A based on 15 years of research, the authors used 150 successful strategic moves spanning 120 years of business history and across 30 industries to bring the blue. Renee mauborgne is the insead distinguished fellow and a professor of strategy and. The theory of blue ocean leadership blue ocean strategy. The risks of following a blue ocean strategy the adaptive. Ocean strategy, sustainability, innovation, value, sustainable value, strategic management.
Pdf harvard business school press blue ocean strategy rajeh. From theory to practice case solution, the global market consists of two types of oceans. List the factors the customer cares about, and current dimensions of competition. From theory to practice case solution, red oceans and blue oceans. By focusing on strategies of competition in established industries, companies and researchers have overlooked the value of creating new market spaces where.
When expressed through a value curve, an effective blue ocean strategy has three complementary qualities. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. Download this document for strategy at maastricht university for free and find more useful. Download blue ocean strategy pdf including examples. Blue ocean strategy with boss business simulation stratx. Accordingly, yellow tail was a completely new combination of wine characteristics that produced an uncomplicated wine structure that was instantly appealing to the mass of alcohol drinkers. What is blue ocean strategy about blue ocean strategy. This paper presents a methodical and critical analysis of the key elements regarding the strategic management literature and 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. A company will have more success, fewer risks, and increased profits in a blue ocean market. Blue ocean strategy makes companies to come out of ocean of bloody competition by creating market space which is uncontested and that makes the completion irrelevant. Drawing on more than a decade of new work, kim and mauborgne show you how to move beyond competing, inspire your peoples confidence, and seize new growth, guiding you step by step through how to take your organization. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking away from the competition. It requires the right research, patience and focus.
The key theme in this article is that when businesses are faced with a choice of battling competition in saturated markets or creating an entirely new market. From theory to practice by focusing on strategies of competition in established industries, companies and. The study deals with the blue ocean strategy bos that offers users a framework for making uncontested market space and diverts the outlooks from the existing competition to the creation of. An introduction to blue ocean strategy mba knowledge base. This article explains the blue ocean strategy, developed by w. This article uses examples from the real world to discuss the specifics of the blue ocean strategy. Presents a set of analytical tools and frameworks that can enable firms to develop blue ocean. Chan kim and renae mauborgnea in their book blue ocean strategy.
Today, one can hardly speak of strategy without involving the language of competition. Here we explore how entrepreneurs around the globe are using blue ocean strategy to break out of the red ocean and achieve strong. Blue ocean strategy and the dynamic nature of business. But, lets first understand what is blue ocean and how it is different from red ocean strategy. Despite the fact that practice and theory are not well connected and that strategic management has so far failed to. Blue ocean strategy can be applied across sectors or businesses. Blue ocean strategy is referred to a market for a product where there is no competition or very less competition.
But wait, there was another blue ocean in the seventies according to the authors, when the japanese three competitors. To do so, the commercial offers of selected airlines were compared to validate any attempts to apply the blue ocean strategy concept. Blue ocean strategy is a new way of thinking, a new strategic mindset, a bold new path to winning the future. After reading you will understand the basics of this powerful strategy tool. The thesis tries to find whether all services are important to chinese 3g operators competiveness and how to create a. Companies pursue blue ocean strategies to make competition irrelevant. By focusing on strategies of competition in established industries, companies and researchers have overlooked the value of creating new market spaces where there are no competitors.
F or twentyfive years, competition has been at the heart of corporate strategy. Blue ocean shift is the essential followup to blue ocean strategy, the classic 3. To prosper in the future, companies need to go beyond competing. In this article you will learn how to make your competition irrelevant and have sales and profit. How to create uncontested market space and make the competition irrelevant by w. Blue ocean strategy tools and frameworks provide a compelling path to achieve just that. The market universe is composed of two types of oceans. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. How to create uncontested market space and the make competition irrelevant 2005. The niche strategy adopted by general motors increased overall market share from 20% to 50%. Blue ocean strategy has helped numerous companies and organisations across the globe to create new market space and achieve pro. Essay about blue ocean strategy 825 words bartleby.
The insight for blue ocean leadership, created by chan kim and renee mauborgne, is that leadership, in essence, can be thought of as a service that people in an organization either buy or dont buy. Blue ocean strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. Chan kim and renee mauborgne written by the business worlds new gurus, blue ocean strategy. Value innovation strategy competes in an uncontested market space. It was built on the notion of creating new markets where competition is irrelevant and the opportunity to grow and be profitable is unlimited. For twentyfive years, competition has been at the heart of corporate strategy. Instead, kim and mauborgne 2005a, b, and c and kim et al. Most business focus efforts on their current customers, for blue ocean strategy, focus on. Essay about blue ocean strategy 825 words 4 pages 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. Blue ocean strategy theory and criticism 1246 words.
