The bestselling book blue ocean strategy uses the analogy of a red ocean to represent a market environment in which companies fiercely compete. Chan kim and renee mauborgne in the indie business book club. Blue ocean strategy presents a systematic approach to making the competition irrelevant and outlines principles and tools any company can use to create and capture their own blue oceans. Blue oceans, where a market space is new and uncontested, and strategy centers around value innovation. Blue ocean strategy is a method of creating business strategy of the enterprise, which was described in a book by w. Blue ocean strategy is the most successful book on business masterplanning. Blue ocean strategy can be applied across sectors or businesses. Because value to buyers comes from the offerings utility minus. Qantas the australian way praise for blue ocean strategy. The graphic below done with the following blue ocean excel template illustrates nintendos wii strategy and is almost selfexplanatory. In order to create this shift in attention from red oceans to blue oceans the authors came up with a concept called value innovation that allows for a simultaneous pursuit. Learn about the each and how to choose a strategy that will lead to business growth.
We often tell our clients that if they need to reignite their business or change their market strategy or create a new business model, they should have a crisis or create one. Most markets are crowded with metoo companies fighting each other with cutthroat discounts and special offers. Blue ocean strategy is ideal for consumer products. Chan kim and renee mauborgne in their book blue ocean.
Aim of this dissertation is to investigate whether eataly, the largest wine and food marketplace of the world, entered a blue ocean via business model innovation. The book the origin of the terms red and blue oceans comes from blue ocean strategy how to create uncontested market space and make the competition irrelevant. Business model innovation and digital strategy fourweekmba. Instead, you are trying to achieve great things on a large scale. Value innovation is the simultaneous pursuit of differentiation and low cost, creating a leap in value for both buyers and the company. May 30, 2017 t his month, we read blue ocean strategy by w. This automotive industry case study highlights the common pattern underlying successful blue ocean strategic moves. They create new, uncontested market space through what the authors call value innovation. A guide to defining value propositions and target customers for commerc. You arent just trying to scrape by when you use this kind of strategy in your business.
The insead blue ocean strategy institute is dedicated to extending the research on blue ocean shift, blue ocean strategy, and blue ocean leadership by chan kim and renee mauborgne and disseminating it to professors, researchers and practitioners around the globe. This is a highly influential and important book in the field of innovation and business strategy. What is blue ocean strategy about blue ocean strategy. A blue ocean strategy adopts the belief that markets and industries are not structured to beget competition. Business model canvas coupled with the blue ocean strategy provides a very. Here is the book descriptions extracted from amazon. It is getting a business to this crucial state that the book focuses on. By defining and seeing examples of the blue ocean strategy, your organization can learn how to execute on this strategic planning model. A different kind of business world calls for a different kind of business manual, and thats what alex osterwalder and yves pigneur have achieved in their new age guide to contemporary business modeling. One of the most successful efforts to do so is the book blue ocean strategy, by.
For each model, they demonstrate the content, context, and application, using clear and eyecatching graphics. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. Chan kim and renee mauborgne and is the cornerstone of marketcreating strategy. But, lets first understand what is blue ocean and how it is different from red ocean strategy. May 03, 2017 blue ocean strategy, create new markets and leave the competition behind renee mauborgne wobi duration. Jul 16, 2015 in this article, we will look at 1 what is a blue ocean strategy. How to create uncontested market space and the make. It is a roadmap to move you, your team, and your organization to new heights of confidence, market creation and growth. This creates a new product offering that doesnt currently exist.
The logic behind blue ocean strategy is counterintuitive. Achieved via the delivery of features that have a highest marginal benefit to customer needs. Abetted by their business model innovation hub with 470 online collaborators in 45 countries osterwalder. So great was the blue ocean ford created that the model t replaced the horsedrawn carriage as the primary means of transport in the united states. It can be intimidating to approach your business from this big picture perspective.
