Which of the following is a simple but powerful method for strategizing about a business?

BLUE OCEAN STRATEGY is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. It is based on the view that market boundaries and industry structure are not a given and can be reconstructed by the actions and beliefs of industry players.

WHAT ARE RED OCEANS AND BLUE OCEANS?

In their classic book, Blue Ocean Strategy, Chan Kim & Renée Mauborgne coined the terms ’red ocean’ and ‘blue ocean’ to describe the market universe.

RED OCEANS

RED OCEANS are all the industries in existence today – the known market space. In red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known.

Here, companies try to outperform their rivals to grab a greater share of existing demand. As the market space gets crowded, profits and growth are reduced. Products become commodities, leading to cutthroat or ‘bloody’ competition. Hence the term red oceans.

RED OCEANS

BLUE OCEANS

BLUE OCEANS, in contrast, denote all the industries not in existence today – the unknown market space, untainted by competition. In blue oceans, demand is created rather than fought over. There is ample opportunity for growth that is both profitable and rapid.

In blue oceans, competition is irrelevant because the rules of the game are waiting to be set. A blue ocean is an analogy to describe the wider, deeper potential to be found in unexplored market space. A blue ocean is vast, deep, and powerful in terms of profitable growth.

BLUE OCEAN STRATEGY VS RED OCEAN STRATEGY

Learn the key differences between red ocean and blue ocean strategy.

Compete in existing market space

Make the value-cost trade-off

Align the whole system of a firm's activities with its strategic choice of differentiation or low cost

Create uncontested market space

Make the competition irrelevant

Create and capture new demand

Break the value-cost trade-off

Align the whole system of a firm's activities in pursuit of differentiation and low cost

© Chan Kim & Renée Mauborgne. All rights reserved.

MEET THE AUTHORS

#1 Management Thinkers in the World

Chan Kim and Renée Mauborgne

are Professors of Strategy at INSEAD and authors of The New York Times Bestseller Blue Ocean Shift and the 4 million global bestseller Blue Ocean Strategy. In 2019, Chan Kim and Renée Mauborgne were named the #1 Management Thinkers in the World by Thinkers50.

MEET THE AUTHORS

#1 Management Thinkers in the World

Chan Kim and Renée Mauborgne

are Professors of Strategy at INSEAD and authors of The New York Times Bestseller Blue Ocean Shift and the 4 million global bestseller Blue Ocean Strategy. In 2019, Chan Kim and Renée Mauborgne were named the #1 Management Thinkers in the World by Thinkers50.

KEY POINTS OF BLUE OCEAN STRATEGY & SHIFT

The fundamentals that will jump-start your strategy development process.

It’s grounded in data

Blue ocean strategy is based on a decade-long study of more than 150 strategic moves spanning more than 30 industries over 100 years.

It pursues differentiation and low cost

Blue ocean strategy is based on the simultaneous pursuit of differentiation AND low cost. It is an ‘and-and’ not an ‘either-or’ strategy.

It creates uncontested market space

Blue ocean strategy doesn’t aim to out-perform the competition. It aims to make the competition irrelevant by reconstructing industry boundaries.

It empowers you through tools and frameworks

Blue ocean strategy offers systematic tools and frameworks to shift from red ocean of competition to blue oceans of new market space.

It provides a step-by-step process

From assessing the current state of play in an industry, to exploring the six paths to new market space, to understanding how to convert noncustomers into customers, blue ocean strategy and shift provides a systematic process to create your blue ocean.

It maximizes opportunity while minimizing risk

Blue ocean strategy allows you to test the commercial viability of your ideas and shows you how to refine your ideas to maximize your upside while minimizing downside risk.

It builds execution into strategy

The process and tools are inclusive, easy to understand and visual – which makes the process non-intimidating and an effective path to building execution into strategy.

It shows you how to create a win-win outcome

As an integrated approach, blue ocean strategy shows how to align the three strategy propositions – value, profit, and people – to create a win-win outcome. Blue ocean shift builds humanness into the process to build people’s confidence to own and drive the process.

BLUE OCEAN STRATEGY TOOLS AND FRAMEWORKS

Put these practical market-creating tools into practice.

Learn how to put these practical market-creating tools into practice to move from red ocean of competition to blue oceans of new market space and to do so in a way that people own and drive the process.

READ THE BOOKS

The books that changed the way we think about strategy.

READ THE BOOKS

The books that changed the way we think about strategy.

Blue Ocean Strategy

The origin of the terms red and blue oceans comes from Blue Ocean Strategy – How to Create Uncontested Market Space and Make the Competition Irrelevant.

Recognized as one of the most iconic and impactful strategy books ever written, Blue Ocean Strategy argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool.

It presents a systematic approach to making the competition irrelevant and outlines principles and tools any organization can use to create and capture their own blue oceans.

The books have collectively sold over 4.5 million copies worldwide. 

Learn the essentials of blue ocean strategy and shift created by #1 Management Thinkers in the World.

For anyone tired of competing head-to-head and wanting to seize new growth.

BLUE OCEAN STUDIO™

Powerful tools to create your business strategy

Follow a guided process for new market creation, build innovative business models, and transform your business within our interactive workspace.