The insead blue ocean strategy institute focuses on the following research streams. What are some successful examples of blue ocean strategy. A landmark work that upends traditional thinking about strategy, this bestselling business book charts a bold new path to winning the future. Business strategy i 7 strategy principles every leader. The field of marketing has placed great emphasis on using everfiner market segmentation to. Mar 19, 2015 and then we saw companies putting the money behind this red ocean trap idea. Consider some of the well known blue oceans created by the new york police department, southwest airlines, cirque du soleil, casella wine yellowtail, nintendo wii, cemex cement, and the body shop. But they would go in it to apply blue ocean strategy or any idea and they were talking to the same customers. Companies pursue blue ocean strategies to make competition irrelevant. Cell phones, and particularly smart phones manufacturers, are in red oceans.
The greatest example of a red ocean industry would be applications offered from apple, inc. With over 4 million copies sold, it is one of the most popular strategy texts today. May 30, 2017 t his month, we read blue ocean strategy by w. The book includes many illuminating examples of blue ocean strategy in action, including. Renee mauborgnes advice will help your business stand out. The first part presents key concepts of blue ocean strategy, including value innovation the simultaneous pursuit of differentiation and low cost and key analytical tools and frameworks. By using our website you agree to our use of cookies. Careers are likely to change based on change in personal interests and the labour market demands.
These efforts to appeal to broad markets can be contrasted with strategies that involve targeting a relatively narrow niche of potential customers. Many readers may be familiar with the 2005 global bestselling book blue ocean strategy by professors renee mauborgne and w. Search the worlds most comprehensive index of fulltext books. 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.
Blue ocean strategy for creative businesses david parrish. Rouse him, and learn the principle of his activity or inactivity. Blue ocean strategy is a collection of wisdom, systematic process and framework which were formulated after extensive management research and studies of companies that exhibit characteristics of certain management principles that help these compa. Blue ocean strategy is a book published in 2005 and written by w. The fundamental premise is that most companies fight competitors headtohead in the same space, chasing the same customers with very similar products, creating a bloody red ocean in their feeding frenzy. Apple and samsung together dominate the smart phone market today. This often requires overcoming an intense level of competition and can often involve the commoditization of the industry where companies are competing mainly on price. A red ocean strategy ultimately leads to an organization choosing to follow one of two strategies differentiation or low cost.
I love the concept of not asking what your current clients want but instead asking people why they are clients. The intensity of competition in a market can be low, moderate, or high. In the book, they introduced the concepts of red and. Learn more about red and blue ocean strategies from the authors of the book on their website. Treating marketcreating strategies as niche strategies. 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. 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 based on over decadelong study of more than 150 strategic moves spanning more than 30 industries over 100 years. Which of the following conditions are not characteristic of markets with highly intense competition. Serious marketers should read the equivalent of 10 or more educational and industry. The book includes several excellent examples of companies that used the. 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.
Chan kim and renee mauborgne focused on discovering the common factors that lead to the creation of blue oceans and the key differences that separate those winners from the mere survivors and those adrift in the red ocean. Strategy award for best business book of the decade. A global bestseller and one of the best business strategy books available, blue. Some examples of companies that may have created new market spaces in the opinion of kim and mauborgne include.
This new market space is created by launching new offerings, with the aim being to make the competition irrelevant so that an organization can grow, uncontested, at least in the beginning. Here are a few examples of blue ocean strategic moves from a variety of different industries and sectors. In the decade since the publication of the first edition of our book, blue ocean strategy, weve had. Red ocean strategies compete in existing markets which is referred to head. Even though, recently, white ocean has emerged in world business strategy. Focused cost leadership and focused differentiation. A red ocean strategy involves competing in industries that are. Its a fantastic device for conceptualizing the red oceans of todays competition. Reading one of the best marketing books listed below is likely to change and improve the way you market. If youve been following dans work for some time, you know that he is a fan of not competing, but dominating your competition. But they would go in it to apply blue ocean strategy or.
One of the first books to make a splash in the disruptive marketing space has to be blue ocean strategy. A blue ocean strategy differs from a lowcost strategy in that. Often, companies believe that a great idea is enough to generate a commercial success. Aug 08, 2019 the first part presents key concepts of blue ocean strategy, including value innovation the simultaneous pursuit of differentiation and low cost and key analytical tools and frameworks. Blue ocean strategy is where a company creates a completely new market space or market category. The chart above summarizes the distinct characteristics of competing in red oceans red ocean strategy versus creating a blue ocean blue ocean strategy. The greatest example of a red ocean industry would be. Red ocean strategies have the following common characteristics. Blue ocean strategy is a theory explained in a 2005 book by w.
