This can be done by creating more value for buyers enabling the company to open up a whole new uncontested market space, the blue ocean. 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. In this 5 minute blog, ill tell you what the difference is between a red ocean vs blue ocean and how you can survive a red ocean and swim into a more profitable and audible blue one. In order to create this shift in attention from red oceans to blue oceans the authors came up with a concept called value innovation that allows for a simultaneous pursuit. Blue ocean strategy the maturity of an industry has brought a company swimming in a red ocean, which means price war strategy, according to a bestseller book titled blue ocean strategy that is written by w. Blue oceans, in contrast, denote all the industries not in existence today. The following table is useful in highlighting the different focus areas between a red ocean and blue ocean strategy. In a blue ocean because of the uniqueness of your offering you are able to service your customers in uncontested at least for now space.
A pathbreaking strategy known as blue ocean strategy is a pacifist marketing scheme and is considered a strategic planning tool for assessing a business. The big difference is that blue ocean strategy introduced the tools and frameworks and concepts. Blue ocean strategy is a bad book, but it is not your usual bad book. Blue ocean strategy is the most successful book on business masterplanning the economist a great read for any leader looking to get a real edge in business and establish a real competitive advantage in the market. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking. The strategy canvas provides a highly visual tool to help look at future options. 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. Based on a study of 150 strategic moves, spanning more than 100 years across 30 industries, the authors, chan kim and renee mauborgne show that lasting success comes not. There is ample opportunity for growth that is both profitable and rapid. In a red ocean strategy, companies focus on existing customers and compete in existing market space. 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 make competition irrelevant.
Blue ocean strategy moves were common when technology was evolving into the common, household use that it experiences now. Rather than concentrating on beating the competitors, the company must actually prioritize on making the competition irrelevant. What is the main difference between the blue ocean. Blue ocean strategy, the global phenomenon that has sold 3. This happened, for example, when apple created its itunes music download service in 2003. May 31, 2016 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. A global bestseller and one of the best business strategy books available, blue. Of the many strategic planning models that exist, the blue ocean strategy could be considered the pacifist of the group. Successful trailblazing organizations will attract competition, creating a red ocean. With this groundbreaking book, kim and mauborgneboth professors at. Blue ocean shift is more of a how to guide that incorporates a lot of the ways to run a blue ocean strategy based programme within an organisation.
Chan kim and renee mauborgne brings together their perennial bestseller book blue ocean strategy with their classic articles blue ocean leadership and red ocean traps. The profit is much easier than the rivalry with the competition on existing markets. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. Embraced by organizations and industries worldwide, blue ocean strategy is a global phenomenon that has sold over 4 million copies, is published in a recordbreaking 46 languages and is a bestseller across five continents. Furthermore the blue ocean strategy was awarded with. Like the blue ocean, it is vast, deep and powerful in terms of opportunity and profitable growth. Blue ocean strategy blue ocean strategy is a business strategy book published in 2005 by harvard business school publishing corporation in united state of america, it was written by w.
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. A business model describes the rationale of how an organization creates, delivers, and captures value economic, social, cultural, or other forms of. It sold more than 4 million copies and has been translated into 44 different languages. There are two ways we can create a blue ocean strategy. Of course any strategy will always involve risks be it red or blue. Oct 24, 2017 the big difference is that blue ocean strategy introduced the tools and frameworks and concepts. How to create uncontested market space and make competition irrelevant w. Reviewing the blue ocean strategy universiteit twente. How to create uncontested market space and make competition irrelevant, is a market space that is undeveloped, and untapped by competitors. Blue ocean strategies are being seen more in societal and cultural convenience rather than mechanical devices. Back in 2008, i wrote a paper on blue ocean strategy which was published at the international conference on management. This is a business strategy book, more real and less fiction. 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.
