Why Blue-Ocean Strategy Will Make You Question Everything?

Blue Ocean Strategy is basically a book written by W. Chan Kim and Renee Mauborgne which got published in 2005. After doing lots of strategic studies, both Kim and Renne, came up with a point that companies like Banks, hotels, airlines, automobile industries or any other firms can run successfully not by defeating their competitors but by the strategy of making blue ocean.

Blue Ocean Strategy also states that the market boundary along with structural plan of an industry is not fixed but in fact they can be reworked by the experts leading in the industry.

“Blue Oceans” refers to an unchallenged new market space. To obtain new profit and growth in the company one should create a blue ocean. It denotes all the industries not in existence today — the unknown market space, untainted by competition.

“Red oceans” represent all the industries in existence today — the known market space. In the red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known.

The key to exceptional business success, they say, is to redefine the terms of competition and move into the “blue ocean,” where you have the water to yourself. The goal of these strategies is not to beat the competition, but to make the competition irrelevant.

Now comes the point that how an employee of a bank or the employer or any other leader of any firm can create a blue ocean. Please try to understand that this strategy is not related to supply or demand. This strategy can be created simultaneously by pursuing the differentiation as well as low cost. Now you will think what we mean by differentiation in economical term. In order to make you understand in a simple way, we can state that differentiation is nothing but a process of differentiating your own product or service from others so that you can make your company’s product more appealing into that particular market space.

This strategy also provides a chance to move ahead step after step. The manager of a bank along with his team can develop concrete ideas keeping big picture in mind. Thus, it provides an alternative planning process to the current process.

Blue Ocean Strategy is also based on a theory of maximising opportunity and minimising risk.

We can easily state that Blue Ocean Strategy shows you a path of coming out in a win-win situation.