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Who is the author of Blue Ocean Shift?

W. Chan Kim and Renée Mauborgne are the authors of Blue Ocean Shift.

Entrepreneurship

Blue Ocean Shift Book Summary - Blue Ocean Shift Book explained in key points

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Blue Ocean Shift summary

Name: Blue Ocean Shift
Rating: 4.4 (213 reviews)
Author: W. Chan Kim and Renée Mauborgne

W. Chan Kim Renée Mauborgne

Beyond Competing – Proven Steps to Inspire Confidence and Seize New Growth

4.4 (213 ratings)

24 mins

Brief summary

Blue Ocean Shift by W. Chan Kim & Renée Mauborgne is a management book that guides leaders to create new market spaces. It shows how to move from a red ocean of fierce competition to a blue ocean where demand is created.

Topics

Small Businesses Entrepreneurship Strategy

Table of Contents

Blue Ocean Shift
Summary of 10 key ideas

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Key idea 1 of 10

What’s in it for me? Venture out into the vast blue ocean of new markets.

If you’re working in a typical organization, you’re probably operating in a “red ocean” of overcrowded, fierce competition. But have you ever thought there could be a way to escape and move into a “blue ocean,” that is, away from competition?

Based on decades of the authors’ practical experience, these blinks show you how to venture out into new waters by making a blue ocean shift – that is, a shift from a competitive industry environment to new markets full of opportunities.

Start by learning a step-by-step framework and find out about a series of practical tools that can be used on any kind of organization to navigate into a brand-new, wide-open market.

You’ll also discover

how the market of french fry makers was revolutionized through a blue ocean shift;
how a red clown nose shaped the charity industry; and
how the luxury hotel chain citizenM made a blue ocean shift by eliminating the front desk.

Transcend competition with a blue ocean shift.

When choosing a business strategy, it’s important to decide which direction you want it to take, and most people assume your choices are limited to two: the value-driven path, along which your business expands through outstanding quality and service, and the low-cost strategy, through which your business endeavors to offer the best price among all its competitors.

Those two options are all well and good, but there’s a third strategy that can do much more. It’s called the blue ocean shift. The blue ocean shift is about taking your business beyond competition into markets that are entirely untouched.

Just take the example of Groupe SEB, a well-established French maker of small appliances like those that make french fries. One of the basic assumptions in this industry was that making french fries involved deep frying and using a great deal of oil. Nobody ever thought to challenge this idea, even though cooking in liters of oil is expensive, dangerous, messy and, of course, unhealthy.

But in 2006, Groupe SEB came out with the ActiFry, introducing a whole new way of making french fries that requires no frying and employs just a tablespoon of oil. ActiFry brought in new customers, opened up a brand-new market and positioned Groupe SEB as a global leader.

In other words, the essence of a blue ocean shift is moving from a market that’s pervaded by fierce competition, a so-called red ocean, into a blue ocean, a market that’s wide open and full of opportunity. Such a move might seem like a magic trick, but there’s a straightforward method behind it that abides by three key components.

First, you need a new blue ocean perspective that expands the horizon of your thinking; second, you need humanness along the way to motivate people into helping you make the shift of perspective; and third, you have to have the market-creating tools to transform that perspective into an attractive product.

However, these concepts are all very abstract. In the following blinks, you’ll learn all the nitty-gritty details of how this process works and how you can put it into action.

There are specific ways in which new markets are created.

So, a blue ocean strategy can transform your business. Before we dive into the new perspective, humanness, and market-creating tools of applying one, though, it’s useful to learn a bit of market creation theory. This way, you’ll understand why making such a shift works.

For instance, you might assume that markets are established when new ideas arise that are fundamentally better or new. But there are actually three more specific market-creating strategies.

Four traits guide the especially powerful perspective of a blue ocean strategist.

Alright, now that you know the basics of how markets are created, you’re ready to find your own blue ocean. The first step in doing so is to adopt a mind-set with seriously broad horizons.

For instance, consider the UK charity, Comic Relief. The charity industry is a prime example of a red ocean: there are 600 cancer charities in London alone. Nonetheless, Comic Relief instituted a blue ocean shift by fundamentally reconceptualizing the industry.

A human element is central to the blue ocean process.

Before explaining the tools that make a blue ocean shift possible, it’s important to examine a fundamental concept of the process as a whole: humanness. Humanness is essential, as it acknowledges the fears, insecurities and desire for dignity and purpose that people inevitably bring with them.

