The document discusses various frameworks and tools for developing a blue ocean strategy, including:
1. The value innovation framework which focuses on reducing factors industries compete on and raising/creating new elements of buyer value.
2. The strategy canvas tool which maps factors industries compete on and the levels of buyer value offered to identify opportunities.
3. The four actions framework which involves eliminating, reducing, raising, and creating factors to break industry trade-offs and create new value.
4. Additional tools like the buyer utility map, price corridor, profit model, and blue ocean idea index help validate blue ocean ideas and ensure commercial viability.
DoCoMo I-mode Japan passes the blue ocean idea index test by scoring positively on utility, price, cost and addressing adoption hurdles. In contrast, Philips CD-i and Motorola Iridium scored negatively on most or all factors.
This document discusses the concept of blue ocean strategy, which involves creating new market space rather than competing in existing or "red ocean" markets. It explains that blue oceans are defined by untapped market demand, while red oceans involve competition over existing demand. The document outlines principles for formulating a blue ocean strategy, including reconstructing market boundaries, focusing on the big picture rather than numbers, and getting the strategic sequence right. Tools for blue ocean strategy creation are presented, such as the strategy canvas for mapping the current industry state and a company's strategic moves, and the four actions framework for eliminating, reducing, raising, and creating strategic factors. Characteristics of effective blue ocean strategies and risks to avoid with red ocean thinking are also summarized
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.
The Blue Ocean Strategy is the art and science of making the competition irrelevant by creating uncontested market spaces. It is the mantra for winning in the marketplace without fighting the war. It argues that the best business strategy is to stop competing against competitors and create a blue ocean opportunity – a marketplace without any competition. Blue Ocean Strategy focuses on value innovations and lifting buyer values that could result in making conventional competition irrelevant and extend the industry boundaries and thereby creating un contested market space by tapping the untapped market space or by creating demand.
This is part 2 of the webinar series. In this part we will see how companies like zynga, khan academy and indochino have successfully applied the Principles of Blue Ocean Strategy.
Blue Ocean Strategy - Making Competition Irrelevant - Part 1Regalix
Every company today is in search of sustained profitable growth and competitive advantage; companies are competing hard amongst each other for customers, market share, cost leadership, value leadership etc. Despite best efforts no one’s winning because it’s still a zero – sum game for the industry because the size of the market is fixed and everybody is doing same or similar things resulting in negligible differentiation or innovation.
The Blue Ocean Strategy is the art and science of making the competition irrelevant by creating uncontested market spaces. It is the mantra for winning in the marketplace without fighting the war. It argues that the best business strategy is to stop competing against competitors and create a blue ocean opportunity – a marketplace without any competition. Blue Ocean Strategy focuses on value innovations and lifting buyer values that could result in making conventional competition irrelevant and extend the industry boundaries and thereby creating un contested market space by tapping the untapped market space or by creating demand.
In this first of the two part webinar series - you would be introduced to the following concepts and frameworks through interactive and latest case studies:
Red Oceans and Blue Oceans
Creating Strategy Canvas
The Four Actions Framework
The Three Tiers Of Non Customers
This presentation series is derived from the most acknowledged best seller “The Blue Oceans Strategy” published in 2005, by Prof. Chan Kim and Renee Mauborgne of INSEAD.
This document provides an introduction to blue ocean strategy concepts including:
1) It describes the difference between red and blue oceans, with red oceans representing crowded, competitive markets and blue oceans representing new market spaces with opportunities for highly profitable growth.
2) It introduces the concepts of value innovation and creating blue oceans by aligning innovation with utility, price, and cost positions to break the value-cost trade-off and create new market demand.
3) It outlines the key analytical tools for formulating a blue ocean strategy including the strategy canvas to map the current competitive landscape, and the four actions framework of eliminate, reduce, raise, and create to reconstruct buyer value and shift the strategy canvas to open new blue ocean
Blue Ocean Strategy (BOS) is a framework for creating new market space and making competition irrelevant. It is based on a decade of research on strategic moves spanning over 100 years. BOS aims to create blue oceans of uncontested market space rather than fighting in existing red oceans. It provides tools like the strategy canvas and four actions framework to help formulate strategies that eliminate, reduce, raise, and create factors compared to industry standards. The six principles of BOS guide successful formulation through reconstructing market boundaries and focusing on the big picture rather than numbers. Executing BOS involves overcoming organizational hurdles and building fair processes and tipping point leadership into the strategy.
This is the concluding presentation of a two part webinar for Blue ocean strategy.
The presentation introduces the audience to the core principles of Blue Ocean Strategy - which comprise of the six steps viz 1) Reconstructing Market Boundaries 2) Focusing on the Big Picture 3) Reaching Beyond Existing Demand 4) Getting the strategic sequence right 5) Overcoming organizational Challenges 1) Building execution into strategy.
The presentation also focuses on How the Boundaries can be reconstructed with 6 Paths Framework, How one can focus on big Picture by utilizing the visual strategy framework and PMS Maps, How One can reach beyond the existing demand by utilizing the Three tiers of Non Customers framework, How one can get their strategic sequence right by utilizing the buyer utility map, Price corridor of masses and overcoming organization hurdles framework.
The presentation also details on how to overcome the organizational hurdles and ways of building execution into strategy.
This presentation is aimed at explaining the greatness of Blue ocean strategy thinking to general audience through simple means and examples and does not imply distortion of facts and frameworks of the original Authors: Chan Kim, Renee Mauborgne
DoCoMo I-mode Japan passes the blue ocean idea index test by scoring positively on utility, price, cost and addressing adoption hurdles. In contrast, Philips CD-i and Motorola Iridium scored negatively on most or all factors.
This document discusses the concept of blue ocean strategy, which involves creating new market space rather than competing in existing or "red ocean" markets. It explains that blue oceans are defined by untapped market demand, while red oceans involve competition over existing demand. The document outlines principles for formulating a blue ocean strategy, including reconstructing market boundaries, focusing on the big picture rather than numbers, and getting the strategic sequence right. Tools for blue ocean strategy creation are presented, such as the strategy canvas for mapping the current industry state and a company's strategic moves, and the four actions framework for eliminating, reducing, raising, and creating strategic factors. Characteristics of effective blue ocean strategies and risks to avoid with red ocean thinking are also summarized
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.