I would highly recommend this book for those with business backgound either their own, or have been working for the past 5 years or so. Companies should instead look for new market space and ways to reinvent the industry. 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. Based on a study of 150 strategic moves spanning more than 100 years. Companies that use a cost leadership strategy and those that use a differentiation strategy share one important characteristic. Nov 19, 2012 blue ocean strategy suggests that an organization should create new demand in an uncontested market space, or a blue ocean, rather than compete headtohead with other suppliers in an existing industry that is called red ocean. Red oceans are all the industries in existence today the known market space. This is what the authors of blue ocean strategy call a strategy canvas. I just finished blue ocean strategy and will soon start blue ocean shift. For those who want to create entirely new demand, beyond the known market space, the perspective in blue ocean strategy will steer you there. Mauborgne by instaread is an in depth analysis of a book that focuses on how to create new value for consumers rather than focusing on the competition, in an age when consumers, not companies. Jan 23, 2017 many readers may be familiar with the 2005 global bestselling book blue ocean strategy by professors renee mauborgne and w.
This blog article is a overview of some of the key points of the book by w. Chan kim and renee mauborgne, professors at insead. 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. But its not always clear how to create a blue ocean strategy for yourself. Blue ocean vs red ocean strategies 6 major differences. Blue ocean strategy is a powerful framework for finding new business opportunities. It seems that most all of the fortune companies play in red oceans. 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. Which of the following provides an example of a firm in a red ocean. Blue ocean shift is the essential followup to blue ocean strategy, the classic and. Chan kim and renee mauborgne, the writers of the 2005 book blue ocean strategy. Their iconic and impactful books, blue ocean strategy and blue ocean shift, provide a systematic approach to making the competition irrelevant and tools any organisation can use to shift from red oceans of bloody competition to blue oceans of new market.
There are two types of oceans in this world, according to authors w. Inside these marketing books, industry leaders reveal their secrets for improving brand position, building a rocksolid sales process, creating an epic content marketing strategy, and much more. For this strategy, the key goals are to beat the competition and exploit existing demand. A good example of red ocean strategy is the european airline operator ryanair or southwest if you like in the us. Some of these businesses are creating a whole new market. Blue ocean strategy is the complete opposite of the business strategy of direct competitioncalled red ocean strategyemployed by most companies, kim said. The research focused on discovering the common factors that lead to the creation of blue oceans and the key differences that separate those winners from the mere survivors and those adrift in the red ocean. Blue ocean strategy bos is the simultaneous pursuit of differentiation and lowcost to create new market space. Thus in the below figure the boxes in light red, suggest that according to business strategy matrix, the company should consider opting for a harvesting strategy or going for divesting the business. 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. While there are many classic marketing books that could make a bestbooks list, the recommended reading list below focuses only on marketing books published within the last 5 years.
Blue ocean strategy the blue ocean approach is a strategic tool that helps innovation strategists asses current and desired future strategic states whereasred ocean is a current state. Although jetblue used a blue ocean strategy to achieve an initial competitive advantage, it failed to maintain this advantage. Known as blue oceans within their framework, these uncharted waters are in contrast to red oceans, socalled for their bloodred, cutthroat competition. Whichever is chosen the organization must align all activities with one of these strategic directions. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. Blue ocean strategy is where a company creates a completely new market space or. Sep 24, 2017 blue ocean strategy requires a different mindset. And then we saw companies putting the money behind this red ocean trap idea. Six red ocean traps you should know blue ocean strategy. Every leader should at least master the basics so that they dont need a strategy consultant for every reflection process or at least to help them challenge the scenario models that the strategy consultant presents. Playing to win gets you the best of what our featured book would refer to as red ocean strategy.
What is blue ocean strategy about blue ocean strategy. A red ocean strategy involves competing in industries that are currently in existence. Sep 03, 2019 the blue and red ocean metaphor is a powerful one. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking away from the competition. If youd like to learn more about blue ocean strategies, then the best book on the subject is.
How to compete against fastmoving, innovative competitors. For example, competing factors in blue ocean strategy are similar to the definition of finite and infinite dimensions in funky business. To understand red ocean strategy let us begin by defining blue ocean strategy. Blue ocean strategy including examples and pdf download.
