Blue Ocean & Business Model Innovation

Create uncontested market space Make competition irrelevant Blue Ocean as a means for Business Model Innovation

From Red Ocean Strategy to Blue Ocean Strategy… Blue Ocean Red Ocean
Create uncontested market place
Make the competition irrelevant
Create and capture new demand
Break the value/cost trade-off
Align the whole system of a company‘s activities in pursuit of differentiation and lower cost
Compete in existing market place
Beat the competition
Exploit existing demand
Make the value/cost trade-off
Align the whole system of a company‘s activities its strategic choice of differentiation or lower cost
Blue Ocean Basics Differences between Red Ocean and Blue Ocean

The Six Principles of Blue Ocean Strategy A Blue Ocean is formulated and evaluated based on six principles which aim at reducing the risk concerned with each principle. Risks mitigated Reconstruct market boundaries Focus on the big picture, not the numbers Reach beyond existing demand Get the strategic sequence right Blue Ocean Basics Formulation Principles Evaluation Principles Overcome key organizational hurdles Build execution into strategy Search risk Planning risk Scale risk Business Model risk Organizational risk Management risk The 6 Principles

Formulating a Blue Ocean is done based on the methodology How to reshape your markets and propositions so that you become the to-beat company? Reconstruct market boundaries Focus on the big picture, not the numbers Get the strategic sequence right 6 paths: Visual Awakening Visual Exploration Visual Strategy Fair Reach beyond existing demand
Look Across Alternative Industries
Look Across Strategic Groups Within Industries
Look Across the Chain of Buyers
Look Across Complementary Product and Service Offerings
Look Across Functional or Emotional Appeal to Buyers
Look Across Time
Blue Ocean Formulation Visual Communication Buyer utility Price Cost Adoption √ √ √ √ The Methodology

Formulating a Blue Ocean is done based on the methodology How to execute your Blue Ocean Strategy? Overcome key organizational hurdles Cognitive Motivational Political Build execution into strategy Blue Ocean Evaluation Resource Strategy formulation process Attitudes Behavior Strategy execution The Methodology

A Generic Business Model overview ECO System Value Configuration SUCCESS Distribution Channel Cost Structure Revenue Streams Customer Offer Finance Adapted from Alexander Osterwalder, The Business Model Ontology, a proposition in a design science approach Customer Relationship Value Proposition Customer Segment Core Capabilities Partner Network

Let’s start creating your Blue Ocean

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Blue Ocean & Business Model Innovation

by Bas van Oosterhout on Jan 20, 2008

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Blue Ocean & Business Model Innovation — Presentation Transcript