Recently Ive been hearing a lot of this Blue Ocean Strategy in my conversations with people and realized that it is fast becoming one of those business buzzwords that we would start hear too much of, just like Six Sigma, TQM and Kaizen. So, in order not to appear dumb whenever i hear that word again in a conversation I decided to do some research. So here is what i found out, so far…
Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant is a business book written by two INSEAD professors W. Chan Kim and Renée Mauborgne in 2005. It has since then become an international bestseller and is published in 37 languages.
The "ocean" refers to the market or industry. "Blue oceans" are untapped and uncontested markets, which provide little or no competition for anyone who would dive in, since the markets are not crowded. A "red ocean", on the other hand, refers to a saturated market where there is fierce competition, already crowded with people (companies) providing the same type of services or producing the same kind of goods.
Their idea is to do something different from everyone else, producing something that no one has yet seen, thereby creating a "blue ocean". An essential concept is that 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. The authors critique Michael Porter’s idea that successful business are either low-cost providers, or niche-players. Instead, they propose finding value that crosses conventional market segmentation and offering value and lower cost.
It seems that this new concept has been getting a lot of support. Like LG, for example who seems to be taking it very seriously:
Im thinking of buying the book. This really seems interesting. the phrase "Don’t Compete with Rivals—Make Them Irrelevant" sounds really cool!
Someday I should come up with a business buzzword of my own, borrowing from exsisting concepts and mixing them up together. Ill write a book about it and get rich from the royalties and international speaking engagements.
Next buzzword to learn… Business Scorecard.