What Is Blue Ocean Strategy?
The question that both old and new entrepreneurs are asking is: What is blue ocean strategy? Basically, the blue ocean strategy is a relatively new term coined by two renowned professors-W Chan Kim and Renee Mauborgne, who wrote the now famous book “Blue Ocean Strategy”. According to these two authors, the term blue ocean strategy generally means the new and uncontested space in the market. They argue that the best way to succeed in business is to create your own blue ocean strategy that makes your competitors irrelevant. This has, however, been the bone of contention among scholars most of whom argue that this strategy may lead to businesses ignoring genuine competition by believing their products or services are unique.
Nonetheless, majority of upcoming businesses seem to be adopting the blue ocean strategy by creating new and untested business frontiers, thus reducing competition as well as cost of running the business. As Kim and Mauborgne have highlighted in their book, the reason why most new investments don’t last long enough in this competitive business market is because they are imitations of what is already in existence. While it is possible for a company to stand out in a saturated market niche, the cost of achieving this is way too high. The blue ocean strategy defies the conventional way of doing business by enabling innovative entrepreneurs to break free from the traditionally accepted frontiers that dictate how businesses compete. It broadens an investor’s point of view, allowing them to see beyond these boundaries and to create their own blue ocean.
Another importance of adopting the blue ocean strategy is the fact that it gives you the authority to dictate your own terms and conditions. With the systematic structures and frameworks availed by the blue ocean strategy, you will find it extremely easy to avoid competition and develop your own unrivalled market space. While most marketing tools are principally focused on identifying strategies for competing within the established markets, the blue ocean strategy is predominantly aimed at providing avenues to the creation of new and uncontested markets where there’s minimal competition. Such frameworks allow you to create underlying logical strategies and methodologies through which you are able to exercise innovation to bring value to your business.
The blue ocean strategy provides you with a clear roadmap for systematically tracking value, creativity and developing uncontested market. With this strategy, it is quite easy to change your market basics for better value. The good thing is that this strategy offers a step-by-step procedure, allowing you to assess the current market situation and explore new paths to a less competitive market space. It will also help you to figure out ways to convert new customers into loyal customers. The strategy offers a well thought out four-step procedure to help you break free from competition and develop your own blue ocean, which guarantees you robust profitable growth. These four steps are designed using essential concepts and apparatus of the blue ocean strategy to ensure effectiveness and fairness. You and your team will be able to formulate sustainable strategies without losing the bigger picture.
According to Kim and Mauborgne, the blue ocean strategy maximizes opportunities while reducing risk. Although many may argue that almost every business strategy has its fair share of risks, the blue ocean strategy offers a strong mechanism through which you can mitigate risk. With the blue ocean strategy index, you can assess the commercial practicality of your uncontested market before you delve deeper into it. Through this assessment, you will learn which areas need to be refined to make the idea more viable and minimize risks.
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