Strategy canvas the strategy canvas is both a diagnostic and an action framework for building a compelling blue ocean strategy. For app developers we help make the competition irrelevant. 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. Blue ocean strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. Renew blue ocean as much as possible and remove any renewal risk.
Blue ocean strategy is about offering alternative services that have different functions and forms but the same purpose. A instead of competing in existing industries, blue ocean strategy equips companies with frameworks and analytic tools to create their own blue ocean of. What is distinctive about blue ocean strategy as a. This session contrasts the bos approach with the ros approach. Blue ocean strategy including examples and pdf download. Six sigma vs blue ocean strategy in order to succeed in a capitalistic society, a business must have a defined edge over its competition. With the launch of itunes, apple unlocked a blue ocean of new market space in digital music that it has now dominated for more than a decade. Each of the six principles in blue ocean strategy expressly addresses how to mitigate. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. Achieved via the delivery of features that have a highest marginal benefit to customer needs. The second part describes the four principles of blue ocean strategy formulation. 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. Blue ocean strategy seeks to make the competition irrelevant by creating a leap in value for both the company and its buyers. Apr 10, 2012 blue ocean strategy blue ocean strategy tools bos strategy tools six principles of blue ocean formulating blue ocean strategy the principles that drive the successful formulation are reconstruct market boundaries, focus on the big picture, not numbers, reach beyond existing reconstruct market focus on the big demand, and get the strategic.
May 26, 2015 summary of the first four chapters of the international bestseller blue ocean strategy. In fact, breaking out of boundaries is the first principle of the blue ocean strategy and based on that principle the six paths framework was created. Blue ocean strategy, red ocean strategy, guerilla marketing, globalized. Chan kim and renee mauborgne, professors at insead. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. Also, they serve as essential pointers about their future strategy. But, lets first understand what is blue ocean and how it is different from red ocean strategy. How is blue ocean strategy different from a classic differentiation strategy. Made by group d of the minor global trendwatching 2015. Chan, mauborgne, renee, mauborgne, renee a download it once and read it on your kindle device, pc, phones or tablets. All these principles can serve all sorts of companies, no matter the industry they are in.
The six paths framework in formulating blue ocean strategy. Eight key points of blue ocean strategy heres the essence of blue ocean strategy captured in eight key points. Expertise in saas deployment to the accounting profession and small to medium sized business owners, blue ocean principles works with vendors to create strategies that increase user adoption and partnerships to support growth initiatives. Jun 08, 2007 the six principles of blue ocean strategy risk factor each principle attenuates evaluation principles risk factor each principle attenuates formulation principles 8. On the other hand, there is not really an analytic framework to create blue oceans and principles to effectively manage the risk. Blue ocean strategy focuses on the ability to create new market space where there is no competition and where the demand for the services becomes uncontested. Blue ocean strategy is based on a decade long study of more than 150 strategic moves spanning more than 30 industries over 100 years. What is blue ocean strategy about blue ocean strategy. How to create uncontested market space and make the competition irrelevant kindle edition by kim, w.
Blue ocean strategy is the most successful book on business masterplanning. An introduction to blue ocean strategy mba knowledge base. The bluest ocean strategy for emerging ict business. This blog article is a overview of some of the key points of the book by w. It is the intersection between these analytic techniques and the six principles of formulating and executing blue oceans that allow companies to break from the. Blue ocean strategy provides a systematic approach to break out of the red ocean of severe competition and make the competition irrelevant by reconstructing market boundaries to create a leap in value for both the company and its buyers. Blue ocean strategy value innovation strategy canvas four actions framework errc grid six paths framework pioneer migrator settler map three tiers of noncustomers sequence of creating a blue ocean buyer utility map price corridor of the mass four hurdles to strategy execution tipping point leadership fair process. Companies go to great lengths in order to develop their competitive edge. This is where the concept of value innovation is placed as the cornerstone of this strategy, and the six principles of blue ocean strategy are introduced, the latter. That is why i am suggesting that blue ocean strategy principles lend themselves well to the education sector. 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.
Here are a couple of examples of companies whove successfully implemented the blue ocean strategy to grow their. Six principals of blue ocean strategy 1 reconstruct market boundaries. How to create uncontested market space and make competition irrelevant w. Principles of blue ocean strategy strategic management. Six paths framework blue ocean shift blue ocean strategy. Apr 26, 2012 now, i would like to emphasize the difference between porters five forces and blue ocean strategy for a deeper understanding of what it is all about. Business strategy frameworks provide the following benefits. Help you attract groups of customers that you wouldnt attract using traditional strategies in your industry.
Use a visualizing approach to focus on the big picture. Blue ocean strategy that supports creating uncontested market spaces has also been discussed highlighting its methodology principles that apply all types of industries. Help you structure your organization so that you can serve your customers needs faster and more efficiently. There are six basic approaches to reconstruct market boundaries, also known as six paths framework.
