It is worth noting the organizations will move between blue oceans and red oceans over time. How to create uncontested market space and make the competition irrelevant kindle edition by kim, w. The following table is useful in highlighting the different focus areas between a red ocean and blue ocean strategy. As market structure is changed by breaking the valuecost tradeoff, so are the rules of the game. The thesis goal is to present the red and blue ocean strategies and give an answer to weather innovation as a tool of blue ocean strategy can help the companies to exit the current. Various types of strategies are used in strategic management such as red ocean strategy, blue ocean strategy, green ocean strategy, purple ocean strategy and black ocean strategy. How to create uncontested market space and make the competition irrelevant, w. It is being published in a recordbreaking 44 languages and is a w. Profitworks is a company built on the values of integrity, hard work, doing things better than they have ever. The following project is a part of our master thesis that we will present for the university of piraeus for the mbatqm master department.
The book titled blue ocean strategy is not helpful to management dont buy it and if you. Based on 15 years of research, the authors used 150 successful strategic moves spanning 120 years of business history and across 30 industries to bring the blue. Before apple launched the iphone there were a number of analysts who predicted apples imminent failure in the handset market, after all, competing with phone manufacturers was not like competing with pc manufacturers handset manufacturers were much more dynamic. Chan kim and renee mauborgne in 2005 from harvard business school. Chan kim and renee mauborgne in their book blue ocean strategy. They research for around over 20 years and sum up a theory of blue ocean.
Blue ocean strategy is a marketing theory and the title of a book published in 2004 that was written by w. How to create uncontested market space and make the competition irrelevant, a. Chan kim and renee mauborgne, published by harvard business school press, boston, massachusetts, 2005, isbn 97815996192. Chapter 1 summary this is the first chapter of blue ocean strategy. The best example of blue ocean strategy that i know of is that of apple launching the iphone. Chan kim is the codirector of the insead blue ocean strategy institute and a chair professor of. Its clear, therefore, that companies which attempt to follow a blue ocean strategy have a much greater chance of success than those which follow a metoo strategy. Download blue ocean strategy pdf including examples. This book brings the best of those articles together all in one place.
Red ocean strategy is a strategy which aims to fight and thrash the competition. The blue ocean strategy book defines red oceans as those which already contain a high level of competition. A red ocean is a metaphor for a market full of competitors. Sep 26, 2016 the strategy canvas provides a highly visual tool to help look at future options. Our aim is to make the formulation and execution of blue ocean strategy as systematic and actionable as competing in the red waters of known market space. The blue ocean strategy book has been sold over 3,5 million times, was published in 43 languages and is a bestseller across five continents. As we see more and more businesses using blue ocean strategies to adapt to changing times, some innovators and trailblazers in education are seeing the light as well. To understand red ocean strategy let us begin by defining blue ocean strategy. Oct 05, 2007 blue ocean strategy executive summary 1. It is a dangerous bad book because it takes some thinking to figure out why it is bad, despite its success, and despite the fact that its key metaphor of blue ocean vs. A strong blue ocean strategy is difficult for other companies to imitate and execute well. Blue ocean strategy is where a company creates a completely new market space or market category.
Reviewing the blue ocean strategy universiteit twente. The concept of ideal strategy and its realization using white. 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. 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 valuecost tradeoff break the valuecost tradeoff align the whole system of a firms activities with its strategic choice of differentiation or low cost. The premise of the book is that companies can succeed by creating. In this article you will learn how to make your competition irrelevant and have sales and profit. You may or may not agree with the central philosophy, but you will be inspired. Furthermore the blue ocean strategy was awarded with. They represent businesses that may not be around today, or werent around until they came on to the scene. 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. Blue ocean strategy chan kim and renee mauborgne was released in 2005 by harvard business school press. A red ocean strategy involves competing in industries that are currently in existence.
Like the blue ocean, it is vast, deep and powerful in terms of opportunity and profitable growth. In a red ocean environment the market becomes more fierce and crowded as. Discussion blue ocean strategy versus red ocean strategy every blue ocean company would ultimately reach to. All in all, blue ocean strategy is a book worth reading. The majority of businesses practice some form of the red ocean strategy. These strategies are called generic strategies and named as survival or black ocean strategy 4, sustainable or green ocean strategy 5, differentiation or red ocean strategy 6, monopoly or. The concept of ideal strategy and its realization using. The chart above summarizes the distinct characteristics of competing in red oceans red ocean strategy versus creating a blue ocean blue ocean strategy.
Sep 24, 2017 blue ocean strategy requires a different mindset. To join the free indie business book club, click here. These strategies are used in organizations by top level executive managers for long term organizational sustainability and to face or deviate from the competition. Blue ocean vs red ocean strategies 6 major differences. Blue ocean strategy is a bad book, but it is not your usual bad book. Red ocean strategy blue ocean strategy compete in exiting market space create uncontested market space beat the competition make the competition irrelevant exploit exiting demand create and capture new demand make the value cost trade off break the value cost trade off align the whole system of a firms. But its not always clear how to create a blue ocean strategy for yourself. Surface 3 and apple watch red oceans v blue oceans strategy. The seminal book blue ocean strategy has sold over 3. Red ocean strategy supports to compete in existing market space, beat the competition, exploit existing demand, make the valuecost tradeoff, align the whole system of a companys activities with its strategic choice of differentiation or low cost porter m.
There is ample opportunity for growth that is both profitable and rapid. Chan kim and renee mauborgne, professors at insead and codirectors of the insead blue ocean strategy institute. May 30, 2017 to join the free indie business book club, click here. Blue ocean strategy is based on over decadelong study of more than 150 strategic moves spanning more than 30 industries over 100 years. Blue ocean vs red ocean strategies 6 major differences red bull case study published on june 2, 2016 june 2, 2016 92 likes 5 comments. Alltoooften, educators are slow to adopt new ideas from business and apply them to academia but here is one story we especially would like to share with you.