Surface 3 and apple watch red oceans v blue oceans strategy. You may or may not agree with the central philosophy, but you will be inspired. History and background a video game console is just a computer that is made only. This blog article is a overview of some of the key points of the book by w. Long enough to describe the strategy and explain the pitfalls, but not padded too far. In this framechanging book, kim and mauborgne present a proven analytical. Chan kim, renee mauborgne 1999, strategy, value innovation, and the. It is all about devising and acquiring the uncontested market forum by spawning a new demand. Essay about blue ocean strategy 825 words bartleby. The blue ocean strategy book defines red oceans as those which already contain a high level of competition.
Blue ocean strategy suggests that an organization should create new demand in an uncontested market space. Blue vs red ocean endicott masters in international admin. 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. Red oceans of vicious competition, why not move to the blue oceans where there was. Blue ocean strategy can be found on amazon blue ocean strategy. Blue ocean strategy is an opportunitymaximising riskminimising strategy. Jul 30, 2017 this strategy can work in the short run but it is a lot wiser for people to fast embrace the blue ocean strategy. Value innovation strategy competes in an uncontested market space. Blue ocean strategy is a method of creating business strategy of the enterprise, which was described in a book by w. It became a huge bestseller, and remains popular today. Renee mauborgne of insead explains how a landmark idea is evolving. With technology becoming so common, the red ocean strategy has taken over the blue ocean strategy seen previously.
Before we dive into blue ocean strategy examples, lets get clear on what a blue ocean is. 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. The cornerstone of the blue ocean strategy is value innovation. Let us say the market that we operate is an ocean cle. According to the blue ocean strategy principles, companies should not only try to compete in existing markets red oceans, but. Jan 12, 2020 where red ocean strategy is a zerosum game that is all about splitting up the pie between rivals, blue ocean strategy is about creating the pie andor enlarging it. Chan kim and renee mauborgne of the blue ocean strategy institute and professors at frances insead business school and cofounders of the value innovation. A global bestseller and one of the best business strategy books available, blue ocean strategy challenges everything you thought you knew about strategic. Yet the book also shows that the kind of leadership and management needed to implement a blue ocean strategy initiative is very different. Buy books, tools, case studies, and articles on leadership, strategy, innovation, and other business and management topics. A red ocean is a metaphor for a market full of competitors. 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, outlines the processes of removing the fight for competitive advantage and the battle for differentiation typical of many corporate strategies.
The blue ocean strategy represents the simultaneous. In this article you will learn how to make your competition irrelevant and have sales and profit. Companies should instead look for new market space and ways to reinvent the industry. It presents a systematic approach to making the competition irrelevant and outlines principles and tools any organization can use to create and capture their own blue oceans. The economist a great read for any leader looking to get a real edge in business and establish a real competitive advantage in the market. The seminal book blue ocean strategy has sold over 3. The blue ocean strategy concerns itself with creating uncontested market space. One is by launching or introducing a completely new product, service, or concept. The strategy clearly brings out the fact that the only way to beat competition is to stop trying to beat it. Mauborgne, blue ocean strategy challenges companies to break out of the red ocean of.
This book brings the best of those articles together all in one place. Achieved via the delivery of features that have a highest marginal benefit to customer needs. A lot has been written about it and i would have said practically everything had been said about it until i looked up the book on amazon to see the current price. The blue ocean strategy is a book about finding your niche within a niche so you can. Blue ocean shift is the essential followup to blue ocean strategy, the classic and over 4 million copy global bestseller by worldrenowned professors chan kim and renee mauborgne drawing on more than a decade of new research, blue ocean shift is the definitive guide to help you move beyond competing, inspire your peoples confidence, and seize new growth. Chart a path to creating uncontested market space and winning the future. Chan kim and renee mauborgne 2006 blue ocean strategy has been described as a must read for all business students. Innovation, new market space and creating demand are central characteristics. Blue ocean strategy chan kim and renee mauborgne was released in 2005 by harvard business school press. These systems started to gain popularity in the 1970s with consoles that played only pong. Jul 11, 2016 red ocean marketing focuses on competition in the existing market space by directly competing with others.
