1. The Blue Ocean Strategy
by: Kim and Mauborgne
Presented by: Evan Uy

2. Outline
• Introduction
• The Red Ocean
• Blue Ocean Tools and Frameworks
• Blue Ocean Principles
– Formulation
– Execution

3. Introduction
How to Create Uncontested Market Space and
Make the Competition Irrelevant
Break out of the red ocean of bloody
competition
The only way to beat the competition is to
STOP TRYING to beat the competition

4. Creating Blue Oceans
Value Innovation
- a LEAP in value
- EQUAL EMPHASIS on value and
innovation
- Innovation with Utility, price and cost
position
- simultaneously seeking
DIFFERENTIATION
and LOW COST

5. RED vs BLUE Oceans
Red Ocean Blue Ocean
Compete in existing market Create uncontested market space
Space
Beat the competition Make the competition irrelevant
Exploit existing demand Create and capture new demand
Make the value-cost trade-off Break the value-cost trade-off
Differentiation OR low cost Differentiation AND low cost

6. Blue Ocean
Tools and Frameworks

7. The Strategy Canvass
• Captures Current State of Play in the
Known Market Space
• Allows you to understand:
– Where the competition is investing
– The factors the industry competes on in
products, service and delivery
– What customers receive from existing
competitive offering on the market

8. Sample Strategy Canvas: US Wine Industry

9. Four Actions Framework
Which factors should be
REDUCED WELL BELOW
the industry’s standard?
Reduce
Which of the factors
New Which factors should be
That the industry takes
For granted should
Eliminate Value Create CREATED that the industr
Curve Has never offered?
Be ELIMINATED?
Raise
Which factors should be
RAISED WELL ABOVE the
Industry’s standard?

10. Sample Four Actions FM:

11. Sample Strategy Canvass:
-Focus
-Divergence
-Compelling Tagline

12. Blue Ocean Principles
Formulation Execution
• Reconstruct Market • Overcome Key
Boundaries Organizational Hurdles
• Focus on Big Picture, not
the Numbers • Build Execution into
• Reach Beyond Existing Strategy
Demands
• Get the Strategic
Sequence Right

13. Formulating Blue Oceans
1) Reconstruct Market Boundaries
• Look across ALTERNATIVE INDUSTRIES- NetJets
• Look across STRATEGIC GROUP within industry – German Car Diesel
• Redefine the industry BUYER GROUP– Pharmaceutical
• Look across COMPLEMENTARY PRODUCTS/SERVICE– Bookstore-Cafe
• Look across FUNCTIONAL or EMOTIONAL appeal to buyers – Self-cook
• Participate in EXTERNAL TRENDS over time – Healthy lifestyle

14. Formulating Blue Oceans
2) Focus on Big Picture, not the Numbers
• Visual Awakening
• Visual Exploration
• Visual Strategic Fair
• Visual Communication

15. Formulating Blue Oceans
3) Reach Beyond Existing Demand
How??
Target Non-customers!

16. Formulating Blue Oceans
3) Reach Beyond Existing Demand
Unexplored In distant markets from yours
Refusing
Consciously choose against
your market
Soon-to-be At the edge of your market
current

17. Formulating Blue Oceans
4) Get the Strategic Sequence Right

19. Executing Blue
Ocean Strategy

20. Executing Blue Ocean Strategy
5) Overcome Key Organizational
Hurdles
6) Build Execution Strategy

21. 5) Overcome Key Organizational Hurdles
Let managers experience
Harsh realities First Hand!
- Put resources from -Leverage your Angels;
Cold Spot to Hot Spots Silence you Devil
- Horse Trading -secure a consigliore in
top mgt
Zoom in on KingPins and put them in Fishbowl
Atomize to the org to change itself

22. 5) Overcome Key Organizational Hurdles

23. 6) Build Execution Strategy – Fair Process

24. Entrepreneurs CREATE Blue
Oceans

25. The End
Kim, W. Chan; Mauborgne, Renée. Blue Ocean Strategy: How to
Create Uncontested Market Space and Make Competition
Irrelevant. Harvard Business Press.