...COLOURS WHAT IS PINK? A ROSE IS PINK BY THE FOUNTAIN’S BRINK. WHAT IS RED? A POPPY’S RED IN IT’S BARLEY BED. WHAT IS BLUE? THE SKY IS BLUE WHERE THE CLOUD FLOAT THROUGH. WHAT IS WHITE? A SWAN IS WHTTE SAILING IN THE LIGHT . WHAT IS GREEN? THE GRASS IS GREEN WITH SMALL FLOWERS BETWEEN. WHAT IS VIOLET? CLOUDS ARE VIOLET IN THE SUMMER TWILIGHT . WHAT IS ORANGE? WHY, AN ORANGE, JUST AN ORANGE! -CHRISTINA ROSSETTI- FLINT AN EMERALD IS AS GREEN AS GARSS, A RUBY RED AS BLOOD; A SAPPHIRE SHINES AS BLUE AS HEAVEN; A FLINT LIES IN THE MUD. A DIAMOND IS A BRILLIANT STONE, TO CATCH THE WORLD’S DESIRE; AN OPAL HOLDS A FIERY SPARK; BUT FLINT HOLDS FIRE. -CHRISTINA ROSSETTI- THE WORKS OF GOD ALL THINGS BRIGHT AND BEAUTIFUL, ALL CREATURES GREAT AND SMALL, ALL THINGS WISE AND WONDERFUL- THE GOOD GOD MADE THEM ALL. EACH LITTLE FLOWER THAT OPENS, EACH LITTLE BIRD THAT SINGS- HE MADE THEIR GLOWING COLOURS, HE MADE THEIR TINY WINGS. THE PURPLE-HEADED MOUNTAIN, THE RIVER RUNNING BY, THE MORNING AND THE SUNSET THAT BRIGHTEN UP THE SKY; THE TALL TREES IN THE GREENWOOD, THE PLEASANT SUMMER SUN, THE RIPE FRUITS IN THE GARDEN- HE MADE THEM EVERYONE. HE GAVE US EYES TO SEE THEM, AND LIPS THAT WE MIGHT TELL, HOW GREAT IS GOD ALMIGHTY, WHO HAS MADE ALL THINGS WELL. -C.F. ALEXANDER- THE WORLD IS MINE ...
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...LITERATURE REVIEW BLUE OCEAN STRATEGY BY W. CHAN KIM AND RENÉE MAUBORGNE Mirko Hagendorf AGENDA I. Introduction of authors II. The Blue Ocean Strategy Definitions of Red and Blue Oceans Characteristics Summary Success and examples III. Critical reflection of the strategy IV. Discussion and questions 2 I. INTRODUCTION OF AUTHORS W. Chan Kim & Renée Mauborgne Work together at INSEAD (Institut Européen d´Administration des Affair, France) Both as Co‐Director of “INSEAD Blue Ocean Strategy Institute” Kim: Bruce D. Henderson Chair Professor of Boston Consulting Group for Strategy and International Management Mauborgne: Professor for Strategy Member of President Barack Obama’s Board of Advisors Ranked No. 2 in The Thinkers50 listing of the World’s Top Management Gurus 3 II. THE BLUE OCEAN STRATEGY DEFINITION Red Ocean “represent all the industries in existence today ‒ the known market space (…) [where] companies try to outperform their rivals in order to grab a greater share of existing demand.” • Roots in military thinking on strategy • “Structuralist view” or “environmental determinism” • Situation in many industries lead to shrunk profit margins 4 II. THE BLUE OCEAN STRATEGY DEFINITION Blue Ocean “denote all the industries not in existence today (…) [where] , demand is created rather than fought over.” • “reconstructionist view” • Creation ‐ “give rise to completely new industries” ...
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...Blue Ocean Strategy Executive Summary The Harvard Business Review “Blue Ocean Strategy” by W. Chan Kim and Renee describes the “business universe” and its two “distinct kinds of space,” the red ocean and the blue ocean. The article explains how the market space if divided by these two oceans. The red ocean symbolizes the industries that are currently in present in the market. These industries serve as models for current competitors as well as future ones. On the other side, blue oceans are industries that are “not in existence today.” These industries are unknown and could be developed from red oceans or from completely new industries. The main difference between these two types of markets is the customer demand. Red oceans have fixed demand and competitors constantly compete against each other for consumers’ acceptance and attention. Blue oceans create a demand that did not existed before, generating greater opportunities for growth. Although the concept of red and blue oceans might be new for many, it has existed since the moment industries were created. In summary, red oceans are existing industries and blue oceans are unknown industries. When we look back, we realize that all industries that seem essential for daily tasks were once unknown. Long time ago, the pool of industries that conformed the red ocean was not as immense as it is today. As blue industries were introduced, the red ocean became larger. As of today, the Standard Industrial Classification (SIC) has been...
