverse as watches, wine, cement, computers, automobiles, textiles, coffee makers, airlines, retailers, and even the circus, to answer this fundamental question and builds upon the argument about "value innovation" being the cornerstone of a blue ocean strategy.
Value innovation is necessarily the alignment of innovation with utility, price and cost positions. This creates uncontested market space and makes competition irrelevant. The new chapters in the expanded edition of the book deal with the issues of how to develop and align the three strategy propositions of value, profit and people, how to sustain and renew blue ocean strategy at both the business level and the corporate level, and how to avoid red ocean traps that keep organizations anchored in existing market space even as they attempt to create new market space.
Please improve it by verifying the claims made and adding inline citations.
Statements consisting only of original research should be removed. December Cirque du Soleil — an example of creating a new market space, by blending opera and ballet with the circus format while eliminating star performers and animals.
The metaphor of red and blue oceans describes the market universe. In the red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. Here companies try to outperform their rivals to grab a greater share of product or service demand.
As the market space gets crowded, prospects for profits and growth are reduced. Products become commodities or nicheand cutthroat competition turns the ocean bloody; hence, the term "red oceans". In blue oceans, demand is created rather than fought over. There is ample opportunity for growth that is both profitable and rapid.
In blue oceans, competition is irrelevant because the rules of the game are waiting to be set.Reviewing the Blue Ocean Strategy Is the Blue Ocean Strategy valid and reliable? Dmitrij Kabukin Master thesis Business Administration Innovation & Entrepreneurship.
Blue Ocean Strategy is a bad book, but it is not your usual bad book.
It is a dangerous bad book because it takes some thinking to figure out why it is bad, despite its success, and despite the fact that its key metaphor of blue ocean vs. red ocean has made it . The book titled "Blue Ocean Strategy" is not helpful to management – don't buy it and if you already have it dump it.
TRU Group Inc - Strategic Planning Consultants White Paper - Download. Free Essay: Outline the main components of Kim and Mauborgne’s () concept of ‘Blue Ocean Strategy’. Critically assess the strengths and limitations of.
Blue Ocean Strategy Paper MKT/ July 21, Anatomy of Blue Ocean Strategy In order to process the nature of a blue ocean entity, it is imperative to grasp the point of derivation, which is otherwise known as a red ocean. The Blue Ocean Strategy was published in and authored by W.
Chan Kim and Renée Mauborgne – Professors at INSEAD and co-directors of the INSEAD Blue Ocean Strategy Institute.