The previous section examined the challenges faced by industry leaders when strategic innovation emerges, and analyzed their possible reactions to the use of radically new management models by innovative organizations that lead to significant changes in the industry, the redistribution of forces and the position of organizations operating in the industry market.
And can the theory of strategic management give recommendations, help to find an effective approach to the development of strategic innovations?
Until recently, it was almost impossible to find formalized approaches to the development of strategic or radical managerial innovations. The search and development of a new "formula for success" was considered as an art, i.e. unformalizable, largely irrational activity based on to a large extent on implicit knowledge. In other words, the theory of strategic management could not actually offer practicing managers specific methods and tools that could help them successfully develop strategic innovations.
One of the first theoretical attempts to propose an instrumental approach to the development of strategic innovations is the concept of a blue ocean strategy, set out in the work of Chan Kim and René Mauborgne "Blue Ocean Strategy" 1 .
Usefulness of this concept for managers non-profit organizations largely due to the fact that the methods proposed by its authors help create greater customer value, develop innovative services, which as a result leads to improved strategic position organizations.
Let us consider in more detail the main provisions, methods and recommendations contained in the blue ocean strategy concept.
The traditional approach to conducting strategic analysis is aimed at identifying industry markets that are attractive to a given organization (see paragraph 4.1). This task remains very relevant for many organizations. However, there are many examples where organizations have achieved impressive success in seemingly unattractive from the point of view of strategic development or even withering industries. As examples of this kind, Ch. Kim and R. Mauborn cite the Canadian company Cirque du Soleil from the circus industry, an American company Bames&Noble in the bookselling, Japanese company Quick Beauty House in the hairdressing industry, etc.
The success of these organizations is based on strategic innovations, which not only led to the formation and development of a new business model, a new “formula for success”, but actually allowed the creation of new markets, which, according to the figurative expression of Ch. Kim and R. Mauborgne, were called "blue oceans".
The scarlet oceans, in their opinion, symbolize all that exist on this moment industry markets. This is the definition they give to the existing market space, because they emphasize that "ruthless competitors cut each other's throats, filling the ocean with blood" . Naturally, the scarlet oceans, i.e. competitive markets will not lose their significance and will always remain a fact of business life;
blue oceans denote those industry markets that do not yet exist today, these are still undiscovered and unknown market spaces. Although most blue oceans originate inside scarlet ones, their peculiarity and difference lies in the fact that organizations that have broken into the blue ocean are actually out of competition, they are free from it, since the new market spaces they create are still free from competitors.
Thus, the metaphor of two oceans, which received in the theory and practice of strategic management in recent times widespread, focuses on the emergence of new markets or the expansion of the boundaries of old ones as a result of the successful development and implementation of strategic innovations.
The strategy leading to the creation of blue oceans, C. Kim and R. Mauborgne called the strategy of blue oceans (CGO - BOS - Blue Ocean Strategy). It is important to note that this type of strategy can only be pursued by innovative organizations that are capable of not only developing innovative services or innovative technologies but also to create and implement an innovative business model, i. an innovative management model leading to a new formula for success, or strategic innovation.
As noted above, this concept deserves special attention, since its authors proposed a management toolkit to help develop new business models or strategic innovations. This means that, unlike many schools of strategic management that offer irrational, non-instrumental approaches to the strategic management of innovative organizations, Ch. Kim and R. Mauborn in their concept developed practical schemes and analytical tools “for the systematic search for blue oceans and their conquest” , i.e. offer a set of methods to help develop new business models that lead to new segments or even new industry markets. In other words, they develop an instrumental approach to the strategic management of innovative organizations.
The strategic logic of this concept aims to create value innovation, which is the cornerstone of the blue ocean strategy. The authors note: “We call it value innovation because instead of focusing all your efforts on fighting competitors, you make competition unnecessary by creating such a jump in value for customers and for the company that thereby opens up a new, uncompetitive space. market" 1 . The authors emphasize that value innovation avoids a trade-off between value and costs, allows you to simultaneously achieve both differentiation (i.e., improvement of certain product properties) and cost reduction.
