The creation of blue oceans is about driving costs down while simultaneously driving value up for buyers. 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 is referred to a market for a product where there is no competition or very less competition. How to create uncontested market space and make the. If you are going to create a blue ocean from within a red ocean the key tool to use is a value curve. The value curvea graphic depiction of the way a company or an industry configures its offering to customersis a powerful tool for creating new market space. Pdf harvard business school press blue ocean strategy rajeh. Value innovation value innovation is created in the region where a companys actions favorably affect both its cost structure and its value proposition to. The two are professors at insead and codirectors of the insead blue ocean strategy institute. Chan kim and renee mauborgne, it sold more than a million copies within its first year of publication and has. When expressed through a value curve, an effective blue ocean strategy has three complementary qualities. Blue ocean strategy is a book published in 2005 and written by w. A new business can create an uncontested market space or a blue ocean, by challenging the industrys strategic logic and existing business models. The four actions framework is used to add new values to the strategic canvas value curve.
Now updated with fresh content from the authors, blue ocean strategy. Blue ocean strategy is a landmark idea founded by w. It was expanded upon in their bestselling 2005 book, blue ocean strategy. Framework to reconstruct buyer value elements in crafting a new value curve. With all these four actions framework the company can escape the transitional red ocean market by activate a new blue ocean market and create a new value curve. If a company can identify what consumers currently value and then rethink how to provide that value, differentiation and low cost can both be achieved. After having dealt with the blue ocean metaphor as well as having clarified the concept of value innovation, the chapter moves on by describing the basic. This strategy revolves around searching for a business in which very few firms operate and where there is no pricing pressure. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. Beyond competing proven steps to inspire confidence and seize new growth hardcover september 26, 2017. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking.
The actual relationship of the authors to the company case examples in. A blue ocean strategy the first question the value curves answer is whether a business deserves to be a winner. Made by group d of the minor global trendwatching 2015. Blue ocean strategy pdf blue ocean strategy blue ocean strategy 2004 five keys to blue ocean strategy blue ocean strategy expanded edition book summary blue ocean strategy blue ocean strategy book by w. The four actions of creating a new value curve should be well guided toward building a. Blue ocean strategy case study service nsw 3 1 introduction blue ocean strategy1 has been used extensively to transform the public sector around the world at a local, state and national level. But its not always clear how to create a blue ocean strategy for yourself. The cornerstone of blue ocean strategy what consistently. Use features like bookmarks, note taking and highlighting while reading blue ocean strategy, expanded edition. May 26, 2015 summary of the first four chapters of the international bestseller blue ocean strategy. Blue ocean strategy is about defining a new value curve that creates more customer value at lower cost. There are a range of tools that can be used in formulating blue ocean strategy, all of which are laid out in the megabestselling book blue ocean strategy.
When a companys value curve, or its competitors, meets the three criteria that define a good blue ocean strategyfocus, divergence, and a compelling tagline that speaks to the marketthe company is on the right track. Blue ocean strategy displays an orderly way to deal with making the challenge unessential and traces standards and instruments any organization can use to make and catch their blue seas. Value innovation the cornerstone of bos value innovation places equal emphasis on value and innovation. Tools and frameworks for creating and capturing blue oceans it is constructed to create a new value curve and when you apply the four actions framework to the strategy canvas of your industry, you get a. This blog article is part of a series on the book blue ocean strategy by w. Of the many strategic planning models that exist, the blue ocean strategy could be considered the pacifist of the group. 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. Built on common strategic patterns of blue ocean strategy. It was built on the notion of creating new markets where competition is irrelevant and the opportunity to grow and be profitable is unlimited.
Eliminatereduceraisecreate grid errc grid blue ocean. Jul 17, 2018 when these four questions are answered, you will then be able to come up with a new value curve to unlock your companys very own blue ocean. Companies should instead look for new market space and ways to reinvent the industry. An introduction to blue ocean strategy mba knowledge base. 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. While lean six sigma is great for optimizing existing processes, it can sometimes inhibit the development of new products and markets. Chan kim and renee mauborgne in the indie business book club.
