What is Blue Ocean Strategy?

Great video describing Blue Ocean Strategy. This will help make strategic moves to create new value for the company by creating new demand.

Here is what artificial intelligence says about Blue Ocean Strategy:

Blue ocean strategy is a business strategy that involves creating a new market or industry, rather than competing in an existing market. The concept is based on the idea that businesses can create more value and achieve greater success by focusing on creating new market opportunities, rather than competing with existing players for a share of an existing market.

The term “blue ocean” is used to describe this new market space, in contrast to the “red ocean” of existing competition. The idea is that businesses can create blue oceans by identifying and targeting unmet customer needs, and by developing innovative products or services that meet these needs in ways that differentiate them from existing offerings.

Blue ocean strategy emphasizes the importance of value innovation, which involves creating value for both the company and customers, and of finding ways to break away from traditional industry conventions and boundaries. It is often used as a framework for developing new business strategies and for identifying opportunities for growth and differentiation.

What Is Blue Ocean Strategy?

Book Summary

Blue Ocean Strategy is a book by W. Chan Kim and Renée Mauborgne published in 2004. It proposes a new way of thinking about business strategy, one that is based on creating new markets rather than competing in existing ones.

The authors argue that traditional business strategy is focused on beating the competition. This leads to companies competing in a “red ocean” of bloody competition, where profits are low and growth is difficult.

Instead of competing in red oceans, the authors propose that companies create blue oceans. Blue oceans are uncontested market spaces where there is no competition and where there is a lot of potential for growth.

To create a blue ocean, companies need to focus on value innovation. Value innovation is the simultaneous pursuit of differentiation and low cost. It is about creating new value for customers while also reducing costs.

The authors provide a number of tools and frameworks for creating blue oceans. One of the most important tools is the Four Actions Framework. The Four Actions Framework helps companies to identify and eliminate the factors that are preventing them from creating value for customers and reducing costs.

Another important tool is the Strategy Canvas. The Strategy Canvas helps companies to visualize their current value proposition and to identify opportunities for value innovation.

The authors also provide a number of examples of companies that have successfully created blue oceans. These companies include Cirque du Soleil, Starbucks, and Netflix.

Blue Ocean Strategy is a powerful book that can help companies to break free from the red ocean of competition and create new markets where they can grow and thrive.

Here is a more detailed summary of the key concepts in Blue Ocean Strategy:

Red oceans vs. blue oceans: Red oceans are existing markets where there is a lot of competition. Blue oceans are uncontested market spaces where there is no competition.
Value innovation: Value innovation is the simultaneous pursuit of differentiation and low cost. It is about creating new value for customers while also reducing costs.
The Four Actions Framework: The Four Actions Framework helps companies to identify and eliminate the factors that are preventing them from creating value for customers and reducing costs.
The Strategy Canvas: The Strategy Canvas helps companies to visualize their current value proposition and to identify opportunities for value innovation.

Blue Ocean Strategy has been a bestseller since its publication, and it has been translated into over 30 languages. It is a widely taught book in business schools, and it is used by companies of all sizes to develop their business strategies.

Here are some of the benefits of using Blue Ocean Strategy:

Increased profits: Blue oceans are typically more profitable than red oceans because there is less competition.
Faster growth: Blue oceans offer the potential for faster growth because they are uncontested market spaces.
Greater differentiation: Blue oceans allow companies to differentiate themselves from their competitors and to create a unique value proposition for customers.
Sustainable competitive advantage: Blue oceans are more sustainable than red oceans because they are based on value innovation.

Blue Ocean Strategy is a powerful tool that can help companies to break free from the red ocean of competition and create new markets where they can grow and thrive.

Strategy Quotes

“Execution is the ability to mesh strategy with reality, align people with goals, and achieve the promised results.” ~Larry Bossidy
“There is only one winning strategy. It is to carefully define the target market and direct a superior offering to that target market.” ~Philip Kotler
“The natural strategic orientation of many companies is toward retaining existing customers and seeking further segmentation opportunities. This is especially true in the face of competitive pressure. Although this might be a good way to gain a focused competitive advantage and increase share of the existing market space, it is not likely to produce a blue ocean that expands the market and creates new demand.” ~ W. Chan Kim, Blue Ocean Strategy
“A vision and strategy aren’t enough. The long-term key to success is execution. Each day. Every day.” ~Richard M. Kovacevich
“Strategy is about setting yourself apart from the competition. It’s not a matter of being better at what you do – it’s a matter of being different at what you do.” ~Michael Porter
“You cannot be everything to everyone. If you decide to go north, you cannot go south at the same time.” ~Jeroen De Flander
“Success is 20% skills and 80% strategy. You might know how to succeed, but more importantly, what’s your plan to succeed?” ~Jim Rohn