As an illustration of how a value leap is achieved for both the organization and consumers, consider the example of a circus company. Cirque du Soleil, comprehensively analyzed in the work of Ch. Kim and R. Mauborn. The innovative business model of this company, breaking the market boundaries between theater and circus, brought circus fun and entertainment to the audience, plus the intellectual depth and artistry of the theater. Company Cirque du Soleil took a fresh look not only at the circus visitors, but also at the so-called "non-clients", i.e. those who usually do not go to the circus - adults, theater lovers. Managers Cirque du Soleil, found that the traditional appeal of the circus comes down to three main factors: the marquee, the clowns, and classic circus acts such as acrobatic stunts, performances by motorcyclists. Therefore, it was decided to keep, but ennoble the tent (while many circus companies, abandoning the tent, began to move on to renting premises). Besides, Cirque du Soldi strove to make circus humor from the "square" more sophisticated. The acrobatic and other acts remained, but non-circus elements were introduced, such as the storyline, intellectual richness, and artistic music and dance that were taken from the theater and ballet industry.
At the same time, the company abandoned many expensive circus elements (such as performances with animals, which require not only training, but also medical care, special transportation, etc.), which made it possible to drastically reduce costs. This approach allowed the company Cirque du Soleil bring ticket prices closer to theatrical ones, which are several times higher than the price level in the circus industry. But these prices turned out to be very attractive to an adult audience accustomed to theatrical prices. This business model of the company Cirque du Soleil allowed to systematically coordinate customer value, prices and costs, and as a result - to achieve a jump in value for both consumers and the company.
Value innovation is achieved when there is a reduction in costs by eliminating or reducing the factors on which there is competition in a particular industry, and increasing customer value by creating or developing elements that have never been offered before in this industry.
This allows Ch. Kim and R. Mauborgne to conclude that the main objective of the blue ocean strategy is reconstructionist, destroying the trade-off that has developed in the industry between customer value, the growth of which is achieved through service differentiation, and organizational costs. Note that the reconstructionist view of strategy is based on the theory of endogenous growth, i.e. initiated internal factors, in contrast to the structuralist view, which assumes that strategic changes are initiated by factors that are external to market structure(see paragraph 1.3).
Let us consider the main analytical tools and models described and systematized by the authors of the blue ocean strategy concept.
Central to the development of value innovation and the pursuit of a blue ocean strategy is an analytical model called the "strategy canvas".
Strategy canvas (Strategy Canvas) - This is a graphical tool that allows you to visualize strategic profiles ( strategic profile), specific to this industry market. Understanding and interpreting existing strategic profiles creates the basis for developing an innovative value curve (value sieve) or value innovation.
In other words, a strategy canvas is a graph whose x-axis reflects the main factors that compete in a given industry market; on the y-axis - the levels of these factors for individual strategic groups. On fig. Figure 6.3 provides an example of a strategic canvas for the two main strategic groups in the circus industry (small regional circuses and market leaders - companies Ringling Bros. and Bamum&Bailey) which graphically describes business models in the circus industry prior to the development of a strategic innovation by a company Cirque du Soleil.
Rice. 6.3.
industry
The strategy canvas allows you to take a holistic look at the profiles of competing strategic groups in an industry and develop a different value curve from them, i.e. reconstruct the elements of customer value.
It is important to note that the value curves of the two main strategic groups of the circus industry (small regional circuses and market leaders) look almost the same. In fact, the difference between them lies only in the height of the offer received by customers for all the main factors of competition. This indicates the similarity of the business models that they adhere to.
Strategic innovation leading to value innovation, i.e. to a strategic profile that is fundamentally different from the existing ones, involves a shift in the strategic focus from existing competitors to alternatives and non-customers. This makes the logic of blue ocean strategy very different from the traditional strategic logic of finding better solutions to problems within a given industry than competitors.
In order to reconstruct the value curve and create a fundamentally new strategic profile and, accordingly, a new business model, Ch. Kim and R. Mauborn suggest using the second analytical tool - the four-action model.
(The Four Action Framework) aims to find answers to four basic questions that are necessary to develop an innovation value curve (Fig. 6.4):
Rice. 6.4.