Blue ocean strategy powerpoint templates present better. Principles of blue ocean strategy strategic management business. As the blue ocean perspective rests heavily on identifying new and. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. Presentation of the bos concepts and principles, supported by case studies including nintendo wii, red one, cirque du soleil, mpesa and many more. Summary of the first four chapters of the international bestseller blue ocean strategy. The following are 21 business strategy frameworks that are. The six main principles guide companies through the formulation and execution of blue ocean strategy in a systematic, riskminimizing manner. Principles of blue ocean strategy are the six main principles that guide companies through the formulation and execution of their blue ocean strategy in a systematic risk minimizing and opportunity maximizing manner. The blue ocean strategy offers users a framework for creating uncontested market. Blue ocean strategy workshop workshop format the 2day workshop will have 4 working sessions each, containing. In this article you will learn the plan they outline for how to make your competition irrelevant and have sales and profit growth in excess of anything you thought was even possible. 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. Blue ocean strategy how to create uncontested market space.
However, the price competition only results in a red. Venturing beyond an existing industry space implies a series of risks. The principles of the blue ocean strategy 1080 words cram. It may be the technological advancement of its products or services, its cuttingedge marketing programs, or the way. Blue ocean strategy is about value innovation in general, in which no emphasis is put on reducing the speed to market. The principles of blue ocean strategy 1207 words bartleby. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. 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. Blue ocean strategy formulation the four principles of. Principles of blue ocean strategy free download as word doc. Provides stepbystep process provides a stepped process for implementation gives management an alternative to traditional strategies 6.
Blue ocean strategy formulation the four principles of strategy formation this blog article is a summary of the book by w. In blue oceans, demand is created rather than fought over. Chan kim and renee mauborgne, develops and explains how to beat the competition by reaching beyond it into new unexplored markets. Most prominently, since 2009 the malaysian government has implemented a national blue ocean strategy to lift the living standard of the country and to. 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. 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. What is distinctive about blue ocean strategy as a theory. The six principles of blue ocean strategy risk factor each principle attenuates evaluation principles risk factor each principle attenuates formulation principles 8. Lastly, the blue ocean strategy shows you how to create a winwin outcome. These four formulation principles address how an organization can create blue oceans by looking across the six. Maximizes opportunityminimizes risk mitigates risk increases odds of success 7. The blue ocean strategy approach to strategy is based on six principles that cater for the major risks of a new market creation project. It is based on the view that market boundaries and industry structure are not a given and can be.
Sep 24, 2017 blue ocean strategy requires a different mindset. A company will have more success, fewer risks, and increased profits in a blue ocean market. They have seen that the trouble lies in managers mental modelsingrained assumptions and. Blue ocean strategy bos is the simultaneous pursuit of differentiation and lowcost to create new market space. Reviewing the blue ocean strategy university of twente student. The authors of the bestselling blue ocean strategy have spent over a decade exploring that question. Jul 28, 2018 blue ocean strategy provides a systematic approach to break out of the red ocean of severe competition and make the competition irrelevant by reconstructing market boundaries to create a leap in value for both the company and its buyers.
Strategy in a practical way the study of six principles play a significant role 4. Blue ocean strategies are more about risk minimization and less about risk taking. The evolution of blue ocean strategy ims engineering college. Now, i would like to emphasize the difference between porters five forces and blue ocean strategy for a deeper understanding of what it is all about. Blue ocean strategy and its implications for businesses.
Blue ocean strategy can be applied across sectors or businesses. Apple observed the flood of illegal music file sharing that began in the late 1990s, enabled by file sharing programs such as napster, kazaa, and limewire. Our aim is to make the formulation and execution of blue ocean strategy as systematic and actionable as competing in the red waters of known market space. Keywords blue oceans, value innovation, four action framework, strategy. The authors use the metaphor of the blue ocean as a direct contrast to red oceans. Blue ocean strategy how to create uncontested market space and make the competition irrelevant boston. Built on common strategic patterns of blue ocean strategy. Identify the direction that leads to blue ocean opportunities. Kim and mauborgne point out that untapped value is often hidden in complementary products and. Value innovation strategy competes in an uncontested market space. Use features like bookmarks, note taking and highlighting while reading blue ocean strategy, expanded edition.
Students will gain an appreciation for the fundamental differences between red ocean strategy and blue ocean strategy and the key concepts of blue ocean strategy, particularly the notions of value innovation, reconstructing market. Six principles of blue ocean strategy there are six main principles that guide companies through the formulation and execution of their blue ocean strategy in a systematic risk minimizing and opportunity maximizing manner. Wide range of products environmentfriendly 2 reach beyond existing demand welldesigned furniture experience room freedom to touch the ikea restaurant six principals of blue ocean strategy. To break from competition, a organization has to reconstruct the market boundary which is the first and foremost principle in creating blue ocean strategy. The first four principles address blue ocean strategy formulation. How to create uncontested market space and make the competition irrelevant, a book by professors w. Blue ocean strategy is referred to a market for a product where there is no competition or very less competition. 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. Industries ranged from hotels, cinema, retail, airlines, energy, computers, broadcasting, and construction to automobiles and steel. One of the principles of blue ocean strategy is reconstruct market boundaries to separate competition and create blue oceans. Applying these core principles into your strategy will guide you in creating the right blue ocean strategy for your business. Porters model is based on the insight that a corporate strategy should meet the opportunities and threats in the organizations external environment. Blue ocean strategy is a book published in 2005 and written by w. The six paths challenge six assumptions that companies tend to follow while creating their red ocean strategies.