Over 4 million copies sold wall street journal and businessweek bestseller recognized as one of the most iconic and impactful strategy books ever written the global phenomenon that has sold over 4 million copies, is published in a recordbreaking 46 languages and is a bestseller across five continentsnow updated and expanded with new content. In this 5 minute blog, ill tell you what the difference is between a red ocean vs blue ocean and how you can survive a red ocean and swim into a more profitable and audible blue one. Chan kim and renee mauborgne in the indie business book club. Companies should instead look for new market space and ways to reinvent the industry.
The database and research have continued to expand. Executing a blue ocean strategy in the following chapter i will explain the concepts that have been used. Discussion blue ocean strategy versus red ocean strategy every blue ocean company would ultimately reach to the level of red ocean category as. By deviating from typical value curves, a blue ocean strategy doesnt make sense.
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. Blue ocean strategy red ocean strategy blue ocean strategy compete in existing market space. Based on an eponymously titled book, this strategy argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Blue ocean strategy is a theory explained in a 2005 book by w. Successful trailblazing organizations will attract competition, creating a red ocean.
Only then can companies step up to the challenge of creating blue oceans in a smart and. Mar 10, 2015 back in 2008, i wrote a paper on blue ocean strategy which was published at the international conference on management. As we begin our dive into the blue ocean strategy, it is important to understand what most businesses do, and why it doesnt work. It became a huge bestseller, and remains popular today. Apr 21, 2009 the red ocean is where every industry is today. The strategy canvas provides a highly visual tool to help look at future options. Innovation, new market space and creating demand are central characteristics. Blue ocean strategy chapter 14 the four action framework chapter two. Achieved via the delivery of features that have a highest marginal benefit to customer needs.
How to create uncontested market space and make the competition irrelevant by w. Let us say the market that we operate is an ocean cle. 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. This blog article is a overview of some of the key points of the book by w. 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. Blue ocean streagety chapter 1 chapter1summary this is. Red ocean in blue oceans, demand is created rather than fought over. Back in 2008, i wrote a paper on blue ocean strategy which was published at the international conference on management. This often requires overcoming an intense level of competition and can often involve the commoditization of the industry where companies are competing mainly on price. For this strategy, the key goals are to beat the competition and exploit existing demand. Chan kim and renee mauborgne 2006 blue ocean strategy has been described as a must read for all business students.
An introduction to blue ocean strategy mba knowledge base. Although there is an inevitability to having to compete in crowded markets, there are too many advantages to avoiding this situation to ignore the possibility of looking for blue space. 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 blue oceans and to do so in a way that people own and drive the process. Red ocean strategy pdf download download the blue ocean strategy summary pdf. In red ocean companies try to surpass their rivals to take hold of a greater share of existing demand. 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. How to create uncontested market space and make the competition irrelevant, a book by professors w. 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.
Blue ocean strategy including examples and pdf download. Jul 28, 2018 blue ocean strategy was coined by professors w. Yet that 14percent generated 38percent of total revenues and 61percent of total profits. Chan kim and renee mauborgne, professors at insead. Value innovation strategy competes in an uncontested market space. History and background a video game console is just a computer that is made only. Chan kim and renee mauborgne are professors of strategy at insead and codirectors of the insead blue ocean strategy institute. Instead of dividing up existingand often shrinkingdemand and benchmarking competitors, blue ocean strategy is about growing demand and breaking away from the competition. These systems started to gain popularity in the 1970s with consoles that played only pong. An analytical study of red ocean and blue ocean strategy. The researchers called this the red ocean, analogous to a shark infested ocean where. Blue ocean strategy can be found on amazon blue ocean strategy. In the decade since the publication of the first edition of our book, blue ocean strategy, weve had conversations with many managers involved in executing marketcreating strategies.
Blue ocean strategy is a book published in 2005 and written by w. The following behaviors are amplified by blue ocean strategies that deviate from the status quo. They are the authors of blue ocean strategy, which has sold over 3. Based on 15 years of research, the authors used 150 successful strategic moves spanning 120 years of business history and across 30 industries to. Red oceans represents all the industries in existence read little women online pdf today. The risks of following a blue ocean strategy the adaptive. 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. Type of strategy details 1 red ocean strategy red ocean strategy supports to compete in existing market space, beat the competition, exploit existing demand, make the valuecost tradeoff, align the whole system of a companys activities with its strategic choice of differentiation or low cost. Blue ocean strategy and blue ocean shift, created by worldrenowned professors chan kim and renee mauborgne, is a new way of thinking, a movement away from a. The researchers called this the red ocean, analogous to a shark infested ocean where the sharks are fighting each other for the same prey. 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.
There is a defined market, defined competitors and a typical way to run a business in any specific industry. The fundamental premise is that most companies fight competitors headtohead in the same space, chasing the same customers with very similar products, creating a bloody red ocean in their feeding frenzy. It is either when businesses enter an oversaturated marketplace, or they simply defend. Red ocean strategy blue ocean strategy compete in exiting market space create uncontested market. Michel porter supports to compete in existing market space, beat the competition, exploit existing demand, make the valuecost tradeoff, align the whole. Of the many strategic planning models that exist, the blue ocean strategy could be considered the pacifist of the group. Chan kim and renee mauborgne have created a comprehensive set of analytic tools and frameworks to create blue oceans of new market space. Blue ocean strategy is a powerful framework for finding new business opportunities. Jun 02, 2016 blue ocean vs red ocean strategies 6 major differences red bull case study published on june 2, 2016 june 2, 2016 92 likes 5 comments.