Identify the three tiers of noncustomers in your industry. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. The cornerstone of the blue ocean strategy is value innovation. In their 2017 new york times bestselling book, blue ocean shift, kim and mauborgne share how to put these practical marketcreating tools into practice to move from red to. This case illustrates that if companies wish to tap into latent demand and create organic growth, they must learn from non customers. It is being published in a recordbreaking 44 languages and is a w. Chan kim is the codirector of the insead blue ocean strategy institute and a chair professor of. With a focus of not just beating your competition but making them irrelevant, blue ocean strategy is all about thinking outside the box. Its a market strategy, with a whole new thinking that will attract a new group of customers that were traditionally non customers. Intelligent readers dont need help figuring that out. Drawing on more than a decade of new work, kim and mauborgne show you how to move beyond competing, inspire. Blue ocean strategy is a business strategy book, first published on february 3, 2005 by the.
The creation of blue oceans is about driving costs down while simultaneously driving value up for buyers. How can you bring the three es to your company its important to understand these two blue ocean strategy principles one is the concept of non customers. Blue ocean strategy is a customer led strategy focusing on existing customers. Chan kim and renee mauborgne are both professors of strategy at insead, as well as codirectors of the insead blue ocean strategy institute. Blue ocean strategy is based on the idea that every enterprise can achieve higher profit by creating new demand in non competitive market so called blue ocean. These are buyers who have seen your industrys offerings as an option to fulfill their needs but have voted against them. May, 2014 the blue ocean strategy is all about challenging the industry focus. Jan 28, 2018 a fivestep process to achieve blue ocean strategy. May 30, 2017 a blue ocean is contrasted with a red ocean where all market participants are doing the same thing and fighting for the same customers. Now we turn from current customers to noncustomers. 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. The blue ocean strategy is all about challenging the industry focus.
Some equate it to the work we find in peter thiels zero to one. The main selling point with blue ocean marketing is the focus on creating demand where there currently is none. Value innovation value innovation places equal emphasis on value and innovation. The blue ocean strategy seems to be a perfect solution for present companies to become sustainable successful. Thirdly competition the fact that sooner or later someone will copy or even improve your already successful model, due to the certainty that a company cannot really create blue oceans, they will always be.
The research focused on discovering the common factors that lead to the creation of blue oceans and the key differences that separate those winners from the mere survivors and those adrift in the red ocean. I love when i listen to the little voice and the result is a lifechanging nugget. I recently read this management book titled, blue ocean strategy that highlighted one key observation. Your goal is to avoid being in the sharkinfested, bloody waters and instead find your own calm and quiet blue ocean. Chan kim and renee mauborgne, professors at insead. This blog article is a overview of some of the key points of the book by w. That is a fine book and an extension of blue ocean thinking. Tilt challenges us to place customers at the heart of strategy.
Non customers who refuse to use your industrys offerings. Why churches need blueocean strategies biblical leadership. Jun 21, 2007 blue ocean strategy red ocean strategy 2. With product cycles shortening and product costs shrinking, this book brings to life a deeper understanding of how strategy can be made more powerful. The best book for noncompetitive strategy striving. Blue ocean strategy is a book published in 2005 and written by w. Chan kim and renee mauborgne 2006 blue ocean strategy has been described as a must read for all business students. 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. Achieved via the delivery of features that have a highest marginal benefit to customer needs.
The blue ocean strategy as a method for developing sustainable profitable frameworks implies the fundamental idea of developing new innovational markets with a majority of new customers. May 17, 2019 blue ocean strategy is, itself, a blue ocean in the strategy world. Jan 20, 2015 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. How to create an uncontested market space and make the competition irrelevant, harvard business school publishing, 2005. Chan kim and renee mauborgne are professors of strategy at insead and codirectors of the insead blue ocean strategy institute. Blue ocean strategy formulation the strategy canvas. Beyond competing proven steps to inspire confidence and seize new growth by w. You are uncontested because you have created a product or service that is exclusive and unchallenged.
How to develop a blue ocean strategy with customer instinct. The blue ocean strategy tiers of non customers bosco. A blue ocean strategy differs from a lowcost strategy in that a. The blue ocean approach asks whether its possible to change the value curve and focus on non customers. In this article you will learn how to make your competition irrelevant and have sales and profit. This can take different forms but the three tiers of non customers diagram below helps to reflect. The basic idea is that by identifying differentiated valuedrivers from the existing competition in the market, a company is able to create innovation that delivers significantly increased value at a lower. Lasting success for a company means customers arent confusing your business with your competitors who have similar products and structures to your own. Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w.
