...COLOURS WHAT IS PINK? A ROSE IS PINK BY THE FOUNTAIN’S BRINK. WHAT IS RED? A POPPY’S RED IN IT’S BARLEY BED. WHAT IS BLUE? THE SKY IS BLUE WHERE THE CLOUD FLOAT THROUGH. WHAT IS WHITE? A SWAN IS WHTTE SAILING IN THE LIGHT . WHAT IS GREEN? THE GRASS IS GREEN WITH SMALL FLOWERS BETWEEN. WHAT IS VIOLET? CLOUDS ARE VIOLET IN THE SUMMER TWILIGHT . WHAT IS ORANGE? WHY, AN ORANGE, JUST AN ORANGE! -CHRISTINA ROSSETTI- FLINT AN EMERALD IS AS GREEN AS GARSS, A RUBY RED AS BLOOD; A SAPPHIRE SHINES AS BLUE AS HEAVEN; A FLINT LIES IN THE MUD. A DIAMOND IS A BRILLIANT STONE, TO CATCH THE WORLD’S DESIRE; AN OPAL HOLDS A FIERY SPARK; BUT FLINT HOLDS FIRE. -CHRISTINA ROSSETTI- THE WORKS OF GOD ALL THINGS BRIGHT AND BEAUTIFUL, ALL CREATURES GREAT AND SMALL, ALL THINGS WISE AND WONDERFUL- THE GOOD GOD MADE THEM ALL. EACH LITTLE FLOWER THAT OPENS, EACH LITTLE BIRD THAT SINGS- HE MADE THEIR GLOWING COLOURS, HE MADE THEIR TINY WINGS. THE PURPLE-HEADED MOUNTAIN, THE RIVER RUNNING BY, THE MORNING AND THE SUNSET THAT BRIGHTEN UP THE SKY; THE TALL TREES IN THE GREENWOOD, THE PLEASANT SUMMER SUN, THE RIPE FRUITS IN THE GARDEN- HE MADE THEM EVERYONE. HE GAVE US EYES TO SEE THEM, AND LIPS THAT WE MIGHT TELL, HOW GREAT IS GOD ALMIGHTY, WHO HAS MADE ALL THINGS WELL. -C.F. ALEXANDER- THE WORLD IS MINE ...
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...LITERATURE REVIEW BLUE OCEAN STRATEGY BY W. CHAN KIM AND RENÉE MAUBORGNE Mirko Hagendorf AGENDA I. Introduction of authors II. The Blue Ocean Strategy Definitions of Red and Blue Oceans Characteristics Summary Success and examples III. Critical reflection of the strategy IV. Discussion and questions 2 I. INTRODUCTION OF AUTHORS W. Chan Kim & Renée Mauborgne Work together at INSEAD (Institut Européen d´Administration des Affair, France) Both as Co‐Director of “INSEAD Blue Ocean Strategy Institute” Kim: Bruce D. Henderson Chair Professor of Boston Consulting Group for Strategy and International Management Mauborgne: Professor for Strategy Member of President Barack Obama’s Board of Advisors Ranked No. 2 in The Thinkers50 listing of the World’s Top Management Gurus 3 II. THE BLUE OCEAN STRATEGY DEFINITION Red Ocean “represent all the industries in existence today ‒ the known market space (…) [where] companies try to outperform their rivals in order to grab a greater share of existing demand.” • Roots in military thinking on strategy • “Structuralist view” or “environmental determinism” • Situation in many industries lead to shrunk profit margins 4 II. THE BLUE OCEAN STRATEGY DEFINITION Blue Ocean “denote all the industries not in existence today (…) [where] , demand is created rather than fought over.” • “reconstructionist view” • Creation ‐ “give rise to completely new industries” ...
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...Blue Ocean Strategy MARKETING Individual assessment: Blue ocean strategy Do you think that the blue ocean strategy is a relevant tool to generate innovation, value and new customer? Summarize the benefits and the limitation of this strategy. What can corporate do to minimize the impact of this unavoidable imitation/competition? 1. Blue Ocean Strategy (BOS): Benefits, limitations and risks Blue Ocean Strategy signifies all the industries which are not in existence today. In this kind of strategy, the market spaces are unfamiliar, unpolluted by competition. In this strategy, the demand is created rather than fought over. There is sufficient chance for growth which is swift and profitable. Competition is inappropriate because the rules of the game are waiting to be set. 1.1. Benefits of Blue Ocean Strategy The Blue Ocean Strategy is appropriate tool to generate innovation, value and new customers. Considering the condition of CLV it is suitable for this organization to go for it to generate value and innovation. This strategy encourages organizations to attain new ways of thinking which are different than the competitors. With the help of this strategy, organizations can create a new area of demand namely a Blue Ocean and get rid of an intensely competitive market namely a Red Ocean. When any organization successfully creates new markets without competitors they can have a clear Blue Ocean. According to this strategy the organizations must not only focus on...
