Blue ocean strategy
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Blue ocean strategy

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    Blue ocean strategy Blue ocean strategy Presentation Transcript

    • Blue Ocean Strategy 1
    • Contents1. Blue Ocean Vs. Red Ocean Strategy2. Blue Ocean Strategy Tools3. Strategy Canvas and Four Action Framework4. Six Principles of Blue Ocean Strategy5. Formulating Blue Ocean Strategy6. Executing Blue Ocean Strategy I 2
    • Blue Ocean Vs. Red Ocean Strategy 3
    • Blue Ocean vs. Red Ocean Strategy Blue Ocean Strategy Red Ocean Strategy•• Create uncontested Create uncontested •• Compete in existing Compete in existing market space market space market space market space•• Make the competition Make the competition •• Beat the competition Beat the competition irrelevant irrelevant•• Create and capture Create and capture •• Exploit existing Exploit existing new demand new demand demand demand 4
    • Blue Ocean vs. Red Ocean Strategy Blue Ocean Strategy Red Ocean Strategy•• Break the value- cost Break the value- cost •• Make the value-cost Make the value-cost trade off trade off trade off trade off•• Align the whole system Align the whole system •• Align the whole system Align the whole system of a firm’s activities with of a firm’s activities with of a firm’s activities with of a firm’s activities with its strategic choice of its strategic choice of its strategic choice of its strategic choice of differentiation and low differentiation and low differentiation or low differentiation or low cost cost cost cost 5
    • Blue Ocean Strategy Tools • A diagnostic tool for building a Strategy compelling blue ocean strategy Canvas • It captures the current state of play in the known market space • Allow you to understand : • where the competition is currently investing • the factors the industry currently competes on in product, service and delivery • what customers receive from existing competitive offerings on the market 6
    • Four Action Framework Eliminate Raise Reduce Create 7
    • Four Action Framework Which of the factors that the industry Eliminate takes for granted should be eliminated? Which factors should be reduced well Reduce below the industry’s standard? Which factors should be raised well Raise above the industry’s standard? Which factors should be created that Create the industry has never offered? 8
    • Four Action FrameworkThe Case of Cirque du Soleil (A Circus Company) Eliminate Reduce• Star performers • Fun and humor• Animal shows • Thrill and danger• Aisle concession sales• Multiple show arenas Create Raise• Theme • Unique venue• Refined environment• Multiple productions• Artistic music and dance 9
    • Six Principles of Blue Ocean Strategy Formulation Principles Execution Principles1. Reconstruct market 5. Overcome key boundaries organizational2. Focus on the big picture, hurdles not the numbers 6. Build execution into3. Reach beyond existing strategy demand4. Get the strategic sequence right 10
    • 1. Reconstruct Market Boundaries Head-to-Head Strategy Blue Ocean Strategy•Focuses on maximizing the • Looks across to complementary product•Focuses on adapting to and service offerings • Participates in shaping external trends over time 11
    • 2. Focus on the Big Picture, not the Numbers • Compare your business with yourVisual competitors’ by drawing your “as is”Awakening strategy canvas • See where your strategy needs to change 12
    • 3. Reach Beyond Existing Demand • First tier: “Soon to be” non- customers who are the edge of your market, waiting to jump shipThe ThreeTier of Non- • Second tier: “Refusing” non-customers customers who consciously choose against your market • Third tier: “Unexplored” non- customers who are in markets distant from yours 13
    • ExecutingBlue Ocean Strategy 14
    • End of Material 15