Latest "Blue Ocean Strategy" Posts

Value Innovation in 2011

Are you happy with your strategy? Are you bringing in new customers that have never bought from you or your competitors before? Think, Nintendo Wii. Sataru Iwata looked past the competition; looked past the market of young antisocial males who bought most of the electronic games, and created a huge mass market that had never before purchased electronic games. Their competition is still scrambling years later.

So what are you doing to expand your horizons into a new market? Do you think it is not possible for you and your company? It not only is possible, it is being accomplished by organizations from police departments (NYPD) to governments (CHINA) to classical maestos (Andre Rieu), not to mention the traditional organizations like Nintendo, HCL financial and CROC.

Posted in Blue Ocean Strategy, Growth by Dr. Sarah Layton on January 18, 2011.

Is Hysteria a Blue Ocean Strategy? Groupon gives it a try

Groupon is the fastest growing company on the planet and has created quite a stir with its online deals. When they post a deal, you only have a short time to buy and if there aren’t enough buyers by a certain deadline, then the deal is off. Is this a Blue Ocean for Groupon? Click on this link and see a short video analyzing the situation.

Posted in Blue Ocean Strategy by Dr. Sarah Layton on August 14, 2010.

Can BP find a Blue Ocean Strategy?

BP has been in hot oil for months now. Can they find a Blue Ocean Strategy after all this? Click to see this video or cut and paste into your browser.

Posted in Blue Ocean Strategy, Governance by Dr. Sarah Layton on August 10, 2010.

Blue Ocean Strategy Tools: The Four Actions Framework and ERRC Grid

After you define the three tiers of non customers, the idea is that you poll these noncustomers and find out what it would take to purchase your product or service. For example, Nintendo asked people in their three tiers why they didn’t play games. Then they asked what would entice them to play. They took the answers to those questions and designed the Nintendo Wii. It has been a huge hit, attracting noncustomers who never before played electronic games.

Posted in Blue Ocean Strategy by Dr. Sarah Layton on July 6, 2009.

The Three Tiers Tool – Identifying your non customers

OK, so now you have created your PMS map and are realizing most of your products are in a great big bloody Red Ocean where you are constantly fighting off the competition in a shrinking pool of revenue and profit. You have created your strategy canvas, and have tested the competitive factors so you know just what factors the market makes decisions. Now what?

Well, this is the fun part. Looking at your strategy canvas and the competitive factors, there are four things you can do with competitive factors. You can eliminate them, reduce your investment or level of offering in them, raise your investment or level of offering in them, or create new ones. It is these actions or strategic moves taken by the CEO that helps to formulate the new blue ocean strategy.

Posted in Blue Ocean Strategy, Growth, Strategic Planning by Dr. Sarah Layton on June 24, 2009.

Can there be a Blue Ocean Strategy in the Training and Development Industry?

Note: A few days ago I attended the ASTD conference in Washington, DC specifically to hear the keynote address given by Renee Mauborgne. Rene is co-researcher and co-author for the best selling book Blue Ocean Strategy: How to create uncontested market space and make the competition irrelevant.

According to Tim Hill, President, Blackboard Learn Professional Education, Blackboard Inc, the training and development industry is a splintered industry with a lot of competition. “Very red”, he says, when putting it in the context of Blue Ocean Red Ocean terminology, where blue oceans are new market spaces with no competition, and red oceans are the current market spaces where all the competitors compete.

Posted in Blue Ocean Strategy, Strategic Planning by Dr. Sarah Layton on June 17, 2009.

Creating your strategy canvas

The Strategy Canvas is a critical diagnostic and action tool utilized in the Blue Ocean Strategy process. It allows an organization to visualize the competitive factors and the current state of play of those factors within an industry and then compares the organization’s offering with those of the industry in general. When combined with other tools, the strategy canvas helps you create your new blue ocean strategy.

We have already discussed Value Innovation as being key to Blue Ocean Strategy (see April 1, 2009 blog post). The strategy canvas helps you to create value innovation. As you read this, refer to the strategy canvas example below of the electronic games industry.

Posted in Blue Ocean Strategy by Dr. Sarah Layton on May 11, 2009.

The Pioneer-Migrator-Settler Map: Visualizing the potential of each product in the future growth of the company

Often in the corporate world, we get so buried in numbers and words that it is difficult to see the big picture. One of the key principles of Blue Ocean Strategy is to focus on the big picture, not the numbers. How much easier it is to understand a position or concept when you can see a picture of it.

The Pioneer-Migrator-Settler (PMS) Map is a diagnostic tool that allows you to see just how your revenue generating products and services fare in their contribution to the future growth of the company. It helps you determine if you are fighting for your life in the Bloody Red Ocean of competition or enjoying the beautiful deep Blue Ocean with no competition in sight. Key products are organized into three categories and then displayed by size.

Posted in Blue Ocean Strategy, Growth by Dr. Sarah Layton on April 29, 2009.

Red Ocean vs. Blue Ocean

Don’t you just hate when people make up terminology to suit their purpose? You may think that Chan Kim and Renee Mauborgne may fall into the category of trying to coin new words to set their concepts apart, but there is method to the madness.

The concept is quite simple to understand. The Red Ocean is where every industry is today. There is a defined market, defined competitors and a typical way to run a business in any specific industry. The researchers called this the Red Ocean, analogous to a shark infested ocean where the sharks are fighting each other for the same prey.

Posted in Blue Ocean Strategy by Dr. Sarah Layton on April 21, 2009.

Aligning Utility or Usefulness to Create Value Innovation

In order to have value innovation, the value to the customer, the price to the customer and the cost to the company, must all be aligned. If any of these three elements are out of alignment, the initiative will not be a commercial success. Just try to have the price out of alignment with the cost. The company will lose money. Or have the price not in line with the value to the customer, the customer won’t buy and the product won’t be a commercial success.

Posted in Blue Ocean Strategy, Growth by Dr. Sarah Layton on April 11, 2009.