Post on 03-Apr-2018
by Jay Robinson
Source: Blue Ocean Strategy by W. Chan Kim & Renée Mauborgne
Blue Ocean Strategy Summary
Red Ocean: Companies compete for customers
Chapter 1
Blue Ocean: Company creates new market
Chapter 1
Chapter 2
Increase value to consumer
Decrease costs
GOAL
Value Innovation
Analytical Tools and Frameworks
• Strategy Canvas
• Four Actions Framework
• Eliminate-Reduce-Raise-Create Grid
3 Characteristics of Blue Ocean Strategy
1. Focus2. Divergence3. Compelling Tag line
Chapter 2
Strategy Canvas
Variables
Value
Chapter 2
Four Actions Framework
Reduce factorsbelow the standard
Createfactors never before offered
New Value Curve
Chapter 2
Raise factors well below the
standard
Eliminatefactors taken for granted
Eliminate• • •
Raise• • •
Reduce• • •
Create• • •
Eliminate-Reduce-Raise-Create
Chapter 2
Reconstruct Market BoundariesLook Across Alternative IndustriesLook Across Strategic Groups Within
IndustriesLook Across the Chain of BuyersLook Across Complementary Product and
Service OfferingsLook Across Functional or Emotional Appeal
to BuyersLook Across Time
Chapter 3
Visualize StrategyVisual Awakening; See where you areVisual Exploration; See how others see
youVisual Strategy Fair; See where you could
beVisual Communication; Draw a Map for
everyone (Pioneer-Migrator-Settler Map)
Chapter 4
3 Tiers of Noncustomers
Chapter 5
Your Market1st Tier
2nd Tier
3rd Tier
3 Tiers of Noncustomers
Chapter 5
1st Tier - “Soon-to-be” noncustomers
2nd Tier - Those who consciously refuse your market
3rd Tier - “Unexplored” noncustomers in distant markets
No -- Rethink
No -- Rethink
Buyer utilityIs there exceptional buyer utility in your business idea?
Sequence of Blue Ocean Strategy
Chapter 6
Yes
PriceIs your price easily accessible to the mass of buyers?
CostCan you attain your cost target to profit at your strategic price?
AdoptionWhat are the adoption hurdles in actualizing your business idea? Are you addressing them up front?
Yes
Yes
A Commercially Viable Blue Ocean Idea
No -- Rethink
Yes
No -- Rethink
The Buyer Utility Map
Chapter 6
1. Purchase
2. Delivery
3. Use
4. Supplements
5. Maintenance
6. Disposal
Customer productivity
Simplicity
Convenience
Risk
Fun and image
Environmental friendliness
The Six Stages of the Buyer Experience Cycle
The
Six
Utilit
y Le
vers