The Blue Ocean Strategy is the art and science of making the competition irrelevant by creating uncontested market spaces. It is the mantra for winning in the marketplace without fighting the war. It argues that the best business strategy is to stop competing against competitors and create a blue ocean opportunity – a marketplace without any competition. Blue Ocean Strategy focuses on value innovations and lifting buyer values that could result in making conventional competition irrelevant and extend the industry boundaries and thereby creating un contested market space by tapping the untapped market space or by creating demand.
This is part 2 of the webinar series. In this part we will see how companies like zynga, khan academy and indochino have successfully applied the Principles of Blue Ocean Strategy.
Blue Ocean Strategy - Making Competition Irrelevant - Part 1Regalix
Every company today is in search of sustained profitable growth and competitive advantage; companies are competing hard amongst each other for customers, market share, cost leadership, value leadership etc. Despite best efforts no one’s winning because it’s still a zero – sum game for the industry because the size of the market is fixed and everybody is doing same or similar things resulting in negligible differentiation or innovation.
The Blue Ocean Strategy is the art and science of making the competition irrelevant by creating uncontested market spaces. It is the mantra for winning in the marketplace without fighting the war. It argues that the best business strategy is to stop competing against competitors and create a blue ocean opportunity – a marketplace without any competition. Blue Ocean Strategy focuses on value innovations and lifting buyer values that could result in making conventional competition irrelevant and extend the industry boundaries and thereby creating un contested market space by tapping the untapped market space or by creating demand.
In this first of the two part webinar series - you would be introduced to the following concepts and frameworks through interactive and latest case studies:
Red Oceans and Blue Oceans
Creating Strategy Canvas
The Four Actions Framework
The Three Tiers Of Non Customers
This presentation series is derived from the most acknowledged best seller “The Blue Oceans Strategy” published in 2005, by Prof. Chan Kim and Renee Mauborgne of INSEAD.
This document provides an introduction to blue ocean strategy concepts including:
1) It describes the difference between red and blue oceans, with red oceans representing crowded, competitive markets and blue oceans representing new market spaces with opportunities for highly profitable growth.
2) It introduces the concepts of value innovation and creating blue oceans by aligning innovation with utility, price, and cost positions to break the value-cost trade-off and create new market demand.
3) It outlines the key analytical tools for formulating a blue ocean strategy including the strategy canvas to map the current competitive landscape, and the four actions framework of eliminate, reduce, raise, and create to reconstruct buyer value and shift the strategy canvas to open new blue ocean
Blue Ocean Strategy (BOS) is a framework for creating new market space and making competition irrelevant. It is based on a decade of research on strategic moves spanning over 100 years. BOS aims to create blue oceans of uncontested market space rather than fighting in existing red oceans. It provides tools like the strategy canvas and four actions framework to help formulate strategies that eliminate, reduce, raise, and create factors compared to industry standards. The six principles of BOS guide successful formulation through reconstructing market boundaries and focusing on the big picture rather than numbers. Executing BOS involves overcoming organizational hurdles and building fair processes and tipping point leadership into the strategy.
This is the concluding presentation of a two part webinar for Blue ocean strategy.
The presentation introduces the audience to the core principles of Blue Ocean Strategy - which comprise of the six steps viz 1) Reconstructing Market Boundaries 2) Focusing on the Big Picture 3) Reaching Beyond Existing Demand 4) Getting the strategic sequence right 5) Overcoming organizational Challenges 1) Building execution into strategy.
The presentation also focuses on How the Boundaries can be reconstructed with 6 Paths Framework, How one can focus on big Picture by utilizing the visual strategy framework and PMS Maps, How One can reach beyond the existing demand by utilizing the Three tiers of Non Customers framework, How one can get their strategic sequence right by utilizing the buyer utility map, Price corridor of masses and overcoming organization hurdles framework.
The presentation also details on how to overcome the organizational hurdles and ways of building execution into strategy.
This presentation is aimed at explaining the greatness of Blue ocean strategy thinking to general audience through simple means and examples and does not imply distortion of facts and frameworks of the original Authors: Chan Kim, Renee Mauborgne
Between 1975 and 1995, 60% of Fortune 500 companies were replaced, showing that markets and competitors are constantly changing. Industries and companies continuously rise and fall, so there are no permanently dominant players. Strategic moves that continuously create new value for customers allow companies to stay at the top. Value innovation aims to substantially raise customer value rather than focus only on new technologies. By identifying and serving overall customer needs through an unparalleled value proposition, companies can dominate their market.
Value innovation creates value for both buyers and the company by reducing costs through eliminating unnecessary factors while also increasing buyer value by introducing new elements. It aims to break the trade-off between low costs and differentiation.
Blue ocean strategy seeks to create new market space by making competitors irrelevant and capturing new demand rather than competing head-to-head in existing markets. It breaks the value-cost tradeoff through eliminating, reducing, raising and creating factors compared to industry standards.
The buyer utility map outlines six stages of the buyer experience and six levers companies can use to deliver exceptional utility at each stage from purchase to disposal.
The document discusses red and blue oceans in business. Red oceans represent existing industries with defined competition, while blue oceans represent uncontested market space without competition. It advocates pursuing differentiation and low cost simultaneously through value innovation to create a blue ocean and make competition irrelevant. Strategies discussed include reducing unnecessary factors, eliminating redundancies, raising what is below standards, and creating new benefits customers value. Analyzing potential new customers, including those on the edge of exiting, refusing, and unexplored markets, is also recommended to open new blue oceans. Examples given of companies creating blue oceans include Ralph Lauren, Pfizer, and Cirque Du Soleil.