When these four questions are answered, you will then be able to come up with a new value curve to unlock your companys very own blue ocean. Errc grid for the shorthaul airline industry eliminate. Summary of the first four chapters of the international bestseller blue ocean strategy. Over my years of working with clients on strategy formulation ive frequently. Blue ocean strategy and sustainability for strategic management. Figure 2 value innovation blue ocean strategy, 2015. Sep 24, 2017 in effect, blue ocean strategy involves marketcreating innovation. The authors use the term blue ocean strategy to refer to the new management approach they are selling in their book.
Blue ocean strategy available for download and read online in other formats. In their 2017 new york times bestselling book, blue ocean shift, kim and mauborgne share how to put these practical marketcreating tools into practice to move from red to blue oceans and to do so in a way that people own and drive the process. The authors use the metaphor of the blue ocean as a direct contrast to red oceans. Chan kim and renee mauborgne, professors at insead. The book is intended for all businessmen from various industries, those eager to learn new ways, techniques, methods, and strategies that are not only beneficial in the business world but also in other aspects of life. Blue ocean strategy powerpoint templates present better. Achieved via the delivery of features that have a highest marginal benefit to customer needs. The seminal book blue ocean strategy has sold over 3. The value curve is a graphic depiction of the way a company configures its offering to customers. Value innovation is created in the region where a companys actions favorably. Blue ocean strategy, expanded edition harvard business publishing. Blue ocean strategy book isnt suitable only for the business. It will show you what it takes to shift from bloody competition to new markets.
This blog article is a overview of some of the key points of the book by w. Recognized as one of the most iconic and impactful strategy books ever written, blue. To start thinking outside of the box, you might want to create a blue ocean strategy. Jul 16, 2015 in this article, we will look at 1 what is a blue ocean strategy. Blue ocean strategy is a must read book for any business professional looking to open out newer ways of addressing a market. It opens up new possibilities that are not available to organizations operating within the existing cost value structure. This, the authors refer to as the cornerstone of the blue ocean strategy. Value innovation is a new way of thinking about and executing strategy that results in the creation of a blue ocean. The strategy canvas is both a diagnostic and an action framework for building a compelling blue ocean strategy. Before we dive into blue ocean strategy examples, lets get clear on what a.
Pdf blue ocean strategy download full pdf book download. This is done through detailed description of six reconstruction. Part 2 of the blue ocean strategy tackles the four formulation principles beginning with reconstructing market boundaries. May 30, 2017 t his month, we read blue ocean strategy by w. The strategy canvas is both the start and the end point of a blue ocean strategy formulation. How to create uncontested market space and make competition irrelevant has had a huge impact worldwide.
A new value curve eliminated reduce p be shift the strategic create which of the factors. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. After having dealt with the blue ocean metaphor as well as having clarified the concept of value innovation, the chapter moves on by describing the basic analytical tools and frameworks that characterize the blue ocean strategy. Chan kim and renee mauborgne have created a comprehensive set of analytic tools and frameworks to create blue oceans of new market space.
New market space cirque du soleil succeeded because it realized that to win. The blue ocean strategy is presumably based on the use of value innovations. May 31, 2016 in this book summary of blue ocean strategy, well outline the key concepts, tools and tips from the book to help you create uncontested market space and make your competition totally irrelevant. It is then transformed via the eliminatereduceraisecreate actions framework. Value innovation strategy competes in an uncontested market space.
Summary capter 1 4 of blue ocean strategy by lauri di vino. Red ocean strategy blue ocean strategy compete in existing marketing beat the competition. 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. This book is not the victory of an idea but of a friendship that we have found more. Feb 03, 2015 the premise on which the blue ocean strategy thesis is built, is a simple one. An initial value curve depicts where the industry competes on and invests in. How to create uncontested market space and make the competition irrelevant, w. Blue ocean strategy and new business models in the food. Oct 18, 2018 this implies that a blue ocean will eventually turn red with competition. They explain how monitoring the value curve enables a company to track. Click here to download the blue ocean strategy canvas template.
