about winning without fighting

Blue Ocean Strategy

How to create uncontested market space and make the competition irrelevant.

to fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy's resistance without fighting

Master Sun Tzu in Art of War

What does Blue Strategy!!

The aim of BOS is not to out-perform the competition in the existing industry, but to create new market space or a blue ocean, thereby making the competition irrelevant. BOS is the simultaneous pursuit of differentiation and low cost.

Summary of Blue Ocean Strategy

New Market Space Continuing Creation of Blue Oceans Impact of Creating Blue Oceans Rising Imperative of Creating Blue Oceans From Company and Industry to Strategic Move Value Innovation

Formulating and Executing Blue Oceans

6 principles of Blue Ocean Strategy

1. 2. 3. 4. 5. 6. Reconstruct market boundaries Focus on Big picture, not on the numbers Reach Beyond existing demand Get the Strategic Sequence right Overcome Key organizational Hurdles Build Execution into strategy.

The Six Conventional Boundaries of Competition

Path 1: Look Across Alternative Industry

Path 2: Look Across Strategic Groups within Industries

Path 3: Look Across the Chain of Buyers

Path 4: Look Across Complementary Scope of Product & Services

Path 5: Look Across Functional or Emotional Appeal to Buyers Path 6: Look Across Time

Red Ocean v/s Blue Ocean

4 Action Framework

4 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.

VALUE INNOVATION
Cost savings are made by eliminating and reducing the factors an industry competes on. Buyer value is lifted by raising and creating elements never offered Thereby opening up new and uncontested market space

ELIMINATE
REDUCE

RAISE CREATE

Reaching Beyond Existing Demands

Reaching Beyond Existing Demands

Three Tiers of non customers
First Tier: Soon to be Second Tier: Refusing

Third Tier: Unexplored

Three Principles of Fair Process

Buyers Utility (Is there exceptional Buyer
Utility into your Business idea?)

Price (Is Your price is easily accesible to the

target mass of buyers?)

Cost (Can you attain your cost target to

profit at your strategic price?) Adoption (What are the Adoption hurdles in actualizing
your business idea? Are you adressing them up front?)

A Commercially viable Blue Ocean Idea

Sequence of Blue Ocean Strategy

1. Buyer Utility: Does it offer exceptional utility, create value addition to customers. 2. Price: Is your price attractive enough for mass of the target buyers. 3. Cost: Can you earn healthy profit margin.

4. Adoption: Overcoming hurdles from all kind of possibilities.

Two key Implementation Risk

Organizational Risk
4 key hurdles that blocks the implementation of the strategy
Tipping point Leadership (TPL)

Management Risk
Distrust can derail the execution of blue ocean strategy

Fair Process

Why Fair Process?

FOUR ORGANISATIONAL HURDLES TO STRATEGY EXECUTION

Organizational Hurdles
Cognitive hurdles mental blocks that keeps from realizing a need for change Strategies facing individual operational problems

Resource hurdles limited resources to execute a strategic shift

Strategies identify the cold and hot spots and redistribute resources to hot spots

Organizational Hurdles
Motivational hurdles blocks in motivating employees in executing a new strategy Political hurdles strategic shift is blocked by powerful vested interests Strategies seek mass concentration over mass mobilization

Strategies leverage angels, devils, and the advisor

Strategy Canvas
O F F E R I N G
L E V E L

Competing Factor

Cricket Before IPL

High

Test Cricket

One Day

Low

Spectator Time

Classic Technique

Value of Team Reputation

Emphasis on Patience & Perseverance

Entertainment

Pacy

Definite Result

Athleticism

Cricket After IPL

High

Low
Test Cricket One Day 20-20

Spectator Time

Classic Technique

Value of Team Emphasis on Entertainment Reputation Patience & Perseverance

Pacy

Definite Result Athleticism

City Loyalty

Open to Dummies

Value Curve For IPL

Reduce
Spectator Time Invested (Competes with Movie/Football) Emphasis on Classic Techniques (Batting/Bowling) Emphasis on Patience, Perseverance

Raise
Emphasis on Athleticism Pace of the Game Entertainment with Bollywood, Cheerleaders etc. Certainty of Result

Create
City Loyalty Welcome to Dummies