This document provides an overview of a Blue Ocean Strategy simulation developed by StratX. The simulation is designed to teach participants about Blue Ocean Strategy concepts developed by W. Chan Kim and Renée Mauborgne. In the simulation, participants manage a fictitious company competing in the game console industry over multiple decision rounds. The rounds progress from competing in existing red ocean markets to attempting to create blue oceans of uncontested market space through value innovation and other Blue Ocean Strategy tools and frameworks.
The document discusses the concept of blue ocean strategy using Cirque du Soleil as an example. It provides an overview of key principles of blue ocean strategy, including reconstructing market boundaries to look across different industries and customer groups, focusing on the big picture rather than numbers, getting the strategic sequence right, and overcoming organizational hurdles to execute new strategies. The document also outlines analytical tools for developing blue ocean strategies, such as strategy canvases and value curves.
Red ocean strategy involves competing in existing market space against competitors, while blue ocean strategy creates new market space without competition. Key tools for blue ocean strategy include the strategy canvas, which visually captures current and future strategic positioning; the 4 Actions framework for reconstructing buyer value; and the ERRC grid for eliminating/reducing and raising/creating factors. Fair process builds execution into strategy through engagement, explanation, and clarity of expectations.
This document discusses Apple's use of blue ocean strategy to drive innovation and business success. It provides an overview of blue ocean strategy concepts like creating uncontested market space, focusing on non-customers, and using value innovation to eliminate, reduce, raise and create new elements. The document then analyzes Apple's strategic moves like simplifying interfaces, adding applications and improving design to attract new customers beyond the existing market. Finally, it discusses frameworks and principles for formulating and executing blue ocean strategies while minimizing risks.
The document summarizes key concepts from Blue Ocean Strategy, including:
1. Value innovation focuses on making competitors irrelevant by creating value for buyers and the company, opening new market space.
2. The strategy canvas is used to analyze an industry's factors of competition and a company's offerings relative to competitors.
3. Blue ocean strategy aims to reconstruct industry boundaries and break the value-cost tradeoff to drive differentiation and low costs simultaneously.
1) Value innovation is created when a company's actions favorably affect both its cost structure and value proposition to buyers, eliminating factors on which the industry competes while raising and creating new elements.
2) It focuses on making competition irrelevant by creating a leap in value for buyers and the company, opening new uncontested market space.
3) Value innovation aligns innovation with utility, price, and cost positions to break the value-cost trade-off and drive costs down while raising buyer value.
The document discusses the concept of blue ocean strategy, which involves creating new market space by changing the boundaries of an existing industry. It outlines key principles such as reconstructing market boundaries, focusing on non-customers, and using a strategy canvas to visualize new opportunities. The strategy aims to make competition irrelevant by creating uncontested market space through eliminating or reducing some industry factors while introducing new ones.
The document summarizes key concepts from the book "Blue Ocean Strategy" by W. Chan Kim and Renée Mauborgne. It discusses how companies can create new market space, or "blue oceans", by focusing on value innovation to increase value for customers and decrease costs. It outlines analytical tools like the strategy canvas and frameworks like eliminate-reduce-raise-create to help companies reconstruct market boundaries. Finally, it discusses how to visualize strategy and understand the different tiers of potential customers, including non-customers, to help actualize a viable blue ocean idea.
This is the first presentation of a two part webinar for Blue ocean strategy.
The presentation introduces to red ocean and blue ocean companies, How blue ocean strategy is a simultaneous pursuit of cost and value.
The presentation provides a quick introduction with new age examples to strategy canvas, 6 paths framework, four actions frame work, buyer utility map, 3 tiers of non customers and PMS maps.
The presentation also utilizes these frameworks in showcasing descriptive case studies of companies like netjets, indochino.com, Zynga and khan academy.
This presentation is aimed at explaining the greatness of Blue ocean strategy thinking to general audience and does not imply distortion of facts and frameworks of the original Authors: Chan Kim, Renee Mauborgne
Blue Ocean strategy Outguns Red Ocean Strategy - AnshumaliiAnshumali Saxena
This document discusses blue ocean strategy and how it differs from traditional red ocean strategy. It provides examples of companies like Cirque du Soleil that achieved great success by creating new market space rather than competing head-to-head in existing markets. The key aspects of blue ocean strategy are value innovation, which involves raising buyer value and reducing costs, and reconstructing market boundaries to open up new demand. Visual tools like the strategy canvas are recommended to help companies map out blue ocean opportunities and shifts from their current "red ocean" approach. Reaching beyond existing demand by exploring non-customers is also an important part of blue ocean strategy.
Blue Ocean Strategy is about creating new market space and making competition irrelevant. [1] A red ocean is the existing market space where competition is fierce as industry boundaries are defined. [2] A blue ocean denotes all industries not in existence, where demand is created rather than fought over, allowing for rapid growth. [3] Blue ocean strategy involves eliminating and reducing factors the industry takes for granted, while creating and raising new factors to open blue oceans and make the competition irrelevant.
This is a partial preview of the document found here:
https://flevy.com/browse/business-document/blue-ocean-strategy-primer-113
Description:
A great complement to the best selling book "Blue Ocean Strategy." Each chapter is summarized in one printer-friendly slide. Points that require more in-depth explanation are developed into additional slides. Save time and get a quick refresh with this primer for you to enjoy.
This document discusses Blue Ocean Strategy (BOS), which aims to create new market space by challenging conventional assumptions about competition. BOS reconstructs market boundaries to reach beyond existing demand. Examples provided include Cirque du Soleil creating a new circus format targeting adults, and Casella Winery marketing wine to new customers. The six paths to create blue oceans are examining alternative industries, strategic groups, buyer groups, complementary services, functional/emotional orientations, and time trends. Implementation involves workshops to develop new market spaces not constrained by existing boundaries and features.
The document summarizes key concepts from "The Blue Ocean Strategy" book. It discusses how blue ocean strategy involves creating uncontested market space by making competition irrelevant. It outlines value innovation as the cornerstone, which creates value for both buyers and companies. It presents frameworks like the four actions grid to eliminate, reduce, raise or create factors to break value-cost tradeoffs. It also discusses visualizing strategies, sequencing ideas through buyer utility/price/cost/adoption tests, and avoiding imitations through value innovation moves.