Blue ocean strategy including examples and pdf download. 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. Public sector application and research, including the application of blue ocean shift, blue ocean strategy, and blue ocean leadership to governments and non profits. This can be done by creating more value for buyers enabling the company to open up a whole new uncontested market space, the blue ocean. Value innovation strategy competes in an uncontested market space. The premise of the book is that companies can succeed by creating. Making a blue ocean shift is about creating new demand and growing your industry, rather than competing for existing customers. A landmark work that upends traditional thinking about strategy, this bestselling business book charts a bold new path to winning the future. Jul, 2018 for struggling businesses, mauborgne recommended the strategy canvas, which is featured in her and kims newest book, blue ocean shift.
Four reasons why blue ocean thinking is crucial insead. We are swimming in a very large ocean with a lot of unexplored waters of non customers. A lot has been written about it and i would have said practically everything had been said about it until i looked up the book on amazon to see the current price. Chan kim is the codirector of the insead blue ocean strategy institute and a chair professor of strategy and international management at insead. A blue ocean is contrasted with a red ocean where all market participants are doing the same thing and fighting for the same customers. In blue ocean strategy, big ideas are formed when you look beyond your customers to think about your non customers. This is exactly what the authors of blue ocean strategy argue. Blue ocean strategy is a theory explained in a 2005 book by w. Social sector application and research, including such topics as how blue ocean strategy can be applied in the developing world to mitigate poverty and improve education and health. Blue ocean strategy three tiers of noncustomers forum. One of the first steps of the blue ocean shift process is to identify the demand that exists beyond your industry.
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. Blue ocean strategy argues that tomorrows leading companies will succeed not by battling competitors, but by creating blue oceans of uncontested market space, where competition is rendered irrelevant of companies that made competition irrelevant in their industries to elicit the strategic logic behind blue ocean strategy. Rather than concentrating on beating the competitors, the company must actually prioritize on making the competition irrelevant. The database and research have continued to expand. Blue ocean strategy written by insead professors w. Reviewing the blue ocean strategy universiteit twente. Blue ocean strategy is, itself, a blue ocean in the strategy world.
Blue ocean strategy is the 2015 update to the classic business strategy text of the same name originally published in 2005. The strategy canvas outlined in the book is basically a tool to visually show how a company will or has created a blue ocean strategy. This blue ocean strategy and shift addresses exactly where i am. The case demonstrates that if nintendo attempted to compete headtohead against its sony and microsoft rivals they would be further marginalized in the game console industry. A blue ocean, as used in the title of this book and strategy, is basically uncharted territory in the business world. In a blue ocean, you are the only provider of consequence. Some of the material in this article will appear in a different form in my forthcoming book, the age. The risks of following a blue ocean strategy the adaptive. It is being published in a recordbreaking 44 languages and is a bestseller across five. To convert this huge latent demand into real demand in the form of thriving new customers, companies need to deepen their understanding of the universe of noncustomers. They are the authors of blue ocean strategy, which has sold over 3. Blue oceans are about exploring noncustomers and creating new. Blue ocean strategy ends with ten cognitive traps that can deter you from creating blue oceans or that jeopardize your execution. These will be phrased as myths that are then debunked.
Some of the material in this article will appear in a. 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. It is used to plot how the current competitors compete in a market space, what factors they compete on and how your company and the competition scores on each key factor. 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. Take a look at this comparison between the two strategies published by sage growth partners. Value innovation is a new way of thinking about and executing strategy that results in the creation of a blue ocean. Kim and mauborgnes four actions the strategy book, 2nd. Chan kim is an awesome and eyeopening book about moving from red to blue ocean industry.
Lead differently for a different workforce longitudes. The profit is much easier than the rivalry with the competition on existing markets. I can now incorporate the blue ocean strategy and shift in my process. Although the universe of noncustomers typically offers big blue ocean opportunities, few companies have keen insight into who noncustomers are and how to unlock them. Blue ocean strategy is a method of creating business strategy of the enterprise, which was described in a book by w. They are the authors of the new york times and wall street journal bestseller blue ocean shift. When companies are willing to challenge the functional emotional orientation of their industry, they often find new market space. You are uncontested because you have created a product or service that is. Blue vs red ocean endicott masters in international admin. Blue ocean strategy is based on over decadelong study of more than 150 strategic moves spanning more than 30 industries over 100 years. How to create uncontested market space and make the competition irrelevant by w. Creation of a blue ocean market space is about creating new demand and attracting non customers instead of creating new customers. His book blue ocean strategy, coauthored with renee mauborgne, has sold 3. The top 15 strategic management books startup grind.
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