Blue ocean strategy

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Presentation prepared by Nitish Raj of IIPM, New Delhi under the mentorship of Prof. Lauren Mathys of INSEAD

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Blue ocean strategy

  1. 1. Blue Ocean StrategyPrepared By : Nitish RajIIPM ; New DelhiMentor : Lauren Mathys ; Ph.D.INSEADFounder Of Blue Crest Consulting(Switzerland)Vice President : Merck Soreno International
  2. 2. Overview• 7,50,000 species are yet to be discovered in the world.• As there is strategy, so there is industry• Not that there is strategy, so there is industry• Productivity is not all explained by capital and labour.• Innovation and technological change comes from the “Unternehmergeist”.
  3. 3. Innovation• Process which leads an invention from the idea to the market place – Joseph Schumpeter• Innovation an alliance between research, marketing, instinct, imagination, p roducts and industrial courage• Value Innovation is the cornerstone of Blue Ocean Strategy
  4. 4. Innovation In Terms Of Blue Ocean Strategy• Innovation when defined in terms of value to the customers is: Value = Utility- Price This is sometimes also called value innovation.
  5. 5. Components Of Blue Ocean Strategy Eliminate Raise Reduce Create
  6. 6. Formulation Principles Of Blue Ocean Strategy Reconstruct Focus Reach Beyond Strategic Sequence Right Overcome Hurdles Build Execution In Strategy
  7. 7. Strategic Sequence Unprecedented Strategic Price Value More Target Cost Environment Friendly
  8. 8. Formulation Process Of Blue Ocean Strategy Visual Awakening Visual Exploration Visual Strategy Fair Visual Communications
  9. 9. Principles Of Blue Ocean Strategy Be Decisive Have a Be clear Irreversible trajectory
  10. 10. Types Of Customers Actual Customers Actively Refused Quickly Moved
  11. 11. Ways To Change Customer Experience Of Utilizing A Product Helping a customer to do things faster or better Contribute to No physical or improve the intellectual environment difficulty Creating a Easy to obtain or particular image use or dispose of for the customer Reduce financial pressure
  12. 12. Secret Of Increasing The Customers• Lower the cost to the minimum level• Increase the value to the customer Cost Buyer Value To Customer
  13. 13. Six Path Framework For Choosing Industries Using Blue Ocean Strategy When Applying Innovative Idea• Alternative Industries (SouthWest Airlines)• Strategic Group Industry(French Budget Hotel)• Chain Of Buyers Industries(Nove Nordisk Company)• Complementary Services/Products Industry(North American Bus Industries)• Functional – Emotional Appeal Industries(The Body Shop)• Time/Trends Industries(Kimberly-Clark )
  14. 14. Hurdles Of Blue Ocean Strategy Cognitive Resource Motivational Political
  15. 15. Implementation Of BOS• Value Innovation• Tipping Point Leadership(To overcome the 4 hurdles mentioned in previous slide)• Fair Process
  16. 16. Fair Process The three E principles of Fair process are:(a) Engagement(b) Explanation(c) Expectation Clarity
  17. 17. Choosing The Right Approach To BOSHigh Blue Red RedResources Blue Depends On BlueAnd StrategicCapabilities MindsetLow Unattractive Little Attractive Attractive
  18. 18. How To Determine It Is A BOSOther Strategy Blue Ocean StrategyStructuralist ReconstructionistCompeting CreatingFocus On Existing Customer Focus On Non- CustomerPremium/ Low Pricing StrategicCost+ Pricing TargetValue Improvement Align people, profit, value proposition
  19. 19. ThankYou

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