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...S p r i n g 2 0 0 5 | V o l . 4 7 , N o . 3 | R E P R I N T S E R I E S Canifgernia ala oment M Review Blue Ocean Strategy: From Theory to Practice W. Chan Kim Renée Mauborgne © 2005 by The Regents of the University of California Blue Ocean Strategy: FROM THEORY TO PRACTICE W. Chan Kim Renée Mauborgne or twenty-five years, competition has been at the heart of corporate strategy. Today, one can hardly speak of strategy without involving the language of competition: competitive strategy, competitive benchmarking, building competitive advantages, and beating the competition. Such focus on the competition traces back to corporate strategy’s roots in military strategy. The very language of corporate strategy is deeply imbued with military references—chief executive “officers” in “headquarters,” “troops” on the “front lines,” and fighting over a defined battlefield.1 Industrial organization (IO) economics gave formal expression to the prominent importance of competition to firms’ success. IO economics suggests a causal flow from market structure to conduct and performance.2 Here, market structure, given by supply and demand conditions, shapes sellers’ and buyers’ conduct, which, in turn, determines end performance.3 The academics call this the structuralist view, or environmental determinism. Taking market structure as given, much as military strategy takes land as given, such a view drives companies to try to carve out a defensible position against...
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...Blue Ocean Strategy, a book by W. Chan Kim and Renee Mauborgne, develops and explains how to beat the competition by reaching beyond it into new unexplored markets. The authors use the metaphor of the blue ocean as a direct contrast to red oceans. Red oceans are the battling grounds for typical market competition where firms fight for an already defined and stagnate market. Blue oceans, on the other hand, describe a strategy that breaks away from the blood red ocean into clear, uncharted oceans, or new markets (see Appendix A for the details of the differences). The authors studied the business launches of 108 companies, more than 150 strategic moves from 1880 to 2000, and more than 30 industries to uncover the key traits and practices of what they call "Blue Ocean Strategy." Kicking off the book with four analytical tools that promise to help firms find and exploit untapped markets, the authors offer a step by step approach, comprised of six principles, on how to break away from the competition of red oceans and execute a blue ocean strategy. They show how and why a blue ocean strategy leads to a market where competition is - for a time - obsolete. Each principle is explained and supported by real world examples from such companies as Ford, Cirque du Soleil, Dell Computers, Casella Wines, and even the New York City Police Department. The chart, figure 1, illustrates both the concept of blue ocean strategies, and the organization of the book, Blue Ocean Strategies. Lady...
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...Background Blue ocean strategy was published in Oct 2004 by Harvard Business Review. Written by W. Chan Kim and Renee Mauborgne, the article became one of the most popular articles in the history of HBR. Although the article has been appreciated by academicians, workers, corporate honchos, consultants alike, there are many flaws in the article which remain unattended to. Kim and Mauborgne studied about one hundred fifty positions made from 1880 to 2000 in more than thirty industries and closely examined the relevant business players in each. They analyzed the winning business players as well as the less successful competitors. Studied industries included hotels, cinemas, retail stores, airlines, energy, construction, Publishing, automotive and steel. They searched for convergence among the more and less successful players. Divergence across the two groups was also studied to discover the common factors leading to strong growth and the key differences separating those winners from the mere survivors and the losers. Kim and Mauborgne defined a consistent and common pattern across all the seemingly idiosyncratic success Research results were first published in 1997 in a Harvard Business Review article by Kim and Mauborgne titled "Value Innovation: The Strategic Logic of High Growth". The ideas, tools and frameworks were tested and refined over the years in corporate practice in Europe, the United States and Asia and presented in the following eight additional articles with “blue ocean...
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...Blue Ocean Strategy Eric Montoya MKT/421 February 12, 2015 William Gay Blue Ocean Strategy The Blue Ocean Strategy focuses on three big industries that touch thousands of people’s lives. The areas in which they look at are Autos, Movies and Computers. What companies in those fields are doing into managing their profit and growth through times? Creation of blue ocean strategy placed its focus on very good strategic moves in order to place their brand in a position which long past its rise to fame. Blue ocean strategy gears to forecasting innovations and products to make oceans of uncontested market space. (W. Kim, 2004). The blue ocean strategy takes a look at the host of companies in the more than thirty plus industries and the key players within them. The blue ocean strategy is the process of analyzing and studying the successful players and the unsuccessful ones and failing in their competition. Looking for most distinct and more common differences between those groups, as well as commonalities to discover the most common factors leading to the successful growth of those and failings of the other. The common practice is within the market place the competition style strategy has little advantages to it. (W. Kim, 2004). The unrelated old school theory that is out doing the competitors was most obvious road to take that leads when it comes to profit and success. Placing a value in innovation and creation can give itself to a new demand achieving a value that has enormously...
