How To Follow The Blue Oceans in Your Bussiness
‘Blue Ocean’ is a term with new ideas heads up in your business to propel in a right way. It may appear neophyte to you. But, it does work a lot that you will feel soon for sound business.What would be the future market for secure investment is quite unpredictable. Even, we don’t know what is going to happen next. The world is now in a shape with unrest geo politics. Many a businessman runs their gear to the competitive market. Then few of them can share their true smile. However, the whole industry is a fact dedicated to trying to do just this.
Then a deep thought starts finding in your mind how you can get new ideas for safe investment. You may YouTube or Google to find Futurism. For instance, Silicon Valley’s tech evangelists have grown up into a worthwhile business in these days that claims to be able to state companies what will happen to the next.
The experts say that they can detect the next billion-dollar start-up from its inception to be near the giant business. Artificial intelligence, automation and so forth tech of things are now getting popular for these estimates and are generally reflect the ultimate vision of technology-assisted life.
Now the word ‘Blue Ocean strategy’ is a concern to get informed for your business.
The Research Behind Blue Ocean Strategy
There are more than fifteen years of research regarding blue ocean strategy. Even, Harvard Business Review has published different articles on various dimensions of this topic. Many industries like automobiles, aviation, petrochemicals, music recording, and health career had just begun to emerge in the past. If we turn the clock back only thirty years from now what we see. Once again, a surfeit of multibillion-dollar industries leaps out.
New innovative ideas grow up through merger and acquisition. Likely, Cell phones, electricity plants, biotechnology, mutual funds, discount retail, express package delivery, snowboards, coffee bars, and home videos, are some of the examples. We couldn’t expect such things date back to thirty years. Now put your head forward twenty years or fifty years, how many unknown industries can you guess? The answer is many of them. Industries never stand still. Operations improve, markets expand continuously evolve.
We have enormous capacity to create new industries and re-build remaining ones over the years. The concept ‘Blue Ocean Strategy’ came from W. Chan Kim and Renée Mauborgne.They are the professors of INSEAD and co-directors of the INSEAD Blue Ocean Strategy Institute. They proposed companies can thrive by ‘blue oceans’ an uncontested market space. It is based on a study of 150 tactical moves spanning more than a hundred years and thirty industries. This strategy forms value for the company, its purchasers, and its staffs while revealing new demand and making the competition extraneous.
The four principles of blue ocean strategic business are:
- how to create open market space by reforming market boundaries,
- focusing on the big picture,
- reaching beyond existing demand and
- getting the strategic sequence right.
Blue ocean vs. red ocean
Our markets are full of old-style competition. When traditional competition (red ocean strategies) are necessary, they are insufficient to withstand great performance. Companies may need to go beyond competing. They emphasis on building advantages over the competition. Here, grabbing a bigger part of the market is seen in which one company’s gain is attained at another company’s loss.
Blue ocean strategy, on the other hand, is based on the view that market boundaries and industry structure are not assumed and can be rebuilt by the activities and principles of industry players. Supply to demand from competing to value innovation is the formation of innovative assessment to reveal new demand. This is achieved via the simultaneous detection of differentiation and low-cost. By expanding demand of the economy, new wealth is increased. Such a strategy, therefore, needs firms to mostly play with high reckoning potentials.
Red Ocean Vs. Blue Ocean Strategy
|Compare in existing market space||Create Uncontested market space|
|Beat the race||Make the Competition immaterial|
|Feat existing demand||Create and capture new demand|
|Make the value-cost trade-off||Break the value-cost trade-off|
|Align the whole system of a firm’s activities with its tactical choice of differentiation or low cost.||Align the whole systems of a firm’s activities in the detection of differentiation and low cost.|
Blue Ocean Strategy for Business:
There are twelve strategies for a traditional business to turn out for blue ocean business. Maintaining portfolio, Visualization, understanding buyer experience, innovative ideas expansion, e-commerce, strategy canvass, reconstruct markets, research beyond the markets for existing demands, break the value of cost trade off, and business execution etc will make your business in a new shape to run your business smoothly. The twelve strategies are as follows:
Principles of Blue Ocean Strategy
In order to find the best and expected outcomes for this strategy is to formulate principles, maintain risk factors, execute the principles, analyze the risk factor. There are six principles for Blue Ocean Strategy to run a business. There are six principles as follows:
The Six Principles of Blue Ocean Strategy
|Formulation Principles||Risk Factor each Principle Attenuates|
|Reconstruct market boundaries||Search Risk|
|Focus on the large picture, not the numbers||Planning Risk
|Reach beyond remaining demand Scale Risk
|Business Model Risk|
|Get strategic sequence right|
Execution Principles Risk Factor Each Principle Attenuates
- Overcome Key Organizational Hurdles
- Organizational Risk
- Build execution into Strategy
- Management Risk
Uber: A role model for Blue ocean business
Just 6years back from now, what will you realize in fleet management; using of walky-talky. But nowUber, a taxi service app with dispatch solution that first launched in the US in 2011 and was valued at $62.5bn in 2015, is getting a focal case study for Webb’s method. It follows total fleet management service within its dispatch solution, tracks the acquisitions, and assumes that by 2030 it could have “upset modern farming” by automating every element.
Realized through Webb’s eyes, Uber ceases to be merely a cab company and has the prospective to become “the imperceptible logistics level” in all our lives. When it lays out future setups according to its Cipher method, it all sounds so realistic.
In another example, it predicts that drones will lead to the end of skyscrapers, as overhead space becomes more appreciated for communication than for constructions. Cities that have room to accommodate what it calls ‘landscapers’ long, single-storey buildings without the height that would affect drone traffic – will exceed overcrowded places like New York city.
There is no any company which is to venture beyond red oceans only to find itself in a slick. Now, the query is, how do you expand the size of the blue ocean? This eventually takes us to the third principle of blue ocean strategy- Reach beyond existing demand. This is a key constituent of achieving value innovation. By aggregating the greatest demand for a new offering, this approach attenuates the scale risk related with creating a new market. To achieve this, companies should challenge two predictable strategy practices. One is the focus on remaining customers. The other is the drive for better segmentation to lodge buyer differences.