- 1) what factors that the industry takes for granted should be eliminated ( eliminate)? This question makes you think and identify factors that have already lost value for the consumer, but organizations, sometimes overly carried away by competitive benchmarking, do not respond to these changes;
- 2) what factors should be significantly reduced ( reduce) compared to current industry levels? The answer to this question leads to an understanding of which factors turned out to be overestimated or which product characteristics are very complicated (which often happens when you want to surpass competitors in differentiation, i.e., strengthening individual product properties);
- 3) what factors should be significantly increased (raise) but compared to current industry levels? The answer to this question leads to an understanding of what restrictions should be abandoned, providing consumers with new opportunities;
- 4) what new factors that have not been previously proposed in this industry should be created ( create)? The answer to this question involves the identification of completely new sources of value for consumers, the formation of new demand.
Answers to the first two questions (about eliminating and reducing factors) reveal ways to reduce costs compared to competitors. The next two questions allow you to realize ways to add value to consumers, create new demand.
The results obtained on the basis of the four forces model serve as the basis for applying the following analytical tool - abolish-reduce-raise-create grids (ERRC Grid - The Eliminate-Reduce-Raise-Create Grid). This tool aims to develop strategic steps to create a new value curve. In other words, the Eliminate-Decrease-Increase-Create grid is a four-cell matrix containing four types of specific steps formulated by managers to eliminate, reduce, increase, and create, respectively, the factors that determine the new value curve and value innovation. These steps allow managers to reverse-engineer value elements to offer the customer new opportunities while keeping costs low.
Let's take an example of the "reduce-reduce-increase-create" lattice corresponding to the new business model of the company described above. Cirque du Soleil(Fig. 6.5).
Rice. 65.
Cirque du Soleil 1
The result of such strategic moves is a new value curve, a different strategic profile from competitors, which is reflected in the company's strategy canvas. Cirque du Soleil(Fig. 6.6).
Rice. 6.6. Company strategy canvas Cirque du Soleil
Creating a unique, groundbreaking value curve allows you to successfully implement a blue ocean strategy or, in other words, successfully implement a strategic innovation. At the same time, the authors of the blue ocean strategy concept identify three characteristics that determine the success of this strategy:
- focus(focused nature of the value curve) - if there is no focus, i.e. the organization invests resources in all factors in a row, disperses efforts across all key factors competition, then it becomes very dependent on the steps of competitors, and its business model will be characterized by high costs;
- divergence - the value curve of the organization must be significantly different from the value curve of other players; this leads to the uniqueness and proactive nature of the strategy;
- attractive motto allows you to convey a clear and clear message, contains truthful advertising, without which consumers may lose interest in the organization.
Ch. Kim and R. Mauborgne formulate six basic principles that organizations should follow in the process of developing and implementing a blue ocean strategy to create value innovation.
Principle 1: reconstruct the boundaries of the industry market. The authors of the concept rightly point out that “managers cannot afford to be like gamblers from a river boat and bet on strategy, using only their own intuition and relying on chance” 1 . In order to formalize the process of reconstruction of the industry market, they identify six typical ways to carry out such reconstruction, i.e. six main approaches to reconstructing the boundaries of markets in order to “break out of the world of competition and create a blue ocean”:
- 1) consider alternative industries. The importance of this method is justified by the fact that most often it is the space between alternative industries that makes it possible to implement value innovation. Here it is important to note the difference between the concepts of "substitute" and "alternative". Goods / services that have a different appearance, but perform the same functions and satisfy needs of the same nature, are called substitutes. Alternative products differ in both appearance, and in terms of their functions, but serve the same purpose. For example, if the goal is to have a good vacation, then alternative products might be a resort tour and a summer school program from a top business school. It is worth noting here that in practice, the separation of the concepts of “substitute” and “alternative” is not always unambiguous, since it is not always possible to strictly distinguish between the consumer’s goal and the function that is implemented using this product. For example, is improving the image a goal or a function implemented with the help of this product?