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...Blue Ocean Strategy Summary by Jay Robinson Source: Blue Ocean Strategy by W. Chan Kim & Renée Mauborgne Red Ocean: Companies compete for customers Chapter 1 Blue Ocean: Company creates new market Chapter 1 Value Innovation Decrease costs GOAL Increase value to consumer Chapter 2 Analytical Tools and Frameworks • Strategy Canvas • Four Actions Framework • Eliminate-Reduce-Raise-Create Grid 3 Characteristics of Blue Ocean Strategy 1. Focus 2. Divergence 3. Compelling Tag line Chapter 2 Strategy Canvas V a l u e Variables Chapter 2 Four Actions Framework Reduce factors below the standard Eliminate factors taken for granted New Value Curve Create factors never before offered Raise factors well below the standard Chapter 2 Eliminate-Reduce-Raise-Create Eliminate Raise • • • Reduce • • • Create • • • Chapter 2 • • • Reconstruct Market Boundaries Look Across Alternative Industries Look Across Strategic Groups Within Industries Look Across the Chain of Buyers Look Across Complementary Product and Service Offerings Look Across Functional or Emotional Appeal to Buyers Look Across Time Chapter 3 Visualize Strategy Visual Awakening; See where you are Visual Exploration; See how others see you Visual Strategy Fair; See where you could be Visual Communication; Draw a Map for everyone (Pioneer-Migrator-Settler Map) Chapter 4 3 Tiers of Noncustomers 3rd Tier 2nd Tier 1st Tier Your Market Chapter...
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...Blue Ocean Strategy Paper The Harvard Business Review “Blue Ocean Strategy” by W. Chan Kim and Renee describes the “business universe” and its two “distinct kinds of space,” the red ocean and the blue ocean. The article explains how the market space if divided by these two oceans. The red ocean symbolizes the industries that are currently in present in the market. These industries serve as models for current competitors as well as future ones. On the other side, blue oceans are industries that are “not in existence today.” These industries are unknown and could be developed from red oceans or from completely new industries. The main difference between these two types of markets is the customer demand. Red oceans have fixed demand and competitors constantly compete against each other for consumers’ acceptance and attention. Blue oceans create a demand that did not existed before, generating greater opportunities for growth. Although the concept of red and blue oceans might be new for many, it has existed since the moment industries were created. In summary, red oceans are existing industries and blue oceans are unknown industries. When we look back, we realize that all industries that seem essential for daily tasks were once unknown. Long time ago, the pool of industries that conformed the red ocean was not as immense as it is today. As blue industries were introduced, the red ocean became larger. As of today, the Standard Industrial Classification (SIC) has been...
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...Blue Ocean Strategy: Article Summary Abstract The Blue Ocean Strategy (BOS) is a business strategy about capturing uncontested market space, thereby making competition irrelevant. The corner-stone of BOS is 'Value Innovation'. A blue ocean is created when a company achieves value innovation that creates value simultaneously for both the buyer and the company. The innovation (in product, service, or delivery) must raise and create value for the market, while simultaneously reducing or eliminating features or services that are less valued by the current or future market. The "ocean" in the title refers to the market or industry: • Blue Oceans are untapped and uncontested market, which provides little or no competition for anyone who would dive in, since the market is not crowded. • Red Oceans, on the other hand, refers to a saturated market where there are fierce competitions, already crowded with companies providing the same type of services, producing the same kind of goods. The idea is to do something different from everyone else, produce something that no one has yet seen, thereby creating a blue ocean. Blue Ocean Strategy: Article Summary BOS explains that rather than competing within the confines of existing industry or trying to steal customers from rivals (Red Ocean Strategy), uncontested market space should be developed that makes competition irrelevant. Red oceans are all the industries in existence today—the known market space. In the red...
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...Blue Ocean Strategy Paper 01/05/15 MKT/421 Blue Ocean Strategy – Introduction When a company is about to enter the market, they typically spend their time trying to create a strategy to overcome their competitors that already exist in the market. In the book Blue Ocean Strategy authors W. Chan Kim and Renée Maugorgne explain how to create your own blue ocean. A blue ocean is the complete opposite of the existing red oceans in the market that quickly drown a new company before they can gain success. Basing their studies on 150 strategic business moves that stretch over 300 years and 30 different industries. Kim and Mauborgne express the importance of 6 principles a company needs in order to create their own blue ocean. The six principles show how to reconstruct market boundaries, focus on the big picture, reach beyond existing demand, get the strategic sequence right, overcome organizational hurdles, and build execution into strategy (Blue Ocean Strategy, 2014). What is Blue Ocean Strategy in Marketing? The Blue Ocean Strategy is essentially creating your own unique market where you have absolutely no competitors therefore creating your own demand from consumers. This strategy is important because it has been proven to be wildly successful and is trending in all types of industries, meaning this strategy isn’t going away and it is a proven strategy, especially in the ever changing and expanding tech industry. In a ‘blue ocean’ a company doesn’t need strategize on...