Value innovation creates favorable impacts on both cost structure and value proposition to buyers. It reduces costs by eliminating unnecessary industry factors and lifts buyer value by creating new elements the industry has never offered before. Over time, costs are reduced further through scale economies generated by superior value. Red ocean strategy competes in existing market space while blue ocean strategy creates uncontested market space to make competition irrelevant. The six principles of blue ocean strategy are reconstructing market boundaries, focusing on the big picture, reaching beyond existing demand, getting the strategic sequence right, overcoming organizational hurdles, and building execution into strategy.
This document summarizes key concepts from Blue Ocean Strategy by W. Chan Kim and Renee Mauborgne. It discusses how blue ocean strategy aims to create uncontested market space and make competition irrelevant by breaking the value-cost tradeoff. Key frameworks covered include the strategy canvas, four actions framework, buyer utility map, and sequence for validating blue ocean ideas. Overall, the document provides an overview of blue ocean strategy and the tools used to identify and capture new demand in unexplored market spaces.
The document discusses key concepts from Blue Ocean Strategy, including:
1. Value innovation is created by favorably affecting both cost structure and value proposition to buyers. Costs are reduced by eliminating competition factors while buyer value is increased by offering new elements.
2. Blue ocean strategy aims to create new market space by breaking the value-cost tradeoff, while red ocean strategy involves competing in existing market space on factors like cost or differentiation.
3. Tools for developing blue ocean strategy include the strategy canvas, four actions framework, buyer utility map, and analyzing the buyer experience cycle. The strategic sequence and evaluating ideas on utility, price, cost and adoption are also discussed.
Between 1975 and 1995, 60% of Fortune 500 companies were replaced, showing that markets and competitors are constantly changing. Industries and companies continuously rise and fall, so there are no permanently dominant players. Strategic moves that continuously create new value for customers allow companies to stay at the top. Value innovation aims to substantially raise customer value rather than focus only on new technologies. By identifying and serving overall customer needs through an unparalleled value proposition, companies can dominate their market.
Value innovation creates value for both buyers and the company by reducing costs through eliminating unnecessary factors while also increasing buyer value by introducing new elements. It aims to break the trade-off between low costs and differentiation.
Blue ocean strategy seeks to create new market space by making competitors irrelevant and capturing new demand rather than competing head-to-head in existing markets. It breaks the value-cost tradeoff through eliminating, reducing, raising and creating factors compared to industry standards.
The buyer utility map outlines six stages of the buyer experience and six levers companies can use to deliver exceptional utility at each stage from purchase to disposal.
The document discusses red and blue oceans in business. Red oceans represent existing industries with defined competition, while blue oceans represent uncontested market space without competition. It advocates pursuing differentiation and low cost simultaneously through value innovation to create a blue ocean and make competition irrelevant. Strategies discussed include reducing unnecessary factors, eliminating redundancies, raising what is below standards, and creating new benefits customers value. Analyzing potential new customers, including those on the edge of exiting, refusing, and unexplored markets, is also recommended to open new blue oceans. Examples given of companies creating blue oceans include Ralph Lauren, Pfizer, and Cirque Du Soleil.
This document provides an overview of a Blue Ocean Strategy simulation developed by StratX. The simulation is designed to teach participants about Blue Ocean Strategy concepts developed by W. Chan Kim and Renée Mauborgne. In the simulation, participants manage a fictitious company competing in the game console industry over multiple decision rounds. The rounds progress from competing in existing red ocean markets to attempting to create blue oceans of uncontested market space through value innovation and other Blue Ocean Strategy tools and frameworks.
The document discusses the concept of blue ocean strategy using Cirque du Soleil as an example. It provides an overview of key principles of blue ocean strategy, including reconstructing market boundaries to look across different industries and customer groups, focusing on the big picture rather than numbers, getting the strategic sequence right, and overcoming organizational hurdles to execute new strategies. The document also outlines analytical tools for developing blue ocean strategies, such as strategy canvases and value curves.
Red ocean strategy involves competing in existing market space against competitors, while blue ocean strategy creates new market space without competition. Key tools for blue ocean strategy include the strategy canvas, which visually captures current and future strategic positioning; the 4 Actions framework for reconstructing buyer value; and the ERRC grid for eliminating/reducing and raising/creating factors. Fair process builds execution into strategy through engagement, explanation, and clarity of expectations.
This document discusses Apple's use of blue ocean strategy to drive innovation and business success. It provides an overview of blue ocean strategy concepts like creating uncontested market space, focusing on non-customers, and using value innovation to eliminate, reduce, raise and create new elements. The document then analyzes Apple's strategic moves like simplifying interfaces, adding applications and improving design to attract new customers beyond the existing market. Finally, it discusses frameworks and principles for formulating and executing blue ocean strategies while minimizing risks.
The document summarizes key concepts from Blue Ocean Strategy, including:
1. Value innovation focuses on making competitors irrelevant by creating value for buyers and the company, opening new market space.
2. The strategy canvas is used to analyze an industry's factors of competition and a company's offerings relative to competitors.
3. Blue ocean strategy aims to reconstruct industry boundaries and break the value-cost tradeoff to drive differentiation and low costs simultaneously.
1) Value innovation is created when a company's actions favorably affect both its cost structure and value proposition to buyers, eliminating factors on which the industry competes while raising and creating new elements.
2) It focuses on making competition irrelevant by creating a leap in value for buyers and the company, opening new uncontested market space.
3) Value innovation aligns innovation with utility, price, and cost positions to break the value-cost trade-off and drive costs down while raising buyer value.
The document discusses the concept of blue ocean strategy, which involves creating new market space by changing the boundaries of an existing industry. It outlines key principles such as reconstructing market boundaries, focusing on non-customers, and using a strategy canvas to visualize new opportunities. The strategy aims to make competition irrelevant by creating uncontested market space through eliminating or reducing some industry factors while introducing new ones.
