Blue ocean strategy

SUMMARY

BLUE OCEAN STRATEGY
By W.Chan Kim and Renée Mauborgne

“Competing in overcrowded industries is no way to sustain high performance. The real opportunity is to create blue oceans of uncontested market space”

|The idea in brief |
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|The best way to drive profitable growth? Stop competing in overcrowded industries (red ocean). |
|Even-more intense competition turns the water bloody. |
|How t avoid the fray?? Kim andMauborgne recommend creating blue oceans – uncontested market spaces when the competition is |
|irrelevant. |
|In blue oceans you invent and capture new demand, and you offers customers a leap in value while also streamlining your cost. |
|Results? Hand some profits,speedy growth – and brand equity that lasts for decades while rivals scramble to catch up. |
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|The idea in practice |
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|Understand the logic behind blue ocean strategy |
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|The logic behindblue ocean strategy is counterintuitive: |
|It´s not about technology innovation: Blue ocean seldom result from technological innovation. Often, the underlying technology |
|already exist – and blue ocean creators link it to what buyers value. |
|You don´t haveto venture into distant waters to create blue oceans: Most blue ocean are created from within, not beyond, the red |
|oceans of existing industries. Incumbents often create blue ocean within their core businesses. |
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|Apply blueocean strategic moves |
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|To apply blue ocean strategic moves: |
|Neveruse the competition as a benchmark: Instead, make the competition irrelevant by creating a leap in value for both, yourself |
|and your customers. |
|Reduce your cost while also offering customers more value. |▪ Cirque du Soleil did not make its money by competing within the confines of the existing industry or by stealing customers from Ringling and the others. Instaead it created uncontested market space that make the competition irrelevant.
▪ It pulled in a whole new group of customers who were traditionally non-customers of the industry – adults and corporate clients who had turned to theater,...