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...A Short Summary of ‘Blue Ocean Strategy’ By: W. Chan Kim and Renée Mauborgne Red Oceans are all the industries in existence today—the known market space. In the red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. Here companies try to outperform their rivals to grab a greater share of product or service demand. As the market space gets crowded, prospects for profits and growth are reduced. Products become commodities or niche, and cutthroat competition turns the ocean bloody. Hence, the term red oceans. Blue oceans, in contrast, denote all the industries not in existence today—the unknown market space, untainted by competition. In blue oceans, demand is created rather than fought over. There is ample opportunity for growth that is both profitable and rapid. In blue oceans, competition is irrelevant because the rules of the game are waiting to be set. Blue ocean is an analogy to describe the wider, deeper potential of market space that is not yet explored. The corner-stone of Blue Ocean Strategy is 'Value Innovation'. A blue ocean is created when a company achieves value innovation that creates value simultaneously for both the buyer and the company. The innovation (in product, service, or delivery) must raise and create value for the market, while simultaneously reducing or eliminating features or services that are less valued by the current or future market. The authors criticize Michael Porter's idea that successful...
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...Innovation versus Speed Strategy The approach companies take in making strategic decisions regarding such critical aspects including their business model and value chain have direct implications on their ability to sustain themselves over time. The accumulated research shown by Dr. W. Chan Kim and Dr. Renee Mauborgne in their best selling book Blue Ocean Strategy (Kim & Mauborgne, 2005) illustrate that new, uncontested markets are created by the decisions companies make over time rather than high levels of research and development (R&D) spending or intensive mergers and acquisitions (M&A) to acquire patents. The differences between companies who rely on innovation-based strategies relative to those that rely on speed-based ones are most prevalent during the decision of when and how to launch new products. This specific decision is in fact quantified as the single greatest and profit-generating event in the analysis completed (Kim, Mauborgne, 2004). Apple dominates innovation-based decisions and often looks to completely redefine a given marketplace through the sequence of product and service innovations developed. This mindset and resulting decisions within Apple to pursue a strategy of innovation and the development of an entire ecosystem for digital content including iTunes, iPods, and iPhones/iTouch devices has created a platform the company capitalizes on with each product introduction (Jonash, Koehler, & Onassis, 2007). The decision of which features within...
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...IT Doesn’t Matter “IT Doesn’t Matter” is an article written by Nicolas G. Carr and published in the May 2003 edition of the Harvard Business Review. In this article Carr discusses why IT is no longer a strategic resource for companies and in light of this, how companies should now manage their IT. Carr’s argument that IT is no longer a strategic resource stems for his claim that IT has become ubiquitous and is no longer scarce. He does not deny that in its early stages of development, when IT resources were scare or rare, it was a strategic resource that companies could use to gain a competitive advantage. Carr goes on to explain that IT has become more affordable and thus is available for all companies to use. He claims that this makes IT less of a strategic resource and more a commodity. He compares IT’s transition from resource to commodity to that of the development of railway systems and electrical power. He references the fact that these now common commodities were once strategic resources that were used by companies to gain competitive advantages in the late 1800’s and early 1900’s. Carr goes on to explain that no companies base their business strategy on using electrical power and thus business now should transition away from basing strategy on IT. Carr continues with his argument that IT doesn’t matter by describing how the biggest risk with IT is overspending on unnecessary resources, creating a cost disadvantage. Carr outlines three key philosophies...
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... 2) Summarize the article and offer your point of view in relation to the article chosen Title : Army and prisons officials to lead new programme Source : New Sunday Times (27 March 2011) SUMMARY OF ARTICLE: “ARMY AND PRISONS OFFICIALS TO LEAD NEW PROGRAMME” This article is about the new program launched by government that is the National Blue Ocean Strategy (NBOS) program. This program involved army and prison department. Several ministries and government agency contribute to this program. Those Ministries are ministries of Defence; Home; Agriculture and Agro-based industries; Information, Communication and land Culture; Rural and Regional Development; Health; and Civil Defence Department. This program divided into three segments: 1. NBOS 1 * Redeployment of policemen to reduce crime. * Mobilized policemen from desk duties to high-risk areas * Their roles in office will be filled by staff from Administrative and Diplomatic service and also filled by civilians...