The document summarizes key concepts from the book "Blue Ocean Strategy" by W. Chan Kim and Renée Mauborgne. It discusses how companies can create new market space, or "blue oceans", by focusing on value innovation to increase value for customers and decrease costs. It outlines analytical tools like the strategy canvas and frameworks like eliminate-reduce-raise-create to help companies reconstruct market boundaries. Finally, it discusses how to visualize strategy and understand the different tiers of potential customers, including non-customers, to help actualize a viable blue ocean idea.
This is the first presentation of a two part webinar for Blue ocean strategy.
The presentation introduces to red ocean and blue ocean companies, How blue ocean strategy is a simultaneous pursuit of cost and value.
The presentation provides a quick introduction with new age examples to strategy canvas, 6 paths framework, four actions frame work, buyer utility map, 3 tiers of non customers and PMS maps.
The presentation also utilizes these frameworks in showcasing descriptive case studies of companies like netjets, indochino.com, Zynga and khan academy.
This presentation is aimed at explaining the greatness of Blue ocean strategy thinking to general audience and does not imply distortion of facts and frameworks of the original Authors: Chan Kim, Renee Mauborgne
Blue Ocean strategy Outguns Red Ocean Strategy - AnshumaliiAnshumali Saxena
This document discusses blue ocean strategy and how it differs from traditional red ocean strategy. It provides examples of companies like Cirque du Soleil that achieved great success by creating new market space rather than competing head-to-head in existing markets. The key aspects of blue ocean strategy are value innovation, which involves raising buyer value and reducing costs, and reconstructing market boundaries to open up new demand. Visual tools like the strategy canvas are recommended to help companies map out blue ocean opportunities and shifts from their current "red ocean" approach. Reaching beyond existing demand by exploring non-customers is also an important part of blue ocean strategy.
Blue Ocean Strategy is about creating new market space and making competition irrelevant. [1] A red ocean is the existing market space where competition is fierce as industry boundaries are defined. [2] A blue ocean denotes all industries not in existence, where demand is created rather than fought over, allowing for rapid growth. [3] Blue ocean strategy involves eliminating and reducing factors the industry takes for granted, while creating and raising new factors to open blue oceans and make the competition irrelevant.
This is a partial preview of the document found here:
https://flevy.com/browse/business-document/blue-ocean-strategy-primer-113
Description:
A great complement to the best selling book "Blue Ocean Strategy." Each chapter is summarized in one printer-friendly slide. Points that require more in-depth explanation are developed into additional slides. Save time and get a quick refresh with this primer for you to enjoy.
This document discusses Blue Ocean Strategy (BOS), which aims to create new market space by challenging conventional assumptions about competition. BOS reconstructs market boundaries to reach beyond existing demand. Examples provided include Cirque du Soleil creating a new circus format targeting adults, and Casella Winery marketing wine to new customers. The six paths to create blue oceans are examining alternative industries, strategic groups, buyer groups, complementary services, functional/emotional orientations, and time trends. Implementation involves workshops to develop new market spaces not constrained by existing boundaries and features.
The document summarizes key concepts from "The Blue Ocean Strategy" book. It discusses how blue ocean strategy involves creating uncontested market space by making competition irrelevant. It outlines value innovation as the cornerstone, which creates value for both buyers and companies. It presents frameworks like the four actions grid to eliminate, reduce, raise or create factors to break value-cost tradeoffs. It also discusses visualizing strategies, sequencing ideas through buyer utility/price/cost/adoption tests, and avoiding imitations through value innovation moves.
Value innovation creates favorable impacts on both cost structure and value proposition to buyers. It reduces costs by eliminating unnecessary industry factors and lifts buyer value by creating new elements the industry has never offered before. Over time, costs are reduced further through scale economies generated by superior value. Red ocean strategy competes in existing market space while blue ocean strategy creates uncontested market space to make competition irrelevant. The six principles of blue ocean strategy are reconstructing market boundaries, focusing on the big picture, reaching beyond existing demand, getting the strategic sequence right, overcoming organizational hurdles, and building execution into strategy.
This document summarizes key concepts from Blue Ocean Strategy by W. Chan Kim and Renee Mauborgne. It discusses how blue ocean strategy aims to create uncontested market space and make competition irrelevant by breaking the value-cost tradeoff. Key frameworks covered include the strategy canvas, four actions framework, buyer utility map, and sequence for validating blue ocean ideas. Overall, the document provides an overview of blue ocean strategy and the tools used to identify and capture new demand in unexplored market spaces.
The document discusses key concepts from Blue Ocean Strategy, including:
1. Value innovation is created by favorably affecting both cost structure and value proposition to buyers. Costs are reduced by eliminating competition factors while buyer value is increased by offering new elements.
2. Blue ocean strategy aims to create new market space by breaking the value-cost tradeoff, while red ocean strategy involves competing in existing market space on factors like cost or differentiation.
3. Tools for developing blue ocean strategy include the strategy canvas, four actions framework, buyer utility map, and analyzing the buyer experience cycle. The strategic sequence and evaluating ideas on utility, price, cost and adoption are also discussed.
The document summarizes several key concepts from Blue Ocean Strategy:
1. Value innovation is created by favorably affecting both cost structure and value proposition to buyers by eliminating/reducing competition factors and raising/creating new elements.
2. Blue ocean strategy aims to create new market space by breaking the value-cost tradeoff, while red ocean strategy pursues differentiation or low cost within existing industry boundaries.
3. Tools like the strategy canvas, four actions framework, and buyer utility map help analyze industries and identify factors to eliminate, reduce, raise or create for blue ocean opportunities.
The document discusses key concepts from Blue Ocean Strategy, including:
1. Value innovation is created by favorably affecting both cost structure and value proposition to buyers. Costs are reduced by eliminating competition factors while buyer value is increased by offering new elements.
2. Blue ocean strategy aims to create new market space by breaking the value-cost tradeoff, while red ocean strategy involves competing in existing market space on factors like cost or differentiation.
3. Tools for developing blue ocean strategy include the strategy canvas, four actions framework, buyer utility map, and analyzing the buyer experience cycle. The strategic sequence and evaluating ideas on utility, price, cost and adoption are also discussed.
