Blue Ocean Strategy

Strategic Planning-

Leaning to swim in a Blue Ocean with no sharks

When I hear, “Think outside the box,” I cringe. I believe that this command frustrates analytical people; they do not know what to do, or how to do it because there are no rules or assumptions.Instead, I like to tell people to use the right side of their brain – the creative side.A strategic planning approach, The Blue Ocean Strategy, facilitates this type of thinking.

Blue Ocean Strategy (BOS) is a corporate strategy and business book written by Professors W. Chan Kim and Ren© Mauborgne, of INSEAD. The strategy attempts to create an uncontested market space, and thereby make competition irrelevant. Dim & Maubourgne initially called this “Value Innovation,” in 5 articles for the Harvard Business Review published before their 2005 book. BOS is the result of a decade-long study of 150 strategic moves spanning more than 30 industries over 100 years (1880-2000).

There is no easy way to quickly describe BOS, except by example. Cirque du Soleil is a good example of a company that meets the BOS criteria (focus, divergence, and compelling tagline).For example, compare this circus to Ringling Bros. using the following factors: star performers, animal shows, 3-ring arenas, aisle concessions, theme, unique venue, and artistic dances. Cirque du Soleil concluded that the public really did not want star performers, animal shows, 3-ring arenas, and aisle concessions.In addition, star performers and animal shows were very expensive.They decided to do away with the three, but added theme, unique venue and artistic dances. This created a unique market because they were discarding what the public did not value, and added new aspects that the public would value.Instead of being in a “bloody” red ocean competing on price or quality, they could be competitive by offering a new experience for the audience.

If you are in the artistic world, maybe I can stretch this example to Paul Simon.In 1986, he could have composed music using the same style such as folk (Simon & Garfunkel), or a pop (Kodachrome).However, he used his artistic ability to expand his use of world music. In 1986 he released Grammy award-winning Graceland, which featured the groundbreaking use of African rhythms and performers. In 1990, he followed with the album The Rhythm of the Saints, which featured Brazilian musical themes. These albums helped to popularize world music as a genre.It essentially created a blue ocean for him without competition in a new genre.

Now this is not to say that every blue ocean does not turn red, because once the idea is manifested, there is a window of uncontested opportunity.So, what a business must do is continually develop blue oceans and keep ahead of the competition.

This strategy theory is great, but 80% of strategies are not implemented. To make the system complete you should integrate other business requirements like forecasting techniques, critical success factors, benchmarks, monitoring systems, and reporting dashboards.We pride ourselves on offering this continuum so that your blue ocean doesn’t bleed red.

 

Call Us (310) 216-7632 or

Send Message

Send Message