Which of the following aspects of businesslevel strategy has help yourself. Also getting out of our red ocean competition and getting into a whole new concept of something new. The vieoints of the authors are discussed with a greater clarity in order to clearify both the terms with respect to different references provided. Which of the following aspects of businesslevel strategy has help yourself accomplished. Blue ocean strategy presents a systematic approach to making the competition irrelevant and outlines principles and tools any company can use to create and capture their own blue oceans. This is where everyone would like to be and it is possible for you to have a blue ocean. The premise of the book is that companies can succeed by creating. Creating any kind of application whether it be a photo editing app, a game application like candy crush, or any of the various categorically odd applications you can find within the iphone app store would be extremely hard to even begin to compete against. The mental models that undermine marketcreating strategies. Creative, digital and cultural enterprises can radically improve their businesses using blue ocean strategy. In the following pages, well look at each trap in detail and see how it thwarts. Of course, great ideas must create a significant leap in buyer. Force him to reveal himself, so as to find out his vulnerable spots. Blue ocean shift is packed with realworld examples of organizations facing the same constraints we all face be they politics, bureaucracy, or limited resources that applied the very tools and process outlined in the book to shift from competi.
Student questions i need company who is in red ocean. From strategy to business models and to tactics ramon casadesusmasanell joan enric ricart november 2009 abstract the notion of business model has been used by strategy scholars to refer to the logic of the firm, the way it operates and how it creates value for its stakeholders. Recognized as one of the most iconic and impactful strategy books ever written, blue ocean strategy, now updated with fresh content from the authors, argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Chan kim and renee mauborgne in the indie business book club. Blue ocean idea boi index blue ocean idea boi index is a simple yet robust tool to verify if a new business idea meets the criteria of a blue ocean strategy. Of the many strategic planning models that exist, the blue ocean strategy could be considered the pacifist of the group. Learn about red ocean strategy and how it differs to blue ocean strategy. Like the blue ocean, it is vast, deep and powerful in terms of opportunity and profitable growth. It requires the right research, patience and focus. As established markets become less profitable, companies increasingly need to find ways to. Buy blue ocean strategy book online at best prices in india on. How to create uncontested market space and make the competition irrelevant, a book by professors w. Blue ocean strategy seeks to make the competition irrelevant by creating a leap in value for both the company and its buyers. The risks of following a blue ocean strategy the adaptive.
The company was working in a highly competitive marketplace, with many other businesses offering similar services. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Although help yourself has limited production facilities, it has increased the production of these books to meet this demand. Buy blue ocean strategy book online at low prices in india. This has been a bestseller since its initial publication more than 15 years ago and it continues to be the touchstone book when folks talk about the idea of turning industries and markets on their ear and how to do it. It hopes to get books to the market faster than its closest competitor, who is also increasing the production of winter gardening books. I got a lot of demands asking me for the best business strategy books. Just as blue ocean strategy claims that a red ocean strategy does not guarantee success, funky business explained that competitive strategy is the route to nowhere. Please someone tell me some specific companies products or services that are red ocean strategy. Some companies change a competitive game successfully, so that they help their competitors as well as themselves. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. For that there is nothing better than something called the blue ocean strategy.
The book presents analytical frameworks and tools to foster an organizations ability to systematically create and capture blue oceansunexplored new market. This is a red ocean strategy and it wont help deliver your new blue ocean strategy in a timely and. Chan kim and renee mauborgne are professors of strategy at insead and codirectors of the insead blue ocean strategy institute. Here, companies try to outperform their rivals to grab a greater share of existing demand. Therefore, holding on to the red ocean strategy to career management is likely to make one a spectator in the future labour. Red ocean companies believe that the structural constraints are given and that firms are forced to compete within them a structuralist view or environmental determinism. Avoid the competition in one of the best strategy books out there, blue ocean strategy, the authors explain the difference between a blue ocean and a red ocean. Is the blue ocean strategy book really a new approach or is. When i identify companies like these, i always suggest that they read blue ocean strategy to further develop their skills and vision. Their book teaches readers how to create uncontested markets for. Hence, this concludes the definition of harvesting strategy along with its overview. Advising a creative business in spain, i suggested that they adopt a blue ocean strategy. The best book for noncompetitive strategy striving.