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...Mauborgne authors of BLUE OCEAN STRATEGY 1) What is a blue ocean strategy? Kim & Mauborgne: Blue Ocean Strategy is a way to make the competition irrelevant by creating a leap in value for both the company and its customers. 2) What are red and blue oceans, and why do you use the colors red and blue? Kim & Mauborgne: We use the terms red and blue oceans to describe the market universe. Red oceans are all the industries in existence today—the known market space. 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 existing demand. As the market space gets crowded, prospects for profits and growth are reduced. Products become commodities, and cutthroat competition turns the red ocean bloody. Hence, the term “red” oceans. Blue oceans, in contrast, denote all the industries not in existence today—the unknown market space, untainted by competition. 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. Blue ocean is an analogy to describe the wider, deeper potential of market space that is not yet explored. Like the “blue” ocean, it is vast, deep, powerful, in terms of profitable growth, and infinite. 3) How does blue ocean strategy fundamentally...
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...a leap into the blue ocean W. Chan Kim is The Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International Management at INSEAD. ´ Renee Mauborgne is The INSEAD Distinguished Fellow and a professor of strategy and management at INSEAD. This article is based on their book, Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business School Press, 2005). orporate strategy is heavily influenced by its military roots. The very language of strategy is imbued with military references – chief executive ‘‘officers’’ in ‘‘headquarters’’, ‘‘troops’’ on the ‘‘front lines.’’ Described this way, strategy is about confronting an opponent and fighting over a given piece of land that is both limited and constant. Traditionally, strategy focused on beating the competition, and strategic plans are still couched in warlike terminology. They exhort companies to seize competitive advantage, battle for market share, and fight over price. Competition is a bloody battlefield. C The trouble is that if the opposing army is doing exactly same thing, such strategies often cancel each other out, or trigger immediate tit-for-tat retaliation. Strategy quickly reverts to tactical opportunism. So where should companies turn for a more innovative approach to strategy? The answer lies with something we call blue-ocean strategy. We argue that head-to-head competition results in nothing but a bloody red ocean as rivals fight over...
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...thought of as an ocean. The ocean can be divided into two segments: the red ocean and the blue ocean. The red ocean is comprised of existing market segments and this space contains all things in existence today. The competition in this space is fierce. Conversely, the blue ocean represents all things not in existence today or the opportunity to reengineer an established industry. The framework for formulating a Blue Ocean Strategy is explained in the following paragraphs. The first principle is reconstructing market boundaries. When creating a Blue Ocean Strategy, an entrepreneur must look within an existing industry and think beyond the current boundaries. Reengineering an established practice within an industry or creating something new will enable an entrepreneur to create a new market segment or maybe even a new industry. The company should look across alternative industries, consumer groups, and at other products or services that may help complement their own. By utilizing this cross-cultural approach, opportunity is created for the growth and development of a new market. The second principle when initially creating a strategy is for an entrepreneur to focus on the big picture and not the details. If the big picture is understood, the details will be easier to put into place. Without a big picture focus, creativity and innovation could get lost in the details. Corporate strategy must include big picture thinking. Breaking into a blue ocean market requires...
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...Kim and Mauborgne’s (2004) article explain that a vast majority of companies focus on stating in the “red ocean” as they are fighting over customers in the same market share. This author explains the reason behind this is that most companies use “competition-based red ocean strategies which has also seen them cut cost and take market share from rivalry competitors. As oppose to focusing on the “ red ocean” Kim and Mauborgne (2004) mention company’s need to begin shifting toward the “blue ocean” if they want to succeed. This can be achieved by offering differentiated products or services; it too can be achieved through reaching out and attracting a different target market. By doing this the author states that they will be moving into an “untapped market space” from this the companies will seek new opportunities and ultimately become more profitable. Companies that have utilized this model and been successful or Cirque du Soleil, both of these company’s have been able to expand because they offer a different value proposition to their customers. By using the blue ocean strategy it meant to enable the company to put more of an emphasis on focusing on the bigger picture, then having an immediate return on investment. In relation to Mikes Bikes we are currently competing in a “red ocean”, as there is high competition since each team are selling similar products, we are also faced with the same opportunities within the market. Furthermore everyone has a mutual vision of wanting...
