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Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
Blue ocean strategy
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Blue ocean strategy

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Course of Blue Ocean Strategy …

Course of Blue Ocean Strategy
University College Cork
Visiting professor: François Cazals (ISC Paris School of Management)

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  • 1. Academic JourneyE-Business MBA Program – ISC Paris University College Cork Course of Blue Ocean Strategy February 21st , 2012 Professor François Cazals 2
  • 2. Agenda ISC Paris School of Management The Professor Competition-based strategy A little film Blue Ocean Strategy 3
  • 3. ISC Paris group  1800 students « grande école »  250 students MBA’sBusiness Executive MBA School Education 4
  • 4. François Cazals  CEO Distriforce  ISC Paris  Affiliate Professor  Head  ISC Executive Education  E-Business MBA Program  Speaker  HEC Paris Executive fcazals@iscparis.com Education Twitter: @distriforce  ESSEC Paris Executive Blog: cazals.fr Education 5
  • 5. Blue OceanStrategyCreatingnew marketspace
  • 6. Competition-basedstrategy
  • 7. Subtle War Brutal War Blue Red “To subdue the enemy “ War is an act of violencewithout fighting is the acme intended to compel our of skill”. opponent to fulfill our will”.Sun Tzu (544-496 BC J.-C.) Clausewitz (1780-1831) 8
  • 8. A founding principle“Competition is at the coreof the success or failure offirms”.1st sentence of Michael Porter’smost important book 9 Michael PORTER
  • 9. Two generic strategies Low Cost DifferentiationParis-DublinRyanair 55 €Air France 286 € 10
  • 10. A little film http://distriforce.net/insead.wmv 11
  • 11. The Book and the Authors Prof Chan Kim Prof Renée Mauborgne 12
  • 12. 10 Strategy Canvas98 The value curve, the basic component of the strategy7 canvas, is a graphic6 depiction of a company’s relative performance across5 its industries factors of4 competition.3210 Comp Fact 1 Comp Fact 2 Comp Fact 3 Comp Fact 4 Comp Fact 5 Comp Fact 6 Comp Fact 7 Comp Fact 8 Firm Competitor 13
  • 13. Strategic corridor10 9 8 7 6 5 Corridor 4 3 2 1 0 Var 1 Var 2 Var 3 Var 4 Var 5 Var 6 Var 7 Var 8 Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Comp 6 14
  • 14. Industry CycleStart Growth Maturity Decline Loyalty One to One Innovation Low Cost 15
  • 15. Red Ocean Vs. Blue Ocean Compete in existing market  Create uncontested market space space Beat the competition  Make the competition Exploit existing demand irrelevant Make the value-cost trade-  Create and capture new off demand Align the whole system of a  Break the value-cost trade- firm’s activities with its off strategic choice of  Align the whole system of a differentiation or low cost firm’s activities in pursuit of differentiation and low cost
  • 16. 4 actions framework Reduce Create a newEliminate value Create curve Raise 17
  • 17. Raise What factors should be raised well beyond the industry standard? Eliminate Create What factors What factors should should be be created that theeliminated that the industry has neverindustry has taken offered? for granted? Reduce What factors should be reduced well below the industry standard?
  • 18. 6 Paths Framework Head-to-head competition Blue Ocean Creation Focuses on rivals within its Looks across alternativeIndustry industry industries Focuses on competitive Looks across strategicStrategic Group position within strategic groups within industry group Focuses on better serving Redefines the industryBuyer Group the buyer group buyer group Focuses on maximizing the Looks across toScope of product or value of product and service complementary productservice offering offerings within the bounds and service offerings of its industry Focuses on improving price Rethinks the functional-Functional-Emotional performance within the emotional orientation of itsorientation functional-emotional industry orientation of its industry Focuses on adapting to Participates in shapingTime external trends as they external trends over time occur 19
  • 19. Look across alternative industriesRent a apartment + Go to the hotel= Corporate Apartements = apart-hotel concept 20
  • 20. Look across strategic groups withinindustry + = 21
  • 21. Redefine the industry buyer group 22
  • 22. Look across to complementary product andservice offerings
  • 23. Rethink the functional-emotional orientation of its industryFunctional Emotional Fonctionnel 24
  • 24. Participate in shaping externaltrends over time 3D TV Ultra Flat TV Connected TV 25
  • 25. Blue ocean? 26
  • 26. 3 Tiers of Non-customers 27
  • 27. TheGamers• Men• Under 35• Sports, Fig hts, Cars,…
  • 28. 3 Tiers of Non-customers « Soon-to-be » non- customersMen aged over 35 « Refusing » non- costumersOld people, parents, women « Unexplored » non- customersFamilies 29
  • 29. Business CaseHow Apple has created a newmarket space with the iPad
  • 30. 3 examplesSony Vaio VPC-SB3L9E SAMSUNG Netbook iPad 2 64Go Wi-Fi W 13,3" LED USB 3.0 N145Plus 31
  • 31. Red OceanVariables Sony SamsungPrice 899 € 239 €Weight 1,720 kg 1,240 kgScreen 13,3 inches 10,1 inchesHard Drive 500 Go 250 GoConnectivity 10/10 7/10Keyboard Yes YesDesign 7/10 5/10Market Laptops Netbooks 32
  • 32. Strategy canvas Differentiation Low Cost Price Weight Screen Hard Drive Connectivity Keyboard Design 33
  • 33. Blue oceanVariables iPadPrice 489 €Weight 0,613 kgScreen 9,7 inchesHard Drive 64 GoConnectivity 3/10Keyboard NoDesign 9/10Touch NewinterfaceiCloud NewAppStore NewMarket Touch Pads 34
  • 34. Blue Ocean vs. Laptops E R R C 35
  • 35. Blue Ocean vs. Laptops Three Tests of a Blue Ocean Strategy: E 1) R Focussed R C 2) Divergent 3) Compelling Tagline 36
  • 36. Blue ocean vs. Netbooks E R R C 37
  • 37. “If you dream it, you can do it”. Walt Disney 38
  • 38. Annex
  • 39. Exercise• 1. List Factors of Competition• 2. Top 2 or 3 in ERRC Grid Quadrants• Clearly define the group of “non- customer” that you are going after.
  • 40. Examples
  • 41. Exercise3. Write on Worksheet: E left, C right4. Draw “As Is”5. Draw “To Be”
  • 42. Examples
  • 43. ExerciseDemonstratethat iphone is ablue oceanstrategycompared toblackberry (atthe beginning)

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