- 2) consider the strategic groups of an industry: creating a new value curve (i.e. penetrating the blue ocean) can be done not only by considering alternative industries, but also by carefully examining the various strategic groups in a given industry. Section 4.1 defined a strategic group and emphasized that organizations tend to closely scrutinize the players in their strategic group who are their closest competitors, but other strategic groups are not usually closely monitored. C. Kim and R. Mauborgne note: “The key to creating a blue ocean through existing strategic groups is to discard these narrow views and understand what factors influence the decision of customers making a choice between several groups and turning to less or more expensive suggestions". The company is given as an example Curves engaged in fitness for women. This company built its blue ocean around the core strengths of two strategic groups operating in the US fitness industry, such as traditional health clubs and home exercise programs (based on videos, magazines, books), and eliminated or reduced other factors. In clubs Curves instead of special complex training systems, simple, easy-to-use and safe simulators are placed, there are no saunas, SPA-procedures, swimming pools, food and even locker rooms, no mirrors and no men. All this not only significantly reduces the cost, but also creates a convenient and comfortable environment for women who want to work on their figure and chat in the relaxed atmosphere of a club located close to home or work. Company motto Curves: "Spending a day no more than a cup of coffee costs, you can gain health by doing the right exercises." The implementation of such a strategy allowed the company to achieve such growth that on average every four hours a new establishment of the company opens in the world. curves",
- 3) look at the chain of buyers: in order to reconstruct the boundaries of the industry market, all groups of buyers should be carefully studied. Indeed, the main purchase decision can be made not only by the user himself, but also by a certain category of people “influencing”. For example, in the pharmaceutical industry, many companies target physicians who influence drug purchases. Consumer buyers and influencers often have very different definitions of value. Therefore, it is necessary to carefully consider the entire chain of actors that make a purchase decision and influence this decision. This creates the basis for revisiting the traditional view of the target customer, which allows the organization to shape and propose new value. An interesting example in this regard is the Danish company novo nordisk, which has evolved from a manufacturer of insulin to a manufacturer of products that make life easier for diabetics. Focusing not on doctors but on diabetic patients, the company set out to alleviate the problems associated with the need to inject insulin several times a day. As a result, the company began to produce not just insulin, but also NovoPen- the first user-friendly insulin injection device;
- 4) consider complementary products and services: it is important to understand what the overall solution is that a customer wants to find when purchasing a particular product. This helps identify additional products and services that add value to customers. To do this, it is recommended to ask the question - what happens before, during and after using this product?
- 5) analyze the functional and emotional attractiveness of the product / service for the buyer. Ch. Kim and R. Mauborn identify two components of the attractiveness of a product / service for the buyer - functional, based on the functions being implemented, and emotional, basic on the feelings of the buyer. This allows them to make the following recommendations for expanding the market space and reconstructing the boundaries of the industry market: “Emotionally oriented industries offer a lot of different options for their products, which increase the price, but do not functional qualities. If these options are discarded, then a much less complex, less costly, and less costly business model can result ... Conversely, industries focused on functional attractiveness can often breathe in consumer goods new life by adding emotional appeal to them, and thereby able to stimulate new demand” 1 ;
- 6) peer into the future: among the many constantly observed trends (for example, the rapid development of technology, changes in lifestyle, legislation, etc.), as a rule, according to the authors of the concept, one or two trends have a significant impact on a particular business. It is important to identify these trends and actively participate in shaping them over time.
Principle 2: focus on the big picture, not the numbers. With this principle, the authors of the concept of the blue ocean strategy actually emphasize the importance of not only the content of the strategy, but also the strategic process itself. They note: “It is not uncommon for managers to openly or silently express dissatisfaction with the existing strategic planning - the basis of any strategy. In their opinion, strategic planning should be more about collective work on the problem, and not about the transfer of plans from top to bottom or from bottom to top. They believe that the process should proceed through discussions, not through the transfer of documents, and the aim should be to create a big picture, and not to exercise with numbers. Planning should contain elements of creativity, not be based solely on analysis, it should be motivating, capable of generating a sincere commitment among employees to the chosen course, not reduced to bargaining and compromises regarding the further implementation of what was planned. Thus, it is emphasized here that the analytical tools of strategy development are important, but their result only creates the basis for the creative activity of managers to create a successful strategy.
As Aristotle aptly remarked, “thinking requires an image.” According to C. Kim and R. Mauborn, the disclosure of the creative potential of managers is facilitated by the visualization of the strategy. They identify four steps/stages in the strategy visualization process (Table 6.4).
