Blue Ocean Strategy

Contents
1. Blue Ocean Vs. Red Ocean Strategy 2. Blue Ocean Strategy Tools 3. Strategy Canvas and Four Action Framework 4. Formulating Blue Ocean Strategy 5. Executing Blue Ocean Strategy

Blue Ocean Vs. Red Ocean Strategy

Blue Ocean vs. Red Ocean Strategy

Blue Ocean Strategy Red Ocean Strategy

Create uncontested
market space Make the competition

Compete in existing
market space Beat the competition Exploit existing demand

irrelevant
Create and capture new demand

Blue Ocean vs. Red Ocean Strategy

Blue Ocean Strategy Red Ocean Strategy

Break the value- cost trade off Align the whole system of a firms activities with its strategic choice of differentiation and low cost

Make the value-cost trade off Align the whole system of a firms activities with its strategic choice of differentiation or low cost

Blue Ocean Strategy Tools

A diagnostic tool for building a compelling blue ocean strategy It captures the current state of play in the known market space Allow you to understand :

Strategy Canvas

where the competition is currently

investing the factors the industry currently competes on in product, service and delivery

what customers receive from existing competitive offerings on the market

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Four Action Framework

Eliminate

Raise

Reduce

Create

Four Action Framework

Eliminate
Which of the factors that the industry takes for granted should be eliminated? Which factors should be reduced well below the industrys standard?

Reduce

Raise

Which factors should be raised well above the industrys standard?

Which factors should be created that the industry has never offered?
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Create

Four Action Framework The Case of Cirque du Soleil (A Circus Company) Eliminate
Star performers Animal shows Aisle concession sales Multiple show arenas

Reduce
Fun and humor Thrill and danger

Create
Theme Refined environment Multiple productions Artistic music and dance

Raise
Unique venue

1. Reconstruct Market Boundaries

Head-to-Head Strategy Blue Ocean Strategy

Focuses on maximizing the value of product or service offerings within the bounds of its industry

Looks across to
complementary product and service offerings

Participates in shaping
external trends over time

Focuses on adapting to

external trends as they

occur
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2. Focus on the Big Picture, not the Numbers

Visual Awakening

Compare your business with your competitors by drawing your as is strategy canvas See where your strategy needs to change

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Executing Blue Ocean Strategy

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