Blue Occean Strategy

Blue Ocean Strategy is a business strategy book written by Professors W. Chan Kim and Renee Mauborgne of INSEAD, a leading global business school, that promotes creating new market space or "Blue Ocean" rather than competing in an existing industry. It contains retrospective case studies of business success stories the authors claim were Blue Ocean Strategies. The book has sold more than a million copies in its first year of publication and is being published in 41 languages.

The concept

The metaphor of red and blue oceans describes the market universe. Red Oceans are all the industries in existence today—the known market space. In the red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. Here companies try to outperform their rivals to grab a greater share of product or service demand. As the market space gets crowded, prospects for profits and growth are reduced.

Products become commodities or niche, and cutthroat competition turns the ocean bloody. Hence, the term red oceans. Blue oceans, in contrast, denote all the industries not in existence today—the unknown market space, untainted by competition. In blue oceans, demand is created rather than fought over. There is ample opportunity for growth that is both profitable and rapid. In blue oceans, competition is irrelevant because the rules of the game are waiting to be set. Blue Ocean is an analogy to describe the wider, deeper potential of market space that is not yet explored.  The corner-stone of Blue Ocean Strategy is 'Value Innovation'. A blue ocean is created when a company achieves value innovation that creates value simultaneously for both the buyer and the company. The innovation (in product, service, or delivery) must raise and create value for the market, while simultaneously reducing or eliminating features or services that are less valued by the current or future market.

This is one of the best business books i have ever read on strategy. Happy reading!!!