A business model differes from a business strategy. It takes its name form the metaphor of a sea in which many sharks are circling, competing with each other and occasionally thrashing around fighting over food creating a swirling. Chan kim and renee mauborgne, develops and explains how to beat the competition by reaching beyond it into new unexplored markets. Where red ocean strategy is a zerosum game that is all about splitting up the pie between rivals, blue ocean strategy is about creating the pie andor enlarging it. Therefore, value innovation looks slightly different in a blue ocean model. Feb 03, 2015 blue ocean strategy is a mustread for any aspiring entrepreneur or business marketerif you know someone who is trying to start their own business and is still trying to figure out where to start, this book has the potential to be an absolutely transformational gift for them. They provided a powerful framework for questioning incumbent business models. The book presents analytical frameworks and tools to foster an organizations ability to systematically create and capture blue oceansunexplored new market. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was.
The authors use the metaphor of the blue ocean as a direct contrast to red oceans. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. Yet, the business model canvas is just the beginning. Business strategy is all about how you intend to differentiate yourself from the competition and how you plan to get there. Value innovation strategy competes in an uncontested market space. Pdf business model canvas innovation and blue ocean strategy.
What is the blue ocean strategy the term blue ocean was coined by two professors w. Blue ocean strategy and new business models in the food industry. Blue ocean strategy is based on the idea that every enterprise can achieve higher profit by creating new demand in noncompetitive market so called blue ocean. The blue ocean strategy explains how to guide your business across seas with less competition and greater profitability. While this came in appendix a in the book, this is a good time to cover three industries with repeated blue ocean creation. The economist a great read for any leader looking to get a real edge in business and establish a real competitive advantage in the market. Sep 24, 2017 blue ocean strategy requires a different mindset. How to create uncontested market space and make the competition irrelevant, w. Instead of fighting headon with your competitors, how do you create uncontested market space and make the competition totally irrelevant. This allows them to build a viable business model and ensure that a company profits. Made by group d of the minor global trendwatching 2015. The fourweekmba is your go to source of business insights. Blue ocean strategy is the most successful book on business masterplanning the economist a great read for any leader looking to get a real edge in business and establish a real competitive advantage in the market. The landscape of strategy is full of many models of innovation.
Summary of the first four chapters of the international bestseller blue ocean strategy. This strategy revolves around searching for a business in which very few firms operate and where there is no pricing pressure. On blue ocean strategy by kim and mauborgne the business model canvas is a perfect extension of the analytical tools presented by kim and mauborgne. The leading source of insights on business models, business model strategy and innovation. Blue ocean is a slang term for the uncontested market space for an unknown industry or innovation. The blue ocean strategy is a business book that has become mandatory for modern managers by proposing an organized structure to identify and implement differentiation in any industry and help you grow your business faster. Get the key points from this book in less than 10 minutes. Blue ocean strategy this is the name given to a technique for exploring innovation space originally developed by two professors at the business school insead. This is a focus on generating additional demand rather than improving or increasing supply through value innovation. The premise of blue ocean strategy is, as stated on page 4, red oceans represent all the industries in existence today. In this article, we will look at 1 what is a blue ocean strategy.
Chan kim and renee mauborgne in their book titled blue ocean strategy. May 26, 2015 summary of the first four chapters of the international bestseller blue ocean strategy. Value innovation the key to blue ocean strategy the. Recognized as one of the most iconic and impactful strategy books ever written, blue ocean strategy argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Its authors, insead professors w chan kim and renee mauborgne, continued their steady progress up the thinkers50 list, finishing second to christensen this year. Blue ocean strategy, expanded edition book depository. One of the most successful efforts to do so is the book blue ocean strategy, by w. The bestselling book blue ocean strategy uses the analogy of a red ocean to represent a market environment in which. This process helps refine ideas and identify opportunities with the most potential, minimizing risk.