Humanness will provide your employees with a sense of trust in the blue ocean strategy as a tool for taking them and your organization to new and exciting places.

Assess your situation before embarking on your blue ocean journey.

Now, with the other two components – a perspective shift and humanness – set in your mind, your real journey to a big blue ocean begins. To set yourself up for success, it’s essential to learn five practical blue ocean tools, one at a time. The first is the pioneer-migrator-settler map.

This tool lets you assess your organization’s current products or services in a simple chart so that you know where you stand in your market. Best of all, it’s easy to set up. Your ultimate aim in developing this tool is to get an objective sense of your products and their value to a buyer. To do so, you simply need to divide them into three categories.

Plot your competitive value against that of your rival to get a clear picture of where you stand.

The second tool to launching a blue ocean approach is called the strategy canvas, a method designed to generate an overview of your current business strategy and the competitive drivers of your industry. To do so, the strategy canvas maps the competitive factors in your industry and how much value buyers derive from each of them.

More concretely, it’s a graph on which the horizontal axis indicates the main competitive factors within your industry, and whose vertical axis indicates the offering level of each factor from low to high. For an illustration of this, think back to the charity from an earlier blink. The factors of competition in that scenario could include the percentage of each dollar that goes to the cause and the costs incurred in fundraising.

Chart customer experience to make your product more accessible.

The third market-generating tool at your disposal is the ability to uncover hidden pain points, areas in your industry that hamper the popularity of your product or scare away potential customers.

For instance, in the United States, wine makes up just 15 percent of alcohol sales. Why is that number so low?

Use a simple framework to uncover vast opportunities.

The fourth tool in your blue ocean toolkit is called the six paths framework and it’s great for producing blue ocean opportunities.

The first path is to look over alternative industries; your goal in doing so is to determine why customers choose one industry over another. For instance, why do some people hire plumbers while others go to the hardware store?

Develop your blue ocean option by challenging assumptions through a series of questions.

So, the six paths framework helps you identify potential changes you can make. But to utilize these observations, you’ll need to distill them into clear options for blue ocean shifts. The tool to accomplish this is called the four actions framework and it’s the final leg of step four.

The basis of this framework rests on four questions and the actions that correspond to them. The first is: which factors does your industry take for granted that could just as easily be eliminated?

Bring in your top people, select your best blue ocean option and make your move.

By following the previous step, you’ll have developed several well-formulated options for a blue ocean shift. In this fifth and final step, your task is to pick the best one and put it into practice.

To do so, hold a blue ocean fair and invite the cream of the crop, bringing together a number of leaders from departments across your company. You should at a minimum invite the head of your primary unit as well as her top team, the heads of marketing, manufacturing, HR, finance, IT and logistics. You can even invite customers, partners and suppliers if you like.

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What is Blue Ocean Shift about?

Blue Ocean Shift (2017) is a step-by-step guide to moving past competition in an overcrowded industry. These blinks, based on decades of the authors’ practical experience, explain why you should endeavor to make competition obsolete and how you can open up whole new worlds of opportunity.

Blue Ocean Shift Review

Blue Ocean Shift (2017) is a thought-provoking book that challenges traditional business strategies and provides a roadmap for creating new, uncontested markets. Here's why this book is worth reading:

It offers a practical framework for identifying and seizing untapped growth opportunities, enabling businesses to break free from competition and create new blue oceans.
The book showcases numerous real-life case studies that demonstrate how companies successfully implemented blue ocean strategies, providing actionable insights and inspiration.
With its data-driven analysis and clear explanations, the book presents a compelling argument that challenges traditional thinking and offers a fresh approach to business innovation.

Best quote from Blue Ocean Shift

An organization that has the confidence to make the blue ocean shift but lacks the knowledge of how to get there is like a gambler.

—W. Chan Kim and Renée Mauborgne

Who should read Blue Ocean Shift?

Entrepreneurs, managers, CEOs and business leaders
Small business owners
Business scholars and theorists of competition and market strategy

About the Author

W. Chan Kim and Renée Mauborgne are professors of strategy at INSEAD and co-directors of the INSEAD Blue Ocean Strategy Institute. They co-wrote the 2004 international bestseller Blue Ocean Strategy. In addition to receiving numerous awards, they were also listed by Thinkers50 among the top three management gurus in the world.

Categories with Blue Ocean Shift

Entrepreneurship Management & Leadership

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