Table 6.4
The Four Stages of Blue Ocean Strategy Visualization 3
- 1 Kim W. C., Mauborgne R. Blue ocean strategy. S. 71.
- 2 Ibid. S. 102.
- 3 Ibid. S. 87.
The end of the table. 6.4
|
1. Visual compulsion |
2. Visual examination |
3. Visual Strategies Fair |
4. Visual communication |
|
See what needs to be changed in your strategy |
-> Highlight the clear benefits of alternative products and services |
-> Get feedback from your customers, competitors' customers, and non-customers regarding alternative strategy canvas options |
-> Only support projects and steps that allow your company to update the new strategy |
|
-> See which factors should be abolished, created or changed |
-> Use feedback to build the optimal “required” strategy for the future |
Of interest are the recommendations that are given for the implementation of the third stage - the visual fair of strategies, which the authors came to on the basis of practical experience in building strategies in various organizations. For example, in one organization that successfully developed a new strategic profile that allowed it to break out into the blue ocean, the first two stages took about two weeks. After repeatedly drawing and redrawing various possible organizational strategy canvases, several of the most interesting and promising options were showcased at an event called the Visual Strategy Fair. Top-level managers, representatives of external contractors of the organization, including clients, acted as spectators at such presentations. Each value curve was given no more than 10 minutes to present, because it was believed that “an idea that takes more than ten minutes to present is too complex and will not be useful.” Then all participants evaluated the presented options for a new strategic profile of the organization. At the same time, the process of evaluation, or judging, was very simple and transparent: all participants were given a certain number of self-adhesive sheets (each sheet was actually equal to one evaluation point). Voting was carried out by sticking the appropriate number of sheets on posters with images of options for the strategic profile (strategic canvas).
Note that if at the level of a business unit (or mono-organization) the visual stimulation of strategy development is carried out using a strategic canvas, then at the level of a diversified organization (i.e. for corporate strategy) it is proposed to use the map of the pioneer-migrant-colonist (Fig. 6.7). The pioneer settler-settler map (PPC) proposed by the authors of the blue ocean strategy concept is actually a variation of the business portfolio matrix of a diversified company (see Section 5.2). As the main task that the PPC map helps to solve, the assessment of the growth potential of a diversified organization is considered.
Rice. 6.7.
organizations
"First movers" refers to business units that offer unparalleled, innovative value, i.e. these are business units that implement a blue ocean strategy, and therefore promise significant growth in the future. Their value curve is very different from that of other organizations. In contrast, "colonists" are business units that play by the rules that dominate the industry market. Their strategies are predominantly imitative and business models similar to the business models of other players. Colonists are generators of income for the organization today, but do not promise tangible growth in the future. An intermediate position is occupied by business units called "settlers". They offer above average value but are not innovative.
C. Kim and R. Mauborn suggest that the management of organizations strive to shift the balance in the future portfolio of business units in favor of the "pioneers". Obviously, such a recommendation is aimed at increasing the innovativeness of diversified organizations.
Principle 3: go beyond existing demand. Following this principle, according to the authors of the concept of the blue ocean strategy, allows us to understand how it is possible to achieve the maximum size of the new market space created by the organization, or the blue ocean?
When looking for an answer to this question, you should first pay attention to the following feature: the stronger the competition, the higher the individualization of the proposal, as a rule. This means that traditional strategic practices in competitive markets (i.e. in red oceans, using the terminology of the CGO concept) tend to focus on existing customers and increase market segmentation and, as a result, individualization of the offer.
The strategic logic of organizations creating a new market space (i.e. reaching the blue ocean) is usually reversed. C. Kim and R. Mauborgne conclude: “Instead of focusing on customers, they should look towards non-customers. And instead of focusing on the differences between customers, you need to build a strategy based on the common things that most buyers appreciate. ” In other words, when creating a new market space, it is recommended to first look for similarities and only then differences in consumer demands, first think about desegmentation, and only then about more advanced segmentation.
- 1) the first tier (closest to the original industry market/quasi market) includes customers who minimally use the goods/services offered in this industry market, but do not consider themselves to be its customers. If they are offered a new, increased value, then they will stay and more often begin to purchase services / goods;
- 2) the second tier of non-customers includes consumers who considered the offer of this industry market as possible option, but decided to abandon it;
- 3) consumers, who belong to the third tier of non-customers, have never considered the offer of this industry as an option of interest to them.
It is important to focus not on the differences, but on the key similarities between these types of non-customers. This may allow increasing the size of latent demand.
Principle 4 define a strategic sequence and follow it. The implementation of the above principles allows you to develop a strategic outline, i.e. formulate a blue ocean strategy, and identify ways to attract a growing range of consumers. This, according to the authors of the CGS concept, allows us to move on to the task of creating a sustainable management model (business model). As key principle when creating a business model, compliance with the following strategic sequence is considered (Fig. 6.8).
The first step in this sequence is to make sure that your strategic intent contains a viable idea of delivering exceptional value to consumers. In their quest to deliver exceptional value to consumers, many organizations fall into the technology trap. Technical improvement of products does not necessarily mean an increase in perceived consumer utility. There are many examples of marvels of technology appearing on the market that performed such a variety of new functions that consumers could not understand why and how to use them. In other words, value innovation is not equivalent
Rice. 6.8.
blue ocean
valence technological innovation. As a tool to help managers create exceptional utility for buyers, C. Kim and R. Mauborn offer a utility map (Table 6.5).
Table 6.5
Buyer Utility Carga 1
|
Six levers of utility |
The Six Stages of the Buying Cycle |
|||||
|
Acquisition |
Delivery |
Usage |
Additional |
Service |
Disposal |
|
|
Product purchasing power |
||||||
|
Simplicity |
||||||
|
Convenience |
||||||
|
Entertainment and image |
||||||
|
Environmental friendliness |
||||||
1 Kim W. C. y Mauborgne R. Blue ocean strategy. S. 125.
Utility levers are those dimensions of a product that create exceptional value for the customer. With the help of this card, you can check a new idea for the possibility of creating an innovative utility proposal by painting it in separate cells of the card. If the content of the cells in your map and the map for other organizations have much in common, then it is unlikely that you are on the right track to create a new market space.
In the case of a positive answer regarding the exclusivity of utility, it is recommended to move on to the second - the establishment of a strategic price. Can the organization benefit by selling products at a strategic price, i.e. a price that attracts the masses target buyers and helps keep them? At the same time, it is important not to allow consumer utility to decrease due to the fact that high costs do not allow the producer to receive benefits at strategic prices. In other words, the cost side of the business model allows the organization to see the added value to the organization itself.
It is important to note here that at the third stage of the strategic sequence, i.e. when determining the target cost, it is recommended to start from an attractive price for the consumer, and not to assign it on the basis of adding the cost and profit. The proposed approach requires, as a rule, quite radical changes, rationalization of production processes and the introduction of innovations in the field of cost reduction.
But sometimes no amount of rationalization to reduce costs allows the organization to achieve the target level of cost. Then, in order to implement the blue ocean strategy, i.e. to create a new market space, one has to change the chain model of the industry. C. Kim and R. Mauborn give the following example, illustrating the possibility of changing the price model of the industry. When the first video cassettes with films appeared on sale, they cost about $ 80. Since no one was going to watch the same recording more than two or three times, there were very few willing to pay that kind of money. How could a manufacturing company make a profit if it applied the principle of strategic pricing (i.e., based on the cost of visiting cinemas when determining the price of video cassettes, and did not focus on lifetime ownership of the cassette, which means that it would have to sell cassettes for several dollars at costs exceeding this level)? The answer is no. However, the company Blockbuster dealt with this problem by reorienting the pricing model from selling videocassettes to renting them. The company made money by renting the same $80 cassettes over and over again. more money than if she were selling them.
The success of the SSS can be counted on if, even at the development stage, efforts are made to address possible problems associated with its implementation. The identification of such obstacles and the search for ways to overcome them is the content of the fourth stage of the strategic sequence proposed by the authors of the concept of SSS.
Principle 5: Overcome organizational obstacles.
Among the many factors that hinder the implementation of value innovation, the authors of the blue ocean strategy concept distinguish four main groