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Blue Ocean StrategyProf ReneeMauborgne© JOHN ABBOTTProf Chan Kim© JOHN ABBOTTThe Book and the Authors
Creating New Market SpaceTo win in the future New MarketSpace, companies must stopcompeting with each other.Because the on...
Two OceansRED OCEANBLUE OCEAN
Two Oceans …Red Ocean Strategy Blue Ocean StrategyCompete in existingmarket space.Create uncontested marketspace.Beat the ...
BOS Logic: The Core PrinciplesReconstruct MarketBoundaries… overcome believes.Reach beyondexisting Demand… go for uncontes...
BOS Logic: Reconstruct market boundariesIndustryFocuses on rivals within itsindustryStrategic GroupFocuses on competitive ...
BOS Logic: Reach beyond existing demandCore Customer NoncostumerSoon-to-be-NC Refusing Customer
BOS Logic: Get the Strategic Sequence rightBuyer utilityIs there exceptional buyerutility in your business idea?AdoptionWh...
Which Strategy?Compete in existing marketspaceBeat the competitionExploit existing demandMake the value/cost trade-offAlig...
What factorsshould beeliminated that theindustry has takenfor granted?EliminateWhat factorsshould be reducedwell below the...
FIRST STEP• Sit with your group members & establish yourcompany.• Reappoint your members to hold variouspositions (please ...
Sailing The Blue OceanThe Task:Using the materials provided and not more than3 materials from your surroundings, use your...
BLUE OCEAN PARTS MATERIALSNO GIVEN PARTS QUANTITY1 STRAWS 10 PIECES2 STRING 1 STRAND3 PAPER 4 PIECES4 UNKNOWN OBJECT 1 PIE...
Company’s ListNO. POSITION NAME NICKNAME SIGNATURE1.2.3.4.5.6.7.CEOCFOCOOCMOCTOCROCIOCOMPANY NAME: DATE:
BLUE OCEAN PRODUCTPRODUCT NAMEPRODUCTDESCRIPTIONPRODUCT FEATUREPRODUCT MARKETPROMOTION TAGLINEPRODUCT PRICESELLING PRICEPR...
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Blue Ocean

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Blue Ocean

  1. 1. Blue Ocean StrategyProf ReneeMauborgne© JOHN ABBOTTProf Chan Kim© JOHN ABBOTTThe Book and the Authors
  2. 2. Creating New Market SpaceTo win in the future New MarketSpace, companies must stopcompeting with each other.Because the only way to beat thecompetition is to stop trying to beatthe competition.
  3. 3. Two OceansRED OCEANBLUE OCEAN
  4. 4. Two Oceans …Red Ocean Strategy Blue Ocean StrategyCompete in existingmarket space.Create uncontested marketspace.Beat the competition. Make the competition irrelevant.Exploit existing demand. Create and capture newdemand.Make the value-cost trade-off.Break the value-cost trade-off.Align the whole system ofa strategic firms activitieswith its choice ofdifferentiation or low cost.Align the whole system of afirms activities in pursuit ofdifferentiation and low cost.VALUE INNOVATIONFrom Kim & Mauborgne, 2005
  5. 5. BOS Logic: The Core PrinciplesReconstruct MarketBoundaries… overcome believes.Reach beyondexisting Demand… go for uncontested space.Get the strategicsequence right… value [innovation] first.VIVICOSTVALUE
  6. 6. BOS Logic: Reconstruct market boundariesIndustryFocuses on rivals within itsindustryStrategic GroupFocuses on competitive positionwithin strategic groupBuyer GroupFocuses on better serving thebuyer groupScope of Productand ServiceOfferingsFocuses on maximizing the valueof product and service offeringswithin the bounds of its industryFunctional-emotionalOrientation of anIndustryFocuses on improving price-performance with the functional-emotional orientation of thisindustryTime/TrendsFocuses on adapting to externaltrends as they occurLooks across alternativeindustriesLooks across strategic groupswithin its industryRedefines the buyer group of theindustryLooks across to complementaryproduct and service offerings thatgo beyond the bounds of itsindustryRethinks the functional-emotionalorientation of its industryParticipation in shaping externaltrends over timeBoundaries ofCompetitionHead-to-HeadCompetitionCreatingNew Market Space
  7. 7. BOS Logic: Reach beyond existing demandCore Customer NoncostumerSoon-to-be-NC Refusing Customer
  8. 8. BOS Logic: Get the Strategic Sequence rightBuyer utilityIs there exceptional buyerutility in your business idea?AdoptionWhat are the adoption hurdles inactualizing your business idea?Are you addressing them upfront?PriceIs your price easily accessible tothe mass of buyers?CostCan you attain your cost target toprofit at your strategic price?A commercially viable Blue Ocean StrategyYESYESYESYESNo  RethinkNo  RethinkNo  RethinkNo  Rethink
  9. 9. Which Strategy?Compete in existing marketspaceBeat the competitionExploit existing demandMake the value/cost trade-offAlign the whole system of anorganization’s activities with itsstrategic choice ofdifferentiation OR low costSUSTAINING(RED)DISRUPTIVE(BLUE)VS.Create uncontested market spaceMake the competition irrelevantCreate and capture new demandBreak the value/cost trade-offAlign the whole system of anorganization’s activities in pursuitof differentiation AND low cost.From Kim & Mauborgne, 2005
  10. 10. What factorsshould beeliminated that theindustry has takenfor granted?EliminateWhat factorsshould be reducedwell below theindustry standard?ReduceWhat factors shouldbe created that theindustry has neveroffered?CreateWhat factorsshould be raisedwell beyond theindustry standard?RaiseFourActions tocreate aBlue Ocean From Kim & Mauborgne, 2005
  11. 11. FIRST STEP• Sit with your group members & establish yourcompany.• Reappoint your members to hold variouspositions (please ensure each member has adifferent role from previous assignments).– CEO/MD– COO– CRO– CFO– CMO– CTO– CIO• Fill in the company’s list form
  12. 12. Sailing The Blue OceanThe Task:Using the materials provided and not more than3 materials from your surroundings, use yourcreativity to design a creative product using theBlue Ocean Strategy.Determine a price for your product.Display your products with a poster with aproduct name, description, features, promotiontag line and the selling price.Market & sell your product to the BUYER/Class.Record your performance/Customers Reaction.
  13. 13. BLUE OCEAN PARTS MATERIALSNO GIVEN PARTS QUANTITY1 STRAWS 10 PIECES2 STRING 1 STRAND3 PAPER 4 PIECES4 UNKNOWN OBJECT 1 PIECENO FOUND PARTS QUANTITY12345COMPANY NAME: DATE:
  14. 14. Company’s ListNO. POSITION NAME NICKNAME SIGNATURE1.2.3.4.5.6.7.CEOCFOCOOCMOCTOCROCIOCOMPANY NAME: DATE:
  15. 15. BLUE OCEAN PRODUCTPRODUCT NAMEPRODUCTDESCRIPTIONPRODUCT FEATUREPRODUCT MARKETPROMOTION TAGLINEPRODUCT PRICESELLING PRICEPROFITCOMPANY NAME: DATE:

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