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...a leap into the blue ocean W. Chan Kim is The Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International Management at INSEAD. ´ Renee Mauborgne is The INSEAD Distinguished Fellow and a professor of strategy and management at INSEAD. This article is based on their book, Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business School Press, 2005). orporate strategy is heavily influenced by its military roots. The very language of strategy is imbued with military references – chief executive ‘‘officers’’ in ‘‘headquarters’’, ‘‘troops’’ on the ‘‘front lines.’’ Described this way, strategy is about confronting an opponent and fighting over a given piece of land that is both limited and constant. Traditionally, strategy focused on beating the competition, and strategic plans are still couched in warlike terminology. They exhort companies to seize competitive advantage, battle for market share, and fight over price. Competition is a bloody battlefield. C The trouble is that if the opposing army is doing exactly same thing, such strategies often cancel each other out, or trigger immediate tit-for-tat retaliation. Strategy quickly reverts to tactical opportunism. So where should companies turn for a more innovative approach to strategy? The answer lies with something we call blue-ocean strategy. We argue that head-to-head competition results in nothing but a bloody red ocean as rivals fight over...
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...Buyer Utility Map Buyer Utility Map – Software Development Company The buyer utility map assists organizations in knowing how their customers experienced their products and services. According to Kim & Mauborgne, 2005, “a buyer’s experience can usually be broken into a cycle of six stages, running more or less sequentially from purchase to disposal. Each stage encompasses a wide variety of specific experiences”, (pg. 122). Also, “cutting across the stages of the buyer’s experience are what we call utility levers: the ways in which companies can unlock exceptional utility for buyers”. | |Purchase |Delivery | Use |Supplements | |Utility |Is there exceptional |Yes |No |Yes |Yes | | |utility? Are there | | | | | | |compelling reasons to buy| | | | | | |your offering? | | | | | |Price |Is your price easily |No |No |Yes ...
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...S p r i n g 2 0 0 5 | V o l . 4 7 , N o . 3 | R E P R I N T S E R I E S Canifgernia ala oment M Review Blue Ocean Strategy: From Theory to Practice W. Chan Kim Renée Mauborgne © 2005 by The Regents of the University of California Blue Ocean Strategy: FROM THEORY TO PRACTICE W. Chan Kim Renée Mauborgne or twenty-five years, competition has been at the heart of corporate strategy. Today, one can hardly speak of strategy without involving the language of competition: competitive strategy, competitive benchmarking, building competitive advantages, and beating the competition. Such focus on the competition traces back to corporate strategy’s roots in military strategy. The very language of corporate strategy is deeply imbued with military references—chief executive “officers” in “headquarters,” “troops” on the “front lines,” and fighting over a defined battlefield.1 Industrial organization (IO) economics gave formal expression to the prominent importance of competition to firms’ success. IO economics suggests a causal flow from market structure to conduct and performance.2 Here, market structure, given by supply and demand conditions, shapes sellers’ and buyers’ conduct, which, in turn, determines end performance.3 The academics call this the structuralist view, or environmental determinism. Taking market structure as given, much as military strategy takes land as given, such a view drives companies to try to carve out a defensible position against...
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...Visi Pramudia http://visipramudia.wordpress.com/ BLUE OCEAN STRATEGY Authors: W. Chan Kim – Renee Mauborgne How to Create Uncontested Market Space and Make the Competition Irrelevant Visi Pramudia http://visipramudia.wordpress.com/ I. THE STRATEGY Visi Pramudia http://visipramudia.wordpress.com/ New Market Space known market space RED OCEAN Represent all the industries in existence today BLUE OCEAN Denote all the industries not in existence today space Circus Industry Traditional Circus: • Target Market : Children • Dependent to : Star performance, animal shows • High fun & humor • High Thrills & dangers unknown market Cirque du Soleil: • Target Market : Adults • Not Dependent to Star performance & animal shows • Reduce fun & humor • Reduce Thrills & dangers • Unique Venue • Theme & Theater Low Cost, High Price High Cost, Low Price Visi Pramudia http://visipramudia.wordpress.com/ The Cornerstone of Blue Ocean Strategy • Value innovation is created in the region where a company’s actions favorably affect both its cost structure and its value proportion to buyers • Cost savings are made by eliminating and reducing the factors an industry competes on • Buyer values is lifted by raising & creating elements the industry has never offered • Over time, costs are reduced further as scale economies kick in due to the high sales volumes that superior value generates The Simultaneous Pursuit of Differentiation and Low Cost Visi...
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