Blue Ocean Strategy - Presentation

Red Oceans…..
Red Oceans…Industries and boundaries are

defined and accepted.
Constant try to outperform the competitors

and grab existing market space.
Prospects of profit and growth reduced.

Blue Oceans….
Blue Oceans are defines by untapped market
space, demand creation and opportunity for
high profit growth.
Some are created from well beyond existing

markets, but major are created out of existing
market .
With advancement in technology blue oceans

turns into red…
Six Principle of Blue Ocean Strategy
Reconstruct Market Boundries.
Focus on the big picture, not the numbers.
Reach beyond existing demand.
Get the strategic sequence right.
Overcome key organizational hurdles.
Build execution into strategy

Value Innovation
Analytic Tools And Framework
A Good Strategy
Focus
Divergence
Compelling Tagline
Tale of 6 Principles
of creating blue oceans
Reconstruct market boundaries
• Break out of accepted boundaries of competition

and create new ones, ie- blue oceans
Address the search risk,many companies
struggle with.
Develop a systematic pattern to create products
and services of exceptional value.
six path framework for blue ocean creation.
SIX PATH FRAMEWORK FOR CREATING SUCESSFUL BLUE OCEANS
> From Red Ocean to Blue Ocean Creation

head to head competition blue ocean
creation
Industry Focuses on rivals within Looks across alternative

industry industries.
Strategic Groups focus on competitive position Looks across strategic

with strategic groups group within industry.
Buyer group Focuses on better serving the Redefines the industry

buyer
buyer group. group.
Scope of product or service Focuses on maximizing the Looks across to
Offerings value of product and services complimentary product and
offerings within the bounds of service offerings.
its industry.
SIX PATH FRAMEWORK FOR CREATING SUCESSFUL BLUE OCEANS
Contd……………..
From Red Ocean Strategy to Blue ocean creation

Big Picture not Numbers
Provide insight as how six path framework can be

effectively implemented.
Talks about developing an alternative approach to

strategic planning process.
Highlights common mistakes which keep the companies

struggling in red ocean.
Strategy canvas to visualize Blue Ocean strategy.

4 steps to visualize a Blue Ocean Strategy.
1. Visual 2. Visual 3.Visual 4.Visual

Awakening Exploration Strategy Fair Communication
•Compare your •Go into the field to •Draw your to be •Distribute your
business with your explore six paths to strategy canvas before and after
competitors by creating blue oceans. based on insights strategic profiles.
drawing your “as is “ •Observe the from field •Support only those
Strategy canvas. distinctive observations. projects and
advantages of •Get feedback on operational moves
•See where your alternative products alternative strategy that allow to close
strategy needs to and services. canvases from the gaps to actualize
change. •See which factors customers,competitor new strategy.
you should eliminate, ’s customers and
Create,change. non-customer’s.
•Use feedback to
build the best “to be”
Future technology.
GET THE STRATEGIC
SEQUENCE RIGHT
RIGHT SEQUENCE OF BLUE OCEAN STRATEGY:
 BUYER UTILITY:
CLEAR ACCEPTIONAL UTILITY BAR
 PRICE:
ACCESIBLE TO BUYER
COMPELLING REASON FOR BUYER TO BUY.
OFFERING CREATE IRRESTIBLE BUZZ AMONG THE BUYERS.
 COST:
COST EFFECTIVE LEADING TO PROFIT.
 ADOPTION:-
HURDLES IN ADOPTION OF BUSINESS IDEA.
POTENTIAL RESISTANCE TO IDEA BY RETAILERS OR PARTNERS.
IF ALL THE STRATEGIC SEQUENCES ARE RIGHT THAN THE PRODUCT IS

COMMERCIALLY VIABLE.
CREATING EXCEPTIONAL UTILITY FOR VALUE
 EG.PHILLIPS CD-I
 UNLESS PRODUCT IS USER FRIENDLY,SIMPLER,CONVENIENT,IT WILL NOT

ATTRACT THE MASSES NO MATTTER HOW BIG IT IS.
 VALUE INNOVATION IS NOT SAME AS TECHNOLOGY INNOVATION
STRATEGIC PRICING TO TARGET COSTING:

FOR MAXIMISATION OF PROFIT
Overcoming organizational hurdles
Main hurdles to be overcome-
 1)Making employees understand that the shift is needed

 2)Limited resources
 3)Motivation
 4) Internal politics
The key to unlocking a motivation epidemic is to concentration

rather than diffusion.
Make people experience harsh realities first hand.
Tipping point leadership builds on the seeing, hearing, feeling

insight to change the mindset of internally driven people.
Angels And Devils….
To trigger change in employees target kingpins as
they are the best to induce change.
Use the fish bowl strategy specially to

demonstrate the performance of the kingpins.
Do not follow conventional wisdom and focus on

acts of disproportionate influence
Curb Politics
Leveraging Silencing
Angels Politics Devils
Consigliore
Build execution into strategy
The 6th principle of blue ocean strategy – To build peoples

trust and commitment deep in the ranks and inspire their
voluntary cooperation for the companies need to build
execution into strategy from the start.
The mutually reinforcing principles that define fair process –

the 3 E principles of fair management
1) engagement
2) explanation
3) clarity of expectation
Create a culture of trust and commitment
Employees should not be confused and suspicious of

management plans.
Individuals intellect and emotions should be

applauded and then they feel like working and
performing better.
Commitments, trust, voluntary cooperation are not

mainly behaviors or attributes but intangible capital.
Barriers to imitation…
Blue ocean strategy may conflict with other
companies brand image
Natural monopoly: The market often cannot

support the second player
Patents or legal permits block imitation
High volume lead to rapid cost advantage for the

value innovator
Contd…
Imitation often requires significant political,
operational and cultural changes
Companies that value innovate on brand buzz

and a loyal customer following that tends to
shun imitators
Learning…
There is no permanent excellent industry
There is no permanent excellent company
Startups have natural advantages over

established companies in creating new market
space
Value innovation: innovation that was linked to

buyers value
Creates positive effect in buyers mind

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What are the six principles of blue ocean strategy?

What are the six principles of blue ocean strategy?

What is the difference between value innovation and technology innovation?

What is the difference between value innovation and technology innovation?

Red Oceans…..

Red Oceans…Industries and boundaries are

Constant try to outperform the competitors

Prospects of profit and growth reduced.

Some are created from well beyond existing

With advancement in technology blue oceans

Reconstruct Market Boundries.

Focus on the big picture, not the numbers.

Reach beyond existing demand.

Get the strategic sequence right.

Overcome key organizational hurdles.

Build execution into strategy

• Break out of accepted boundaries of competition

> From Red Ocean to Blue Ocean Creation

Industry Focuses on rivals within Looks across alternative

Strategic Groups focus on competitive position Looks across strategic

Buyer group Focuses on better serving the Redefines the industry

From Red Ocean Strategy to Blue ocean creation

Provide insight as how six path framework can be

Talks about developing an alternative approach to

Highlights common mistakes which keep the companies

Strategy canvas to visualize Blue Ocean strategy.

1. Visual 2. Visual 3.Visual 4.Visual

IF ALL THE STRATEGIC SEQUENCES ARE RIGHT THAN THE PRODUCT IS

 UNLESS PRODUCT IS USER FRIENDLY,SIMPLER,CONVENIENT,IT WILL NOT

 VALUE INNOVATION IS NOT SAME AS TECHNOLOGY INNOVATION

STRATEGIC PRICING TO TARGET COSTING:

 1)Making employees understand that the shift is needed

The key to unlocking a motivation epidemic is to concentration

Make people experience harsh realities first hand.

Tipping point leadership builds on the seeing, hearing, feeling

Use the fish bowl strategy specially to

Do not follow conventional wisdom and focus on

The 6th principle of blue ocean strategy – To build peoples

The mutually reinforcing principles that define fair process –

Employees should not be confused and suspicious of

Individuals intellect and emotions should be

Commitments, trust, voluntary cooperation are not

Natural monopoly: The market often cannot

Patents or legal permits block imitation

High volume lead to rapid cost advantage for the

Companies that value innovate on brand buzz

There is no permanent excellent company

Startups have natural advantages over

Value innovation: innovation that was linked to

Creates positive effect in buyers mind

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