Blue Ocean Strategy, was published in 2005 and has been a major best seller since. It is with good reason; it sets out an innovative and inspiring way of thinking about marketing strategy, to produce business growth through differentiation and value innovation. It argues that fighting for incremental growth in a company’s share of established markets, is not the way to achieve exceptional business success, even for the existing players in such markets.
What is Blue Ocean Strategy?
In the first of its three parts, Blue Ocean Strategy explains what the authors mean by blue oceans as opposed to the red oceans of existing competitive markets. There are two chapters:
- Creating Blue Oceans. It provides examples of businesses that have created and entered new markets through value innovation. It explains the characteristics and principles of a “blue ocean” and sets out the structure of the rest of the book.
- Analytical Tools and Frameworks. The authors W. Chan Kim and Renee Mauborgne walk the reader through a set of tools and analysis process to identify and define a blue ocean strategy. The ideas are deceptively simple in concept and easy to understand. In particular the key is the strategy canvas, a simple idea that properly executed will give real insights.
However although the ideas are straightforward the work involved in using them is challenging. That said no one expects innovation to be easy. The authors make a strong case that diligent effort will be worthwhile.
Formulating Blue Ocean Strategy
The second part moves on to practicalities of working through the process of developing a blue ocean strategy. It is here where the effort needed becomes clear but again it is well explained and makes so much sense. The principal steps are:
- Reconstruct Market Boundaries
- Focus on the Big Picture, Not the Numbers
- Reach Beyond Existing Demand
- Get the Strategic Sequence Right
The approach will take many managers away from their comfort zone and require them to understand their market in completely new ways. They will not be able to hide behind easy assumptions but the benefits could be substantial.
Executing Blue Ocean Strategy
Finally Blue Ocean Strategy addresses the questions around implementing the newly defined blue ocean strategy. The last three chapters provides a quick overview of the important factors in making the strategy happen:
- Overcome Key Organizational Hurdles
- Build Execution into Strategy
- Conclusion: The Sustainability and Renewal of Blue Ocean Strategy
All business managers with responsibility for strategy, especially any who wish to make the competition irrelevant, should read Blue Ocean Strategy. Traditionally military leaders have always wanted to take the initiative by choosing the field of battle. In Blue Ocean Strategy business leaders are shown how they can do the same be redefining the marketplace to compete on their strengths.
The ideas and approach will work equally well for new or established businesses of any size. Blue Ocean Strategy is an easy read with powerful ideas that belie their apparent simplicity. It will take a rigorous approach to use the ideas but when well executed should deliver considerable rewards.
Blue Ocean Strategy is strongly recommended and fully justifies its best seller success. It is a serious candidate for being the best recent book on business strategy; it is destined to become a classic.
The Authors
W. Chan Kim and Renee Mauborgne are professors of strategy and management at INSEAD and co-directors of INSEAD Blue Ocean Strategy Institute in Fonainebleu, France.
Blue Ocean Strategy, How to Create Uncontested Market Space and Make the Competition Irrelevant (2005, ISBN: 978-1-59139-619-0) by W Chan Kim and Renee Mauborgne is published in hardback by Harvard Business Review Press at $29.95.
Martin P Wilson - Martin is a director of major business change & turnaround consultant by profession but a widely published writer & photographer by ...
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