The document summarizes several key concepts from Blue Ocean Strategy:
1. Value innovation is created by favorably affecting both cost structure and value proposition to buyers by eliminating/reducing competition factors and raising/creating new elements.
2. Blue ocean strategy aims to create new market space by breaking the value-cost tradeoff, while red ocean strategy pursues differentiation or low cost within existing industry boundaries.
3. Tools like the strategy canvas, four actions framework, and buyer utility map help analyze industries and formulate blue ocean strategies.
The document discusses key concepts from Blue Ocean Strategy, including:
1. Value innovation is created by favorably affecting both cost structure and value proposition to buyers. Costs are reduced by eliminating competition factors while buyer value is increased by offering new elements.
2. Blue ocean strategy aims to create new market space by breaking the value-cost tradeoff, while red ocean strategy involves competing in existing market space on factors like cost or differentiation.
3. Tools for developing blue ocean strategy include the strategy canvas, four actions framework, buyer utility map, and analyzing the buyer experience cycle. The strategic sequence and evaluating ideas on utility, price, cost and adoption are also discussed.
The document summarizes key concepts from Blue Ocean Strategy. It discusses value innovation as creating value for both the company and buyers by eliminating or reducing competition factors and raising or creating new elements. It contrasts red ocean strategy of competing within existing industry boundaries versus blue ocean strategy of creating new market space without competition. The six principles of blue ocean strategy aim to reconstruct market boundaries, reach beyond existing demand, and overcome organizational hurdles to strategy execution. Tools like the strategy canvas, four actions framework, and profit model are presented to help visualize and implement blue ocean strategies.
This document discusses Blue Ocean Strategy, which involves creating new market space and demand rather than competing in existing markets. It summarizes key aspects of Blue Ocean Strategy, including value innovation to raise buyer value and reduce costs, the four actions framework to create a new value curve, and the six principles of reducing management, organizational, business model, execution, scale, and search risks. It also outlines the four steps of visualizing blue ocean strategy and the three tiers of potential new customers.
Lecture 5 discusses strategic entrepreneurship and Blue Ocean Strategy. Blue Ocean Strategy involves creating new market space by breaking from competitive rules to make competition irrelevant. An example is provided of how [yellow tail] wine created a blue ocean by offering an inexpensive, easy-drinking wine that eliminated complexity and prestige in favor of accessibility. Tools like the Strategy Canvas and Four-Actions Framework help analyze industries and design innovative products that open blue oceans.
This document discusses the concept of "blue ocean strategy", which involves creating new market space by exploring opportunities outside existing industry boundaries to make competition irrelevant. It provides an overview of the key principles of blue ocean strategy, including researching historical examples of blue ocean creation, focusing on factors to reduce, eliminate, create and raise to open new markets. It also outlines frameworks for analyzing strategic moves and minimizing risks in formulating and executing blue ocean strategies.
This document discusses the concept of "blue ocean strategy", which involves creating new market space by exploring opportunities outside existing industry boundaries to make competition irrelevant. It provides an overview of the key principles of blue ocean strategy, including researching historical examples of blue ocean creation, focusing on factors to reduce, eliminate, create or raise to differentiate from competitors. The document also outlines frameworks for analyzing strategic moves, minimizing risks and maximizing opportunities when formulating and executing a blue ocean strategy.
This document discusses the concept of "blue ocean strategy", which involves creating new market space by exploring opportunities outside existing industry boundaries to render competition irrelevant. It outlines key principles of blue ocean strategy, including reconstructing market boundaries, focusing on the big picture rather than numbers, reaching beyond existing demand, and getting the strategic sequence right. The document also notes risks to consider in both formulating and executing a blue ocean strategy.
Competition is over crowded industries is no way to sustain high performance. The real opportunity is to create blue oceans of uncontested market space.
This document discusses the concept of "blue ocean strategy", which involves creating new market space by exploring opportunities outside existing industry boundaries to make competition irrelevant. It provides an overview of the key principles of blue ocean strategy, including researching historical examples of blue ocean creation, focusing on differentiation rather than competition, and breaking the traditional value-cost tradeoff. Frameworks like the strategy canvas and four actions model are presented to help visualize and implement blue ocean strategies. Risks in both formulating and executing these new market approaches are also outlined.
The Blue Ocean Strategy outlines how to create new market space and make competition irrelevant. It discusses moving from "red oceans" of bloody competition to "blue oceans" of wide open opportunities. The key tools presented are the strategy canvas to analyze the current market space and the four actions framework to reconstruct market boundaries by eliminating or reducing certain factors while creating or raising others. Principles for formulating a blue ocean strategy include reconstructing market boundaries, focusing on the big picture rather than numbers, reaching beyond existing demand, and getting the strategic sequence right. Executing the strategy requires overcoming organizational hurdles and building an execution plan.
The document summarizes the key concepts from the book Blue Ocean Strategy, which discusses how companies can create new market space and make competition irrelevant. It outlines the difference between red and blue ocean strategies, and tools like the strategy canvas and four action framework. Examples are given of companies like Cirque du Soleil and Southwest Airlines that created blue oceans. Principles for formulating a blue ocean strategy include reconstructing market boundaries and focusing on the big picture rather than numbers. Overcoming organizational hurdles is important for execution.
1. By: W. Chan Kim & Renee Mauborgne
Summary by: Jesse Starmer
COM 459
2. Value Innovation
Value innovation is created in the region where a company’s actions favorably affect both
its cost structure and its value proposition to buyers. Cost savings are made by eliminating
and reducing the factors an industry competes on. Buyer value is lifted by raising and
creating elements the industry has never offered. Over time, costs are reduced further as
scale economies kick in due to the high sales volumes that superior value generates.
Costs
Value
Innovation
Buyer Value
4. Red Ocean Versus Blue Ocean Startegy
In the red ocean, differentiation costs because firms compete with the
same best-practice principle. Here, the strategic choices for firms are to
pursue either differentiation or low cost. In the reconstructionist world,
however, the strategic aim is to create new best-practice rules by breaking
the existing value-cost trade-off and thereby creating blue ocean.
