The following article aims to publicize in a clear and understandable way what the Ocean Blue Strategy is for, which was conceived by W. Chan Kim and Renée Mauborgne, who propose a strategy that is not based on Destructive competition between companies, on the contrary, seeks to broaden horizons, with innovation as a point of support.
Knowing key concepts that are immersed in this knowledge, knowing the antecedents, as well as vestiges, for this to know the innovation process with value, through the scheme of four actions.
A basic comparison between the strategies of the Red Ocean and the Blue Ocean. As well as knowing the panorama that a Blue Ocean has.
Keywords
Balanced scorecard, canvas model, ERIC scheme
Today we live in a competitive world, where there are many options for products and services, where most companies compete fiercely to expand their presence in the market, and thus have consumer preference, due to which it is a fight. fierce, where some competitors choose aggressive strategies.
Make a transition from the cataloged Red Sea where competition is fierce, to a blue Sea, where the competitor is no longer a reason for concern, consolidation, growth and leadership will be a guarantee for those who manage to reach their immensity.
Key concepts
Canvas Model.- The Canvas Method or as it is known worldwide the “Business Model Canvas” was initially created as thesis of Alex Osterwalder's doctorate, as every restless young man uploaded this document to the Internet and began to have many downloads and a telecommunications company Colombia adopted the methodology and invited him to give a course on this topic, and it is there that Osterwalder realizes that this proposal was very well received and the best was sustainable for companies. (Quijano, 2013)
The Canvas Method consists of putting nine essential elements of companies on a canvas or table and testing these elements until a sustainable model is found in VALUE to create a successful business, it is part of the "Lean Startup" methodology that together with the Minimum Viable Product they put at your hand very simple tools to prove what may be the most viable product or service for growing companies. The Canvas Method seeks with a comprehensive model to analyze the company as a whole and serve as the basis for developing different business models, it has become a tool for Strategic Innovation. (Quijano, 2013)
Background
In his article (Ogliastri, 2010) he exposes: During periods of crisis, many companies find their way out through a change in the business model in order to serve a broad mass of new consumers, to reorient their strategy towards spaces free of competition., to increase the value customers receive while incurring a lower cost for the company. … What Kim and Mauborgne have called moving from the red ocean (with the water stained red by the blood of fierce competition between companies) to a blue ocean where there is no competition.
A fairly acceptable and punctual expression is that expressed by (Cervilla & Puente, 2010) Innovating in value implies opening a new and unknown space in the market. In these spaces, companies must reconstruct the elements of value for the buyer that are beyond the borders of the industry. In uncertain environments, the most prosperous businesses can develop, but only the most daring ones launch into the blue oceans.
Traces
In his work (Becker, 2006) he comments that The Blue Ocean Strategy was developed from the analysis of 150 companies in the last 100 years and the establishment of common characteristics in the evolution and reasoning of these organizations when creating new markets from existing markets or developing new markets for what Kim and Mauborgne define as "a market without rivals"
Although it is true that many of the basic principles of developing and implementing the concept of the Blue Ocean Strategy are mixed with the principles of traditional management strategy, such as gathering business intelligence that includes traditional scanning techniques. Like the PEST GO analysis and the use of the inverted pyramid analysis, the unique vision of the Blue Ocean is the methodology that allows an organization to go out and look for opportunities that exist or will exist, a methodology that is not currently exploited. (Becker, 2006)
First impressions
The first impression is that the EOA is a combination of differentiation and cost leadership to find niche markets, and thus incorporate with each other all the market sites defined by Porter. (Becker, 2006)
It expresses (Becker, 2006) that the unique vision of the Blue Ocean is the methodology that allows an organization to go out and look for opportunities that exist or will exist, a methodology that is not currently exploited. While most companies see themselves as proactive, in reality they only react to an event, as one anonymous executive put it well: "We want to be in a position to launch ourselves into any opportunity that appears."
In his work (Becker, 2006) he mentions that the strategic canvas is fundamental for the development of the blue ocean, since when used in coordination with the framework of the six paths, the Elimination, Reduction, Increase and Creation grid (ERRC), and the three levels of customer relationships (Kim and Mauborgne, 2005), an organization can develop EOA. The EOA uses the approach of developing a strategic canvas, an IMD map within an industry, and determines how an organization compares to the competition.