Although, in itself, it cannot identify new market spaces, it does provide a visualisation that might give a eureka moment when used as part of a strategic process. The eliminatereduceraisecreate errc grid developed by w. It is one of the most useful business books i have read in recent times. How to create uncontested market space and make the competition irrelevant kindle edition by kim, w. Apr 03, 2010 value innovation the cornerstone of bos value innovation places equal emphasis on value and innovation. How to create uncontested market space and make the competition irrelevant by chan kim and renee mauborgne. Now, 12 years later, the authors offer an exciting new book that synthesizes their experience in assisting with the implementation of blue ocean strategy. In this article you will learn how to make your competition irrelevant and have sales and profit. It shows how a new blue ocean strategy creates a unique value curve, focusing on values critical to customers at the expense of lessimportant factors. The strategy canvas is a central diagnostic tool and an action framework of blue. The strategy canvas gets you to focus on bigpicture strategic items, rather than getting mired in numbers, spreadsheets, and incremental improvements. 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 challenges companies to break out of the red ocean of bloody competition by creating uncontested market space that makes the competition irrelevant. While the book is aimed primarily at large, traditional businesses, our book club members managed to scale some of the advice to fit our needs. Blue ocean strategy is the same as differentiation strategy. Most prominently, since 2009 the malaysian government has implemented a national blue ocean strategy to lift the living standard of the country and to. Blue ocean strategy chapter 14 the four action framework chapter two.
Blue ocean strategy including examples and pdf download. Chan kim and renee mauborgne published their book titled the blue ocean strategy. 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. Blue ocean strategy formulation the strategy canvas. Jun 19, 2014 one of the techniques used in the book is the strategy canvas. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. How to create blue oceans using value curves arif harbott. Blue ocean strategy is a powerful framework for finding new business opportunities. The premise on which the blue ocean strategy thesis is built, is a simple one. It is drawn by plotting the companies offering relative to other alternatives based on key success factors in the industry. In contrast, blue ocean strategy seeks to break the valuecost tradeoff by eliminating and reducing factors an industry. Drawing on more than a decade of new work, kim and mauborgne show you how to move beyond competing, inspire. Traditionally, differentiation is defined as providing premium value at higher cost to the company and higher prices to the customer think mercedesbenz.
Summary capter 1 4 of blue ocean strategy by lauri di. May 24, 2011 if you are going to create a blue ocean from within a red ocean the key tool to use is a value curve. The value curve model visualises products comparisons which, in an increasingly competitive environment, helps product managers face the challenge of finding ways to differentiate their products click to tweet value curve case study. What is the blue ocean strategy the term blue ocean was coined by two professors w.
The objective of blue ocean strategy is to make competition irrelevant by creating a new value curve for both customers and the company itself. Free blue ocean strategy powerpoint templates now that youve done the hard work of identifying your blue ocean strategy, its time to present it to top management. Chan kim and renee mauborgne in their book titled blue ocean strategy. How to create uncontested market space and the make. Part 2 of the blue ocean strategy tackles the four formulation principles beginning with. Chan kim and renee mauborgne is a simple matrix like tool that drives companies to focus simultaneously on eliminating and reducing, as well as raising and creating while unlocking a new blue ocean. Create a new market space through innovating on the value you give to the customer. The blue ocean strategy argues that consumers dont have to choose between value and affordability. Chan kim and renee mauborgne, develops and explains how to beat the competition by reaching beyond it into new unexplored markets.
Find all the books, read about the author, and more. 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. Blue ocean strategy can be applied across sectors or businesses. But, lets first understand what is blue ocean and how it is different from red ocean strategy. How to create uncontested market space and make the competition irrelevant pdf by w. In this book summary of blue ocean strategy, well outline the key concepts, tools and tips from the book to help you create uncontested market space and make your competition totally irrelevant. It is a simple but very powerful visualisation methodology.