Red Ocean Strategy Blue Ocean Strategy
Compete in existing market space. Create uncontested market 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 firm’s Align the whole system of a firm’s
activities with its strategic choice of activities in pursuit of differentiation
differentiation or low cost. and low cost.
5. Red Ocean Versus Blue Ocean Strategy
Red Ocean Strategy Blue Ocean Strategy
6. The Six Principles of Blue Ocean Strategy
This figure highlights the six principles driving the successful formulation
and execution of blue ocean strategy and the risks that these principles
attenuate.
Formulation Principles Risk factor each principle attenuates
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
Evaluation principles Risk factor each principle attenuates
Overcome key organizational hurdles Organizational risk
Build execution into strategy Management risk
7. The Six Principles of Blue Ocean Strategy
Formulation Principles Risk factor each principle attenuates
Evaluation principles Risk factor each principle attenuates
8. Strategy Canvas
The strategy canvas is both a diagnostic and an action framework for building a
compelling blue ocean strategy. It captures the current state of play in the known
market space. This allows you to understand where the competition is currently
investing, the factors the industry currently competes on in products, service, and
delivery, and what customers receive from the existing competitive offerings on the
market. The horizontal axis captures the range of factors the industry competes on
an invests in. The vertical axis captures the offering level that buyers receive across
all these key competing factors. The value curve then provides a graphic depiction
of a company’s relative performance across its industry’s factors of competition.
High
Low
Above-the-line Vineyard prestige Wine range
Price Use of
enological marketing Aging and legacy Wine
terminology quality complexity
10. Four Actions Framework +
Eliminate/Reduce/Raise/Create Grid
Reduce
The four actions framework offers an Which factors should be
technique that breaks the trade-off between reduced well below
industry standards?
differentiation and low cost and to create a
new value curve. It answers the four key
questions of what industry takes for granted Eliminate A Create
Which of the factors New Which factors should be
and needs to be eliminated; what factors need Value created that the industry
that the industry takes
to be reduced below industry standards; what for granted should be Curve has never offered?
factors need to be raised above industry eliminated?
standards; and what should be created that Raise
the industry has never offered. Which factors should
be raised well above
the industry’s standard?
Eliminate Raise The eliminate-reduce-raise-create grid pushes
Enological terminology and Price versus budget wines companies not only to ask all four questions in
distinctions
the four actions framework but also to act on all
Retail Store involvement
Aging qualities four to create a new value curve. By driving
companies to fill in the grid with the actions of
Above-the-line marketing eliminating, reducing, raising, and creating, the
Reduce Create
grid provides four immediate benefits: it pushes
Wine complexity Easy drinking them to simultaneously pursue differentiation and
low costs; identifies companies who are only
Wine range Ease of selection raising and creating thereby raising costs; makes
Vineyard prestige Fun and adventure
it easier for managers to understand and comply;
and it drives companies to scrutinize every factor
the industry competes on.
11. Four Actions Framework +
Eliminate/Reduce/Raise/Create Grid
Reduce
Four Actions Framework
Eliminate Create
A New
Value
Curve
Raise
Eliminate Raise
Reduce Create
The Eliminate-Reduce-Raise-Create
Grid
12. Four Steps of Visualizing Strategy
The four steps of visualizing strategy builds on the six paths of creating blue
oceans and involves a lot of visual stimulation in order to unlock people’s
creativity. The four steps include visual awakening, visual exploration, visual
strategy fair, and visual communication.
1. Visual 2. Visual 3. Visual Strategy 4. Visual
Awakening Exploration Fair Communicatio
n
•Compare your •Go into the field to •Draw your “to be” strategy •Distribute your before-
business with your explore the six paths to canvas based on insights and-after strategic profiles
competitors’ by creating blue oceans. from field observations. on one page for easy
drawing your “as is” comparison.
strategy canvas. •Observe the distinctive •Get feedback on
advantages of alternative strategy •Support only those
•See where your alternative products and canvases from customers, projects and operational
strategy needs to services. competitors’ customers, moves that allow your
change and noncustomers. company to close the
•See which factors you gaps to actualize the new
should eliminate, •Use feedback to build the strategy.
create, or change. best “to be” future strategy.
13. Four Steps of Visualizing Strategy
1. Visual 2. Visual 3. Visual 4. Visual
Awakening Exploration Strategy Fair Communication
14. Pioneer, Settler, Migrator Map
A corporate management team pursuing profitable growth can plot the
company’s current and planned portfolios on a pioneer-migrator-settler
(PMS) map. This strategy can help a company determine which businesses
experience the highest and lowest growth and cash flow. These are
classified accordingly with the highest growth potential being pioneers, then
to migrators, then to the lowest rung, settlers.
Pioneers
Migrators
Settlers
Today Tomorrow
16. Three Tiers of Noncustomers
There are three tiers of noncustomers that can be transformed into
customers. They differ in their relative distance from your market. The
first tier of customers minimally buy an industry’s offering out of necessity.
The second tier of noncustomers refuse to use your industries offerings.
The third tier are noncustomers who have never thought of your market’s
offerings as an option.
Third
Second Tier
Tier
First
Tier
Your
Market
18. Sequence of Blue Ocean Strategy
Buyer utility
Is there exceptional buyer utility in your
business idea?
No-- Rethink
An important part of blue ocean strategy is to Yes
“get the strategic sequence right.” This Price
sequence fleshes out and validates blue
Is your price easily accessible to the
ocean ideas to ensure their commercial mass of buyers?
viability. This can then reduce business No-- Rethink
model risk. In this model, potential blue Yes
ocean ideas must pass through a sequence
of buyer utility, price, cost, and adoption. At Cost
each step there are only two options: a “yes” Can you attain your cost target to profit
answer, in which case the idea may pass to at your strategic price?
No-- Rethink
the next step, or “no”. If an idea receives a
no at any point, the company can either park Yes
the idea or rethink it until you get a yes.
