In the business world, there are many traps that managers of organizations fall into when trying to create and execute a blue ocean strategy. This strategy is about how can any company or organization rest outside of what is called the "red ocean" where competition is bloody and market space is existing, which tends to be always very crowded and is very competitive in these. days. It also creates an indisputable market space where competition is rendered irrelevant.
So the blue ocean strategy is really about creating unquestionable market space to align your earnings value proposition and people to achieve differentiation and low cost, thereby creating a win for the market, a win for the company, and a victory for its employees as well.
Blue oceans
“The blue oceans represent all the industries that do not exist today. In the unknown space of the market ”. (Kim & Mauborgne, Ocean Blue Strategy, 2005)
The smartest and most important strategic move of all is the creation of the blue oceans. Since to be successful in the future, companies have to stop competing with each other, they must stop trying to always beat the competition. You must leave your mark and create a company in which you can forge a future where everyone wins, both customers and employees, shareholders and society. The success of companies that implement blue ocean strategies is based on the fact that it is not about taking customers away from the industry but about creating new spaces in the face of the unknown market, where the competition always loses interest. It is more than anything about reinventing the market.
Creation of the Blue Ocean strategy
To create strategy, companies must accept the challenge of creating blue oceans blue oceans in an intelligent and responsible way, aimed at maximizing opportunities and minimizing risks. The opportunity to create blue oceans has always existed for businesses and the implementation market has grown as new opportunities are explored.
If we take a little look at history, we can see that most of the largest industries in the market are new, 30 years ago there were not all those telephone companies, automobiles, aviation, health care and many more. It is here where we realize where we find the implementation of blue ocean strategies.
Industries never remain static, but are always constantly evolving. Where operations improve, markets expand, and businesses come and go. Then we realize that it is always possible to create new companies and also reinvent those that already exist (Kim & Renee, Blue Ocean Strategy, 2004).
Blue Ocean strategy vs Red Ocean traps
One of the traps that the entrepreneur falls into when trying to implement blue ocean strategies is trying to focus on making existing customers happier, but it is confusing to understand why this turns out to be a problem, and the answer is that Creating new markets is not about better satisfaction of your current customers, but about creating a whole new demand, and the goal of creating new demand is to convince those who are not yet customers in the industry.
In the red oceans the boundaries of industries are defined and accepted and the rules of the game are known, they are the known market and they represent existing industries.
The blue oceans represent what does not yet exist or the unknown space in the market. They are defined as the market spaces that have not been used, where new demand and opportunities for great growth are created (HBR, 2015).
Organizations have the need to get out of the red oceans, out of the bloody competition that exists between them, but despite having the intention to do so, it often happens that they find that they are not successful in achieving that achievement.
Strategy execution
The creation of new markets is not the same as market differentiation, differentiation is really a position that economists call the productivity frontier, which is a range of the value of costs available to any company. Given the structure of the industry and the best knowledge of practices.
In order to improve the quality of success, we must study everything that allows us to make a mark and find a way to be able to repeat them systematically.
How the blue oceans are implemented will always be very important, as it will be crucial to the success of the organization, and always even more important to be careful not to get caught in the red ocean. Always looking for the best way to focus the strategy, will mark the success over the other companies in the industry.
Tools
The most important tool within the blue oceans strategy is value innovation, which is also called the cornerstone. This is a strategy where it does not revolve around victory over the competition but gives all the importance to achieve a qualitative leap in value for both buyers and the company, opening a new and unknown space in the market..
In value innovation, equal emphasis is placed on value as in innovation. Value is innovation usually remains at the level of the gradual creation of value, something that improves value but is not enough to stand out in the market (Hamel, 1998).
Organizational barriers
One of the biggest temptations is that in the red oceans it will always be more important to stay afloat thanks to beating rivals, but it is not something that is done in the implementation of the blue oceans strategy. Since companies must seek to go beyond competition, achieving new opportunities for growth and profitability, and can also create new oceans.
conclusion
The Blue Ocean strategy was created as a strategy that challenges companies to leave the bloody ocean that is made in the competition and to create safe spaces in the market where competition no longer matters, as the strategy did. of Cirque du Soleil by creating a totally different market in which customers were not taken away from other companies, but a totally different market was created. Instead of the demand being distributed and compared with the competition.
Bibliography
- Hamel, G. (1998). Opinion: Strategy Innovation and the Quest for Value. MIT Sloan Management Review, 2-8.HBR. (2015). Blue Ocean Strategy and Red Ocean Traps. Harvard Business Review, 1-12. Kim, WC, & Mauborgne, R. (2005). Ocean Blue Strategy. Boston: Elsevier. Kim, WC, & Renee, M. (2004). Blue Ocean Strategy. Harvard Business Review, 1-17.
Thesis topic:
"Investigation of new fields of implementation of strategies for the increase of the company's market"
Objective:
Implement research strategies to determine new fields of development of a certain company, where competition does not take place.
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