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...Sunsilk Lively Clean & Fresh – Blue Ocean Strategy? Khurram Abbas | September 19, 2011 It was a very creative thought, when a very famous writer whose name no one knows, once said “When all think alike, then no one is thinking”. But the idea struck everybody, and we all understood the importance of innovation and creativity and standing out as an individual, group or as a team meant. Similarly, each brand is different and needs to stand-out being unique and innovative in approach and strategy. Here is where the Blue Ocean Strategy (BOS) sets in. Let’s just start this discussion by understanding what Blue Ocean Strategy really is? Blue ocean strategy is 1. Make uncontested market space 2. The aim of BOS is not to out-perform the competition in the existing industry, but to create new market space or a blue ocean, thereby making the competition irrelevant. 3. Create and capture new demand 4. The simultaneous pursuit of differentiation and low cost When I saw the Sunsilk Lively Clean and Fresh campaign with Ayaan Ali wearing a scarf (sure it was eye candy), the ad proclaiming “Hijaab se Dhakay Baloun k Liay” it occurred to me that Sunsilk’s Marketing was entering a new dimension. This was a classic case of Blue ocean strategy; they were reaching beyond existing demand by positioning this brand extension towards all young girls and women who cover their hair as part of religion, but are modern and fashionable, contemporary yet elegant at the same time, who wear a scarf socially...
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...Blue Ocean Strategy Velez, Joshua T. MKT/421 November, 05, 2015 Mr. Allauddin Blue Ocean Strategy Throughout time people, business, companies, and consumers have been trying to compete with one another to create the “next best thing”. In doing this most of the time people are taking something that is already in existence and working to make it more successful, or create a better version of it. However there are the real innovators that think outside of the box and really create something that is new and ahead of its time. These are the type of people that fall into the classification of the “Blue Ocean Strategy”. There is also the person that has a different mindset and get in their own way with a closed minded style of thinking which is known as “Red Oceans”. Really being innovative is how we push our civilization to continue to grow and be great. The Blue Ocean strategy is a concept that was created by W. Chan Kim and Renee Mauborgne that tells us if we want to be creative and innovative we have to take a product and completely unique so as to entice consumers to want what we have. In the Red Oceans there are many products circulating that are basically the same and they pretty much become unattractive to the public. The average consumer wants something new and exciting, or they want something that is comparable to what is already out there, but it has or does something to set itself apart from the rest of the pack. Creating that one product that no one else produces...
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...authors of BLUE OCEAN STRATEGY 1) What is a blue ocean strategy? Kim & Mauborgne: Blue Ocean Strategy is a way to make the competition irrelevant by creating a leap in value for both the company and its customers. 2) What are red and blue oceans, and why do you use the colors red and blue? Kim & Mauborgne: We use the terms red and blue oceans to describe the market universe. Red oceans are all the industries in existence today—the known market space. 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 existing demand. As the market space gets crowded, prospects for profits and growth are reduced. Products become commodities, and cutthroat competition turns the red ocean bloody. Hence, the term “red” oceans. Blue oceans, in contrast, denote all the industries not in existence today—the unknown market space, untainted by competition. 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. Blue ocean is an analogy to describe the wider, deeper potential of market space that is not yet explored. Like the “blue” ocean, it is vast, deep, powerful, in terms of profitable growth, and infinite. 3) How does blue ocean strategy fundamentally differ from red ocean strategy...
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...Blue Ocean Strategy: Article Summary Abstract The Blue Ocean Strategy (BOS) is a business strategy about capturing uncontested market space, thereby making competition irrelevant. The corner-stone of BOS is 'Value Innovation'. A blue ocean is created when a company achieves value innovation that creates value simultaneously for both the buyer and the company. The innovation (in product, service, or delivery) must raise and create value for the market, while simultaneously reducing or eliminating features or services that are less valued by the current or future market. The "ocean" in the title refers to the market or industry: • Blue Oceans are untapped and uncontested market, which provides little or no competition for anyone who would dive in, since the market is not crowded. • Red Oceans, on the other hand, refers to a saturated market where there are fierce competitions, already crowded with companies providing the same type of services, producing the same kind of goods. The idea is to do something different from everyone else, produce something that no one has yet seen, thereby creating a blue ocean. Blue Ocean Strategy: Article Summary BOS explains that rather than competing within the confines of existing industry or trying to steal customers from rivals (Red Ocean Strategy), uncontested market space should be developed that makes competition irrelevant. Red oceans are all the industries in existence today—the known market space. In the red...
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