CANVAS Strategic
Strategic Canvas. (Kim & Mauborgne, The Blue Ocean Strategy: How to develop a new market where competition is of no importance, 2005)
The CMI was originally designed by Kaplan and Norton as a performance measurement system (Kaplan & Norton, 1996), as an extension of performance measurement systems made up exclusively of financial indicators such as Return on Income (ROI) and Return on Capital Employed (ROCE) to incorporate three other focal perspectives: customers, internal processes, and learning and development.
The WCC can align the organization's resources with the strategy, while the Blue Ocean Strategy can be used to create the corporate strategy. (Becker, 2006)
Innovation in value
Innovation in value becomes the cornerstone of the blue oceans strategy. For value innovators it does not matter how the rest of the industry behaves, as they are able to analyze and challenge the assumptions under which the industry operates, in order to create unknown spaces in the market. Innovating in value implies, both for buyers or clients and for the company, taking a qualitative leap that opens a new and unknown space in the market. (Cervilla & Puente, 2010)
Competitors' position and category. (Kim & Mauborgne, The Blue Ocean Strategy: How to develop a new market where competition is of no importance, 2005)
Basic tool for the transition from a Red Sea to a Blue Ocean
He cites (Ogliastri, 2010) that a basic tool is innovation in the value curve that is carried out using the ERIC scheme.
The value curve is initially constructed for the generality of the sector, and its structure shows the key factors of competition (price, design, quality, etc.). Each company has its own value curve, which is its proposal to consumers on the points in which it emphasizes and differentiates itself from the competition.
The first stroke to reach a "blue ocean" consists in carefully identifying these competition factors and critically studying their relative importance for all potential consumers, not only for current consumers but especially for those who are not currently consumers.
Each of the competition factors is reviewed with the ERIC scheme, which identifies four actions corresponding to its initial letter: Delete, Reduce, Increase and Create.
(Kim & Mauborgne, The Blue Ocean Strategy: How to develop a new market where competition is of no importance, 2005)
What competition factors are considered essential in the sector but do not really add value to the consumer? These should be removed or at least discarded any costs associated with them. What competition factors do not add significant value to the customer? These should be reduced in the value proposition of the company, starting with the price, which is usually reduced to accommodate those who do not use the product or service for price reasons.
What factors of the characteristics of the product or service should be increased well above the industry norm? These are the ones most appreciated by the mass of potential and current consumers, and may require some investments in which the value received by the consumer is less than the cost incurred by the company.
(Kim & Mauborgne, The Blue Ocean Strategy: How to develop a new market where competition is of no importance, 2005)
Differentiation of the Red Ocean Strategy and the Blue Ocean Strategy
The following is a comparison between these two types of strategies in force, which is aptly illustrated (Bocangel Weyder, 2012), in his presentation at a seminar in 2012 in the city of Lima, Peru, held within the facilities of the Universidad San Martin de Porres.
Comparison between Red Ocean and Blue Ocean
Future of the Blue Oceans
The blue oceans cannot be closed, so new vessels will enter, resulting in an increase and power of these ships.
For the previous sentence (Llanos, 2006) he obtained as an answer from W. Chan Kim and Renée Mauborgne in an interview:
It is true. Eventually, each blue ocean will attract competitors who try to imitate them and navigate it to enjoy the new market space. However, according to our research, it takes companies between ten and fifteen years to follow the same steps as others.
This is because there are significantly large barriers to effective imitation: some are operational, some cognitive, and so on. Although when the imitation occurs, the blue ocean will eventually turn red.
At that point, it is time for the company to start its search and create a new blue ocean, in order to maintain consistent and profitable returns.
Conclusions
Undoubtedly, this topic is very interesting, since it allows anyone who wants to venture into the business field, to look for alternatives to be able to compete in a market, and to position themselves, leaving aside the competition, offering a product of value for the Consumer, as entering the market directly, is a difficult fight to start, as the competitors are established, and is supported by numerous strategies.
It basically consists of having an innovative vision, which opens up a new field of opportunities, and that in due course established companies will want to be able to adopt, but which could not be implemented in a short time, since they have defined processes.
For those who wish to implement and / or change their strategy, it is something that will guarantee them a space in the market, without the competitors being a preponderant factor.
Bibliography
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