We believe that blue ocean strategy will send you on the right path towards creating your own uncontested space. How to create uncontested market space and the make competition irrelevant 2005 is their book where it is very well. The strategy canvas visualizes the current state of the industry and shows how a blue ocean strategy differs from incumbents. This article explains what the blue ocean strategy is and how it can become a game changer for businesses stuck in stagnating markets. Since, dividing up existing demand and benchmarking the competitors, blue ocean strategy is regarding grow demand and break away from the competition. Article information, pdf download for blue ocean strategy. Presentation mode open print download current view. Blue ocean strategy and its implications for businesses. Tru group inc blue ocean strategy belongs in the dead sea. Blue oceans are all the industries not in existence today. Application of blue ocean strategy to chinese 3g mobile. So powerful is blue ocean strategy, in fact, that a blue ocean strategic move can create brand equity that lasts for decades. 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.
Article blue ocean strategy from theory to practice 2005. Chan kim renee mauborgne or twentyfive years, competition has been at the heart of corporate f. A third tool, the eliminatereduceraisecreate grid, pushes firms to act on all four questions posed by the four actions framework and to create a new value curve. The book titled blue ocean strategy is not helpful to management dont buy it and if you already have it dump it. Red oceans are all the industries in existence today, it is in. Though sound advice in practice this may put managers at risk for ignoring relevant competition. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. Blue ocean strategy including examples and pdf download. Although established industries red oceans are growing increasingly cluttered, few companies are currently attempting to create new markets. Chinese 3g mobile telecom industry is a rapidly growing multiple industry which served a lot of services to customers. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. The blue ocean strategy simulation was designed with extensive input from the authors of the bestselling book blue ocean strategy. You can discover how much you know about it, including why it was first considered confrontational, by using the quiz.
Presents a set of analytical tools and frameworks that can enable firms to develop blue ocean strategies. Henderson chair professor of strategy and international management at insead. Welcome to blue ocean strategy were thrilled to have you on board. 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. Yet poor understanding exists both in theory and in practice as to how to systematically create and capture blue oceans. From theory to practice case study solution, in the market of the universe is composed of two types of oceans. The concept of ideal strategy is developed in business. The blue ocean strategy explains how to guide your business across seas with less competition and greater profitability.
Despite the demand for an approach of this type, it has not yet been identified links between the theory from kim and mauborgne 2005 with the product development process pdp. Blue ocean strategists have always existed but for most part their strategies have been largely unconscious. This strategy revolves around searching for a business in which very few firms operate and where there is no pricing pressure. So far, blue ocean support relies on a data base of case studies that does not statistically analyze overall patterns. This article investigates the applicability of blue ocean strategy in regard to lowcost airlines in the civil airline industry. This framework is very innovative, as its principles challenge the conventional business strategy principles of fighting competitors headon. In this chapter, an indepth analysis of the theory behind the blue ocean strategy will be conducted to answer the question whether the blue ocean strategy valid and reliable on theoretical basis. 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.
Blue ocean strategy is a growth strategy framework focused on the idea of creating an uncontested market spacei. Blue ocean strategy and sustainability for strategic management. Red oceans are all the industries in existence today. From theory to practice, open epub for blue ocean strategy. The pdf download includes blue ocean strategy and examples. Your course participants will truly experience the power of blue ocean strategy by applying the theory and using the methodologies and tools described in the book.
If you have the appropriate software installed, you can download article citation data to the citation manager of your choice. The concept of blue ocean is based on the idea that the business universe is made up. Achieved via the delivery of features that have a highest marginal benefit to customer needs. Empirical validation of blue ocean strategy sustainability. Ebscohost serves thousands of libraries with premium essays, articles and other content including blue ocean strategy. Blue ocean strategy is a landmark idea founded by w. Blue ocean strategy and the dynamic nature of business strategies. How to create uncontested market space and make competition irrelevant by w. What is distinctive about blue ocean strategy as a theory. This blog article is a overview of some of the key points of the book by w. Blue ocean strategy introduces analytical tools to minimize risk. 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. From theory to practice beer and readytodrink cocktails, for example, were much sweeter and easier to drink.
Eight key points of blue ocean strategy heres the essence of blue ocean strategy captured in eight key points. Along with the theory, the book presents tools and frameworks to help an organization create and capture blue oceans in a systematic manner. The idea in brief the best way to drive profitable growth. Tru group inc strategic planning consultants white paper download. Blue ocean strategy and sustainability for strategic. 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. From theory to practice case analysis, blue ocean strategy. 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. The purpose of this study was to apply blue ocean strategy to chinese 3g mobile telecom industry. The concept of ideal strategy and its realization using white. Value innovation value innovation is created in the region where a companys actions favorably affect both its cost structure and its value proposition to buyers. Blue ocean strategy is a book published in 2005 and written by w. Red oceans are all the industries that exist today, are increasingly charact. 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 is a concept that has been pioneered by insead professors, w. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking. How to create uncontested market space and make the competition irrelevant, a. How is blue ocean strategy different from a classic differentiation strategy. Thumbnails document outline attachments find more documents from this course strategy blue ocean strategy from theory to practice summary. Eliminatereduceraisecreate grid for the case of yellow tail blue ocean strategy. Blue ocean strategy from theory to practice summary. 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.
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