Innovation, new market space and creating demand are central characteristics. In this article you will learn how to make your competition irrelevant and have sales and profit growth in excess of anything you thought was even possible. In this way, it swam into a blue ocean, offering a plastic watch at a price that allowed people to purchase two or three watches at one time. Chan kim and renee mauborgne, are both prominent professors at insead in fontainebleau, france. To formulate a strategy, companies have to make choices based on an analysis of the internal, external, and. Teaching materials blue ocean pedagogical materials, used in over 2,800 universities and in almost every country in the world, go beyond the standard casebased method. The idea in brief the best way to drive profitable growth. Even though it was created recently, it immediately gained recognition among experts, and presidents and directors of many companies. The concept of ideal strategy and its realization using white ocean. Blue ocean strategy makes companies to come out of ocean of bloody competition by creating market space which is uncontested and that makes the completion irrelevant. Achieved via the delivery of features that have a highest marginal benefit to customer needs. Vol5, issue 4 international journal of management sciences and.
Blue ocean strategy case study service nsw 2 foreword service nsw is an important initiative in the delivery of an improved customer experience for the citizens and businesses of new south wales. Blue ocean strategy ppt presentations on authorstream. Value innovation strategy competes in an uncontested market space. They have seen that the trouble lies in managers mental modelsingrained assumptions and. Blue ocean strategy is a theory explained in a 2005 book by w. Red ocean vs blue ocean structuralist view reconstructionist view key determining factors. Our theory is not to be confused with similarlynamed strategies that deal with environmental impact of business. Blue ocean strategy is a strategy that differs significantly from most business strategies. Blue ocean strategy, blue ocean strategy ppt, business strategy, presentation slides, strategy by. Blue ocean strategy and sustainability for strategic. This blog article is a overview of some of the key points of the book by w. The authors of the bestselling blue ocean strategy have spent over a decade exploring that question. With the necessary resources, blue oceans can be created and recorded successfully. The premise of the book is that companies can succeed by creating.
The risks of following a blue ocean strategy the adaptive. Sep, 2015 this means that the green ocean strategy should be the main strategy of the firm. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. Our multimedia cases and interactive exercises are designed to help you build a deeper understanding of key blue ocean strategy concepts, developed by worldrenowned professors. Blue ocean strategy challenges companies to break out of the red ocean of bloody competition by creating uncontested market space that makes the competition irrelevant.
Insead was founded in 1957 in france and with the opening of its north american office in new york city. Blue ocean strategy is a growth strategy framework focused on the idea of creating an uncontested market spacei. Chan kim and renee mauborgne in their bestselling book of the same name. Blue ocean strategy is a book that was written by w. Insead is committed to developing the next generation of global leaders who will change the world. In red oceans, there is a competitiveadvantage worldview, companies are often driven to outperform rivals and capture greater shares of existing or shrinking market space.
Tools and frameworks for creating and capturing blue oceans it is constructed to create a new value curve and when you apply the four actions framework to the strategy canvas of your industry, you get a. The on the blue ocean strategy essay 1969 words 8 pages. They assert that these strategic moves create a leap in value for the company, its buyers, and its employees while unlocking new demand and making the competition irrelevant. Click here to download the blue ocean strategy summary pdf. They represent businesses that may not be around today, or werent around until they came on to the scene. Blue ocean strategy is a strategy that advice companies to go to a new market, which interest customers and avoid competition from the existing market.
Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. Its authors, insead professors w chan kim and renee mauborgne, continued their steady progress up the thinkers50 list, finishing second to christensen this year. The strategy can transform a current product or idea or create something total new. I was pleased to be a part of a committed team in 2012 bringing service nsw to life, tasked with. Aug 28, 2012 this strategy especially tries to offset this unconscious part in an analytical framework. Grounded in our distinct values, vision and ventures, this 250 million fundraising campaign strives to fortify our academic excellence, drive breakthrough innovation and transform society on a global scale.
Michel porter supports to compete in existing market space, beat the competition, exploit existing demand, make the valuecost tradeoff, align the whole. Various types of strategies are used in strategic management such as red ocean strategy, blue ocean strategy, green ocean strategy, purple ocean strategy. Using blue ocean strategy to reduce new product failure. Blue ocean strategy is innovative, and it creates a new market instead of fitting into the current market. This means that the green ocean strategy should be the main strategy of the firm. Those who want to create a blue ocean strategy for their company must focus on value innovation that makes the competition irrelevant by the simultaneous pursuit of differentiation and low cost, thus creating a leap in value for the customers and an uncontested market space for the company. The norwegian governments ocean strategy regjeringen. Align the whole system of a firms activities in pursuit of differentiation and low cost.
Various types of strategies are used in strategic management such as red ocean strategy, blue ocean strategy, green ocean strategy, purple. Red ocean in blue oceans, demand is created rather than fought over. The green ocean innovation model international journal of. Implement the wom strategy in org anizational problem and ensure optimum solution. While the blue ocean strategy allows a company to pursue a new. Blue ocean strategy generally refers to the creation by a company of a new, uncontested market space that makes competitors irrelevant and that creates new consumer value often while decreasing costs. Blue ocean strategy challenges companies to break out of the red ocean of. In red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are well understood. Chan kim and renee mauborgne, professors at insead. Venture strategies have been used by large multinationals for decades. Blue ocean strategy formulation the four principles of strategy formation click here to read this article. Using bos to create new market space in sustainability. Blue ocean strategy chapter 14 the four action framework chapter two.
There is ample opportunity for growth that is both profitable and rapid. How does blue ocean strategy differ from red ocean strategy. The blue ocean strategy is one of the latest business ideas in the world. Blue ocean strategy blue ocean strategy is a strategic move that organizations or individuals use to create new product or ideas. The innovation management model being discussed for this paper is called the green ocean strategy which is a hybrid theory derived from the more popular theories, blue ocean strategy and red ocean strategy. Core competences are important for the performance and success of the company goddard, 1997. Chan kim and renee mauborgne, two distinguished professors of strategy and management with insead, one of the world.
Since, dividing up existing demand and benchmarking the competitors, blue ocean strategy is regarding grow demand and break away from the competition. The fundamental premise is that most companies fight competitors headtohead in the same space, chasing the same customers with very similar products, creating a bloodyred ocean in their feeding frenzy. See comparison between red and blue ocean strategies here in one simple table. Blue ocean strategy including examples and pdf download. Blue ocean strategy and sustainability for strategic management. So powerful is blue ocean strategy, in fact, that a blue ocean strategic move can create brand equity that lasts for decades. May 30, 2017 it reduced costs by using plastic instead of metal, for example, and reducing the parts in each watch from 150 to 50. Blue ocean strategy is a book published in 2005 and written by w. Blue ocean strategy summary click here to read this article. To formulate a strategy, companies have to make choices based. Blue ocean strategy is a business strategy book, first published on february 3, 2005 by the harvard business school press.
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