Disruptive innovation and blue ocean strategy trustedpeer. How to create uncontested market space and make the competition irrelevant, a book by professors w. Unlike the red ocean strategy, the conventional approach to business of. That might mean focusing more on innovation, competition, or another key concept. In short, you create a blue ocean by focusing on the factors that customers really care about, while discarding factors they dont. The blue ocean strategy allows business owners to think big. After all, which firm would not to be operating in. Blue ocean strategy is the bestselling book which created a worldwide revolution in business strategy. Blue ocean strategy and new business models in the food.
The blue ocean idea index is part of the overarching strategy and lets companies test the commercial viability of ideas. Mar 16, 2015 today, we tell you something about an interesting chaper in osterwalders book about the blue ocean strategy. Based on a study of 150 strategic moves spanning more than 100 years and 30 industries, blue ocean strategy addresses this question and provides a systematic approach to drafting and implementing your own blue ocean strategy. A landmark work that upends traditional thinking about strategy, this bestselling business book charts a bold new path to winning the future. This allows them to build a viable business model and ensure that a company profits from the blue ocean it is creating. Its a methodology that helps companies identify highpotential areas for innovation. This prompts companies to be innovative with their products. The first part presents key concepts of blue ocean strategy, including value innovation the simultaneous pursuit of differentiation and low cost and key analytical tools and frameworks. Blue ocean strategy business model blue ocean tools and. In red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known.
Today, we tell you something about an interesting chaper in osterwalders book about the blue ocean strategy. While the book is aimed primarily at large, traditional businesses, our book club members managed to scale some of the advice to fit our needs. Chan kim and renee mauborgne, professors at insead. Strategyzer aspires to create a whole new generation of business tools that change the way organizations do strategy and innovation. They are the authors of the new york times and wall street journal bestseller blue ocean shift. Blue ocean strategy value innovation strategy canvas four actions. Blue ocean challenges companies to push the boundaries of their industries and offer consumers something unique of immense value. Companies need to build their blue ocean strategy in the sequence of buyer utility, price, cost, and adoption. Chan kim and renee mauborgne, launched a revolution in business strategy. The first part presents key concepts of blue ocean strategy, including value innovation the simultaneous pursuit of differentiation and low cost and key analytical tools and frameworks such as the strategy canvas and the four actions framework. By defining and seeing examples of the blue ocean strategy, your organization can learn how to execute on this strategic planning model and successfully reconstruct your market. Porters model looks at specific factors that help determine whether a business can be profitable based on other businesses in the industry.
Apr 01, 2009 value innovation the key to blue ocean strategy value innovation is the cornerstone of blue ocean strategy and is created through a series of strategic moves resulting in a product or service substantially different from any other offering. Pay attention to a trend or problem, investigate it and see if you can blue ocean strategy your way to. Sequence of blue ocean strategy companies need to build their blue ocean strategy in the sequence of buyer utility, price, cost, and adoption. Blue ocean strategy is the 2015 update to the classic business strategy text of the same name originally published in 2005. Red oceans are described as all the industries in existence today. In the book business model generation the author has proposed to. The text offers a practical handbook to business students and entrepreneurs who wish to rise above the fray of the competition, become pioneers in previously uncharted market territory, and gain access to impressive growth opportunities and an untapped customer base. 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. The combination of these two make sure that innovation is not just.
In strategic decisions, planellas and muni accurately and succinctly summarize thirty of the most widely used strategic models, including porters five forces, maubourne and kims blue ocean strategy, and chesbroughs open innovation. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. We are excited to share this knowledge with you and highlight some best practices. Why the business model canvas complements blues ocean strategy author. The following is our best of the best innovation book reading list the top recommended books on the topics of business innovation, new product innovation, new service innovation, business model innovation, strategic thinking, organizational culture and innovation, and business creativity. It presents a systematic approach to making the competition irrelevant and outlines principles and tools any organization can use to create and capture their own blue oceans.
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