Adoption
What are the adoption hurdles in
actualizing your business idea? Are you
addressing them up front?
No-- Rethink
Yes
A Commercially
Viable Blue
Ocean Idea
19. Sequence of Blue Ocean Strategy
Buyer utility
No-- Rethink
Yes
Price
No-- Rethink
Yes
Cost
No-- Rethink
Yes
Adoption
No-- Rethink
Yes
A Commercially
Viable Blue
Ocean Idea
20. Buyer Utility Map
The buyer utility map helps managers look at this issue from the right
perspective. It outlines all the levers companies can pull to deliver exceptional
utility to buyers as well as the various experiences buyers can have with a
product or service.
The Six Stages of the Buyer Experience Cycle
1. 2. 3. 4. 5. 6.
Purchase Delivery Use Supplements Maintenance Disposal
Customer
Productivity
Simplicity
The Six Utility Levers
Convenience
Risk
Fun and
Image
Environmental
friendliness
21. Buyer Utility Map
The Six Stages of the Buyer Experience Cycle
1. 2. 3. 4. 5. 6.
Purchase Delivery Use Supplements Maintenance Disposal
Customer
Productivity
The Six Utility Levers
Simplicity
Convenience
Risk
Fun and
Image
Environmental
friendliness
22. Buyer Experience Cycle
A buyer’s experience can usually be broken into a cycle of six stages,
running more or less sequentially from purchase to disposal. Each
stage encompasses a wide variety of specific experiences. At each
stage, managers can ask a set of questions to gauge the quality of
buyer’s experience.
Purchase Delivery Use Supplements Maintenance Disposal
How long does it How long does Does the product Do you need other Does the product Does use of the
take to find the it take to get require training or products and require external product create
product you the product expert assistance? services to make maintenance? waste items?
need? delivered? this product work?
Is the product easy to How easy is it to How easy is it to
Is the place of How difficult is store when not in If so, how costly are maintain and dispose of the
purchase it to unpack use? they? upgrade the product?
attractive and and install the product?
How effective are the How much time do Are there legal
accessible? new product?
product’s features they take? How costly is or
How secure is Do buyers and functions? maintenance? environmental
How easy are they
the transaction have to issues in
Does the product or to obtain?
environment? arrange disposing of the
service deliver far
delivery product safely?
How rapidly can more power or
themselves? If
you make a options than required How costly is
yes, how costly
purchase? by the average user? disposal?
and difficult is
Is in overcharged with
this?
bells and whistles?
24. Uncovering Blocks to Buyer Utility
Uncovering blocks to buyer utility can identify the most compelling
hot spots to unlock exceptional utility. By locating your proposed
offering on the thirty-six space of the buyer utility map, you can
clearly see how, and whether the new idea not only creates a
different utility proposition from existing offerings but also
removes the biggest blocks to utility that stand in the way of
converting noncustomers into customers.
Purchase Delivery Use Supplements Maintenance Disposal
Customer Productivity: In which stage are the biggest blocks to customer productivity?
Simplicity: In which stages are the biggest blocks to simplicity?
Convenience: In which stage are the biggest blocks to convenience?
Risk: In which stage are the biggest blocks to reducing risks?
Fun and Image: In which stage are the biggest blocks to fun and image?
Environmental In which stage are the biggest blocks to environmental friendliness?
Friendliness:
25. Uncovering Blocks to Buyer Utility
Purchase Delivery Use Supplements Maintenance Disposal
Customer Productivity:
Simplicity:
Convenience:
Risk:
Fun and Image:
Environmental
Friendliness:
26. Price Corridor of the Mass
This tool helps managers find the right price for an irresistible offer, which, by
the way, isn’t necessarily the lower price. The tool involves two distinct buy
interrelated steps. The first step involves identifying the price corridor of the
mass which deals with customer price sensitivity and pricing strategies of
products offered outside the group of traditional competitors. The second step
deals with specifying a level within the price corridor which factors in legal
protection and exclusive assets.
Step 1: Identify the price corridor Step 2: Specify a price level within the
of the mass. price corridor.
Three alternative product/service types:
Different form and
Same Different form, function, same
form same function objective
High degree of legal and resource
protection
g
icin
l pr Difficult to imitate
er- leve
Upp
Some degree of legal and resource
Price Corridor protection
Mid-level pricing
of the Mass
Lower-le Low degree of legal and resource
v el pricin protection
g
Easy to imitate
27. Price Corridor of the Mass
Step 1: Identify the price Step 2: Specify a price level
corridor of the mass. within the price corridor.
Three alternative product/service types:
Different form
Same Different form, and function,
form same function same objective
High degree of legal and
resource protection
ing
l pric
eve Difficult to imitate
er-l
Upp
Price Some degree of legal and
Corridor of Mid-level pricing resource protection
the Mass
Lower-le Low degree of legal and
vel pric
ing resource protection
Easy to imitate
28. Profit Model of Blue Ocean Strategy
The profit model of blue ocean strategy shows how value
innovation typically maximizes profit by using the three levers of
strategic price, target cost, and pricing innovation.
The Strategic Price
The Target Profit
The Target Cost
Streamlining and Cost
Partnering
Innovations
Pricing Innovation
30. Blue Ocean Idea Index
The blue ocean idea index is a simple but robust test
demonstrating how the sequence of utility, price, cost, and
adoption form an integral whole to ensure commercial success
through blue ocean strategy.
DoCoMo
Philips Motorola I-mode
CD-i Iridium Japan
Utility Is there exceptional utility? Are there
compelling reasons to buy your offering? - -
+
Price Is your price easily accessible to the
mass of buyers? - - +
Cost Does your cost structure meet the target
cost? - - +
Adoption Have you addressed adoption hurdles up
front? - +/- +
31. Blue Ocean Idea Index
Utility Is there exceptional utility? Are there
compelling reasons to buy your offering?
Price Is your price easily accessible to the
mass of buyers?
Cost Does your cost structure meet the target
cost?
Adoption Have you addressed adoption hurdles up
front?