Blue Ocean Strategy by Chan Kim
Blue Ocean Strategy is actually a business strategy book which is written by W. Chan Kim and Renee Mauborgne in 2005. This book explains how any organisation can achieve high growth and profits by creating new demand in the market or a “Blue Ocean”. According to it, it is very difficult to compete with the existing organisations in the existing market.
The book is mainly consisted of three parts:
The first represents the key element of the blue ocean strategy. It includes value innovation and analytical tools and frameworks like strategy canvas, four actions of framework.
The second part includes four principles of Blue Ocean Strategy. They are:- How to create uncontested market by reconstructing new market boundaries, focusing on big pictures, reaching beyond the demands and getting the right strategic sequence?
The third and fourth part represents basic implementation principle of Blue Ocean. The implementation methods are of great importance for the organisation.
Basic concept:
The Blue Ocean, mainly represents all the industries which does not exist in today’s market. In this strategy, the demand is created for the particular product rather than fighting with the existing companies. So, there is no competition because the rules are set later.
The main or central element of Blue Ocean is “Value Innovation”. The value innovation creates the value at the same time for both the company and the buyers. A Blue Ocean is created only when the company achieves the value innovation. The innovation should raise or create values for market as well as at the same time reduces the services which are less used by the market.
Also, the Blue Ocean strategy is considered better than the competition based strategies. The competition based strategies includes competition with the other existing companies rather than focusing on the increase in the demand for product. So, the competition based strategies are not good to attain high performance.
Written by: Matt Mason
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Tagged as blue ocean strategy, business strategy, competition based strategies, Renee Mauborgne, value innovation, W. Chan Kim + Categorized as Economy articles, Other, Management, Other, Marketing