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 market space that is filled. Sep 26, 2016 the strategy canvas provides a highly visual tool to help look at future options. All in all, blue ocean strategy is a book worth reading. In this summary, well give a synopsis of the key concepts, tools and tips from the book. First published in 2005, it was updated and expanded with fresh content in 2015. However, blue ocean strategy provides a robust mechanism to mitigate risks and increase the odds of success. 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. So blue ocean strategy is about how can any company or organization break out of the red ocean of bloody competition or existing market space, which tends to be very crowded and. Based on an eponymously titled book, this strategy argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. A blue ocean strategy is based on creating demand that is not currently in existence, rather than fighting over it with other companies. Red oceans, where competition is fierce in bloody waters, strategy centers around beating rivals, and wins are often zerosum.
As market power has moved from companies to consumers, and global. Blue ocean vs red ocean strategies 6 major differences. Jul, 2018 these new spaces are described as blue oceans, compared to the struggle for survival in bloody red oceans swarming with vicious competition. Blue oceans denote all the industries not in existence today the unknown market space, unexplored and untainted by competition. Blue ocean strategy is the most successful book on business masterplanning. 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. Although there is an inevitability to having to compete in crowded markets, there are too many advantages to avoiding this situation to ignore the possibility of looking for blue space. It is worth noting the organizations will move between blue oceans and red oceans over time. Recognized as one of the most iconic and impactful strategy books ever written, blue ocean strategy argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool.
A nice and easy reading book with many clear and understandable examples. This collection of work by globally preeminent management thinkers w. A company will have more success, fewer risks, and increased profits in a blue ocean market. What is blue ocean strategy about blue ocean strategy. So blue ocean strategy is about how can any company or organization break out of the red ocean of bloody competition or existing market space, which tends to.
Compete in existing market space create uncontested market space beat the competition make the competition irrelevant exploit existing demand create and capture new demand make the valuecost tradeoff break the valuecost tradeoff align the whole system of a firms activities with its strategic choice of differentiation or low cost. 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. A red ocean strategy involves competing in industries that are. Blue ocean strategy including examples and pdf download. Let me try to explain this in simple terms for the benefit of everyone. Sarah layton in blue ocean strategy on april 21, 2009. Why churches need blueocean strategies biblical leadership. Chan kim et renee mauborgne, chercheurs au blue ocean strategy institute.
Here is the book descriptions extracted from amazon. In the international bestseller blue ocean strategy, w. With a focus of not just beating your competition but making them irrelevant, blue ocean strategy is all about thinking outside the box. Blue ocean strategy proposes that businesses can have more success by creating a blue ocean, rather than trying to compete in the red ocean. This strategy can work in the short run but it is a lot wiser for people to fast embrace the blue ocean strategy. You must keep in mind that there is a deeper potential of the marketplace that hasnt been explored yet. Since, the industries are in a state of non existence, there is absolutely no relevance of peer. In blue oceans, demand is created rather than fought over. Blue ocean strategy the blue ocean approach is a strategic tool that helps innovation strategists asses current and desired future strategic states whereasred ocean is a current state. They represent businesses that may not be around today, or werent around until they came on to the scene.
Red ocean looks at cost saving or differentiation while blue ocean focuses on doing both. The chart above summarizes the distinct characteristics of competing in red oceans red ocean strategy. Blue ocean strategy is a marketing theory and the title of a book published in 2004 written by w. Red oceans are all the industries in existence today the.
May 14, 2020 the fundamental premise of the blue ocean strategy is that as opposed to continuing to compete in the red ocean, you should try to find new space in which to sell your goods and services. Take a look at this comparison between the two strategies published by sage growth partners. What is the main difference between the blue ocean strategy. The blue ocean strategy means that you find some aspect of your market that no one is doing, and try to dominate that, rather than fighting it out with other vendors in your space a red ocean strategy.
Red ocean in blue oceans, demand is created rather than fought over. Chan kim and renee mauborgne, professors at insead. We all know well about redblue ocean strategy, how each ocean colour are works. Mar 10, 2015 back in 2008, i wrote a paper on blue ocean strategy which was published at the international conference on management. Most blue oceans are created from within red oceans by expanding existing industry boundaries. Successful trailblazing organizations will attract competition, creating a. Based on a study of 150 strategic moves spanning more than 100 years.
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