The document summarizes key concepts from the book Blue Ocean Strategy. It discusses how blue ocean strategy involves creating uncontested market space by making competition irrelevant. It outlines how blue ocean logic differs from conventional logic by thinking freely from a company's existing assets and capabilities. The document also provides examples of value curves and strategy canvases that illustrate how blue ocean strategy works to create a new demand curve by eliminating, reducing, raising, and creating new factors.

2. Taxation in International
Business
Group No:1
Name of Members Roll No:
Akshay Samant 04
Harshita Deotare 19
Tejas Joshi 55
Vinay Jaiswal 57

3. Group No:1
Blue Ocean Strategy

4. The Book and the
Authors
© JOHN ABBOTT © JOHN ABBOTT
Prof Chan Kim Prof Renee
Mauborgne

5. Blue Ocean
Strategy
Go where the profits and growth are - and where the competition isn’t

6. Blue Ocean Strategy
Create uncontested market
space
Make the competition
irrelevant
Blue Ocean Create and capture new
demand
Porter contested
•It’s not Differentiation or
Low Cost
•It’s Differentiation and Low
Cost

7. Summary
Conventional Logic Blue Ocean Logic
Assets & Think in terms of a Think free from a company’s
Capabilities company’s existing assets existing assets and
and capabilities. capabilities.
Build on what it has. Ask, what if we start a new?
Product/ Think in terms of Think in terms of buyers’
Service products/services offered by solution even if that transcends
offerings the industry. Seek to the industry. Seek to solve
maximize the value of these buyers’ major bottlenecks/chief
offerings. compromises in using the
products/services of the
industry.

8. Value Innovation:
The Cornerstone of BOS
Costs
Value
Innovation
Buyer Value
The Simultaneous Pursuit of Differentiation and Low Cost

9. Value Innovation
 Region where a company’s actions favourably
affect both its cost structure and its value
proportion to buyers
 Cost savings by eliminating and reducing the
factors an industry competes on
 Buyer values is lifted by raising & creating
elements the industry has never offered
 Over time, costs are reduced further as scale
economies kick in

10. Blue Ocean Strategy
Red Ocean Blue Ocean

11. Reed Ocean Versus
Blue Ocean Stratégie
Red Ocean Strategy Blue Ocean Strategy
Compete in existing market space Create uncontested market space
Beat the competition Make the competition irrelevant
Differentiation or low cost Differentiation and low cost
Competitive Advantage Value Innovation
Segment existing customers Attract noncustomers
Exploit existing demand Create and capture new demand

12. Minimizing Risks and Maximizing
Opportunities in Formulating and
Executing Blue Ocean Strategy
Formulation Principles Formulation Risks
Reconstruct market boundaries Search Risk
Focus on the big picture, not the numbers Planning Risk
Reach beyond existing demand Scale Risk
Get the strategic sequence right Business Model Risk
Execution Principles Execution Risks
Overcome key organizational hurdles Organizational Risk
Build execution into strategy Management Risk

13. Strategy Canvas
US Wine Industry in the late 1990s
High
Budget Wines
Low
Price Above-the-line Vineyard prestige Wine
range
Use of enological marketing Aging Wine complexity
terminology and quality
distinctions in wine
communication

14. Four Actions Framework
REDUCE
Which factors
should be reduced well
below the
industry's standard?
ELIMINATE
Which of the factors that CREATE
the industry take for granted A New Which factors should be
should be eliminated? Value created that the industry
has never offered?
Curve
RAISE
Which factors should be
raised well above
the industry’s standard?

15. A New Value Curve –
Strategy Canvas
High
[Blue Ocean]
RAISE
CREATE
Low
Price
REDUCE
ELIMINATE

16. Strategy Canvas: Southwest Airlines
High
Southwest Airlines
Average Airlines
Car Transport
Low
Price Meals Lounges Seating Hub Friendly Speed Frequent
class choice connectivity Service Pint-to-
point
departure

17.  Eliminated: Many of the rules/criteria in the
industry
 Reduced: Focus on some of the rules below
industry standard
 Raised: Focus on some of the rules above
industry standard
 Created: A new rules of their own

18. Strategy Canvas: Hub Spot
14
12
Hub Spot
10
8
CRM Vendors
6
Hubspot
4
CRM
2 Vendors
0
Sales Features Price Add Ease of Familiar Help Unified Referral Hand Advice Service
team On's use UI Offering Force Holding Network
18

19.  Eliminate: The large sales force by putting the CMR
money which is the important activity.
 Creating: An innovative "referral force" which provides rich
incentives for our customers to refer us to other small
businesses as that is the way small businesses tend to
make decisions. Emphasis on "handholding" and "advice"
which is apart from traditional support and consulting.
 Raise: Increased emphasis ease of
use, help[Audio/video, Integration[Apps] increasing
emphasis on "handholding" and "advice" which is apart
from traditional support and consulting.
 Reduce: Emphasis relative to the industry on feature
richness/depth and on platform/add-ons (small companies
do not have resources to deal with the complexity of
multiple vendors products)

20. Use of Blue Ocean Strategy in India
Blue Ocean Strategy in India
Use of value curves--
Indian Angle

21. Case Study 3 :
Cricket Before IPL
High
Test Cricket
Low One Day
Spectator Classic Value of Team Emphasis on Entertainment Pacy Definite Athleticism
Time Technique Reputation Patience & Result
Perseverance

22. Case Study 3:
Cricket After IPL
High
Low Test Cricket One Day
20-20
Spectator Time Classic Value of Team Emphasis on Entertainment Pacy Definite Result Athleticism City Loyalty Open to
Technique Reputation Patience & Dummies
Perseverance

23. Case Study 3 :
Value Curve for IPL
 Reduce
 Spectator Time Invested (Competes with Movie/Football)
 Emphasis on Classic Techniques (Batting/Bowling)
 Emphasis on Patience, Perseverance
 Raise
 Emphasis on Athleticism
 Pace of the Game
 Entertainment with Bollywood, Cheerleaders etc.
 Certainty of Result
 Create
 City Loyalty
 Welcome to Dummies

24. Get the Strategic Sequence Right
Buyer Commercially
Price Cost Adoption Viable Blue
Utility Ocean Idea
What are adoption
Is there Is your price Can you attain hurdles in
exceptional buyer easily accessible your cost target actualizing your
utility in your to the mass of to profit at your business idea? Are
business idea? buyers? strategic price? you addressing
them up front?

25. Reach Beyond Existing Demand
 First Tier: “Soon-to-be” non-
customers who are on the
edge of your market, waiting
Third to jump ship
Tier
Second
First Tier
Tier  Second Tier: “Refusing non-
Your customers who consciously
Market choose against your market.
 Third Tier: “Unexplored” non
customers who are in
markets distant from yours.

26. Impact of Creating Blue Oceans

27. • Nintendo
• Samsung
• Maritz
• Dupont
• Cemex Some BLUE adopters
• Syngenta
• Cirque du Soleil
• Home Depot
• Federal Express
• Southwest Airlines
• CNN
• Netjets
• Apple

28. Is Tata Nano Really Creating a
Blue Ocean ?
High Small Car
Nano
2 Wheeler
Low

29. Get inspired…
“To fight and conquer in all your
battles is not supreme excellence.
Supreme excellence is in breaking
the enemy’s resistance without
fighting.”
Master Sun Tzu in
“Art of War’

30. Get inspired…
This is not the end!
It is not even the
beginning of the end.
But it is, perhaps,
the end of Blue Ocean
beginning of a
Red Ocean
30