Blue Ocean Strategy

Blue Ocean Strategy
(W. Chan Kim, Renee Mauborgne)

Blue Ocean Strategy is a new revolution in business strategy and global initiatives to incorporate creativity and innovation in the business planning and operations for capturing untapped market. A world class enterprise of tomorrow will need to move away from traditional approach of increasing productivity or incentives to customers for staying on top through cut-throat competition. Based on in-depth study of number of leading industries, the authors remind us that in emerging business scenario there is no permanent great company or industry or market or business alliance , instead success comes from being proactive and anticipating cultural, socioeconomic ,environmental, technological advancement and adapting new frameworks and analytical business tools to develop Blue Ocean Strategy.
With the growing popularity of Blue Ocean Strategy, all world class companies will do away with traditional business approach of maximizing productivity or lowering price to have sustained profitable growth. Their existing competitive advantage, and struggle for bigger market share, product differentiation, customer mapping will be irrelevant and they will have to realign exiting market boundaries, determine their value curve and adopt proactive strategy. To siege new business opportunities, they need to shift from incremental improvement approach and have quantum jump by aligning innovation with customer utility, price and cost and thus creating compelling effect on untapped customer segment.
Blue ocean strategies necessitate having clear business focus, divergence, compelling tagline and looking across the alternate industries/ services, strategic groups within industry, chain of buyers and functional /emotional appeal of buyers. A case in point is Curves; a Texas based Women Fitness Company, which most successfully created Blue Ocean space by cutting across the well established health clubs and low-cost home exercise programs.Future business strategies would be like road-maps drawn on a canvas keeping big picture in focus, recognizing need for change, exploring business options, drawing value curve through participative decision making and maintaining clear and effective lines of communications. The technological revolution of interment and information technology, globalization of business and role of WTO, international focus on environmental control, disappearance of time zones with 24x7 operations, are already having great impact on business strategies of enterprises. Future global leaders will have to look beyond the existing demands, draw new market boundaries, set strategic sequence of buyer utility, price, cost ,adoption and overcome organizational hurdles.
The authors also highlight that creating and adopting Blue Ocean strategy is not a simple roadmap on a paper but an ongoing dynamic process demanding very high level of commitment, integrity, trust, positive attitude and energy to sustain pressures from various forces and move to uncontested market space.
INSEAD Blue Ocean Strategy Institute, Fontainebleau, France