Katharina bostc

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blue ocean strategy

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Katharina bostc

  1. 1. Blue Ocean Strategy How to create uncontested market space and make the competition irrelevantKatharina BOST 12/06/2006
  2. 2. About the Founders: Chan & ReneeW. Chan Kim• The Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International ManagementRenée Mauborgne• The INSEAD Distinguished Fellow and Professor of Strategy and International Management
  3. 3. Two worlds …
  4. 4. Two worlds …Red Ocean Strategy Blue Ocean StrategyCompete in existing market Create uncontested marketspace. space.Beat the competition. Make the competition irrelevant.Exploit existing demand. Create and capture new demand.Make the value-cost trade-off. Break the value-cost trade-off.Align the whole system of a Align the whole system of astrategic firms activities with firms activities in pursuit ofits choice of differentiation or differentiation and low cost.low cost. VALUE INNOVATION
  5. 5. The rising Imperative of Creating Blue Oceans• supply exceeds demand• globalization• accelerated commoditization of products and services• increasing price wars• shrinking profit margins• brands are becoming more similar select based on price• ...
  6. 6. BOS Logic: The Core PrinciplesReconstruct MarketBoundaries… overcome believes.Reach beyondexisting Demand… go for uncontested space. COST VI VIGet the strategicsequence right VALUE… value [innovation] first.
  7. 7. BOS Logic: Reconstruct market boundaries Boundaries of Head-to-Head Creating Competition Competition New Market Space Looks across alternative Focuses on rivals within its Industry industries industry Looks across strategic groups Focuses on competitive position Strategic Group within its industry within strategic group Focuses on better serving the Redefines the buyer group of the Buyer Group industry buyer group Looks across to complementary Scope of Product Focuses on maximizing the value product and service offerings that and Service of product and service offerings go beyond the bounds of its Offerings within the bounds of its industry industry Focuses on improving price- Rethinks the functional-emotionalFunctional-emotional orientation of its industry performance with the functional- Orientation of an emotional orientation of this Industry industry Participation in shaping external Focuses on adapting to external Time/Trends trends over time trends as they occur
  8. 8. BOS Logic: The Core Principles Reconstruct Market Boundaries … overcome believes.Reach beyondexisting Demand… go for uncontested space. COST VI VI Get the strategic sequence right VALUE … value [innovation] first.
  9. 9. BOS Logic: Reach beyond existing demand Core Customer Noncostumer Soon-to-be-NC Refusing Customer
  10. 10. BOS Logic: The Core PrinciplesReconstruct MarketBoundaries… overcome believes.Reach beyondexisting Demand… go for uncontested space. COST VI VIGet the strategicsequence right VALUE… value [innovation] first.
  11. 11. BOS Logic: Get the Strategic Sequence right Buyer utility Is there exceptional buyer utility in your business idea? No  Rethink YES Price Is your price easily accessible to the mass of buyers? No  Rethink YES Cost Can you attain your cost target to profit at your strategic price? No  Rethink YES Adoption What are the adoption hurdles in actualizing your business idea? Are you addressing them up No  Rethink front? YESA commercially viable Blue Ocean Strategy
  12. 12. The case of Accors Formule 1The value curve of Formule 1 in the French Low Budget Hotel Industry
  13. 13. References• W. Chan Kim, Renée Mauborgne, Blue Ocean Strategy, 2005, Havard Business School Press.• http://www.blueoceanstrategy.com• HANDELSBLATT, Donnerstag, 06. Oktober 2005, Mit Nichtkunden neue Märkte finden.• http://www.hotelformule1.com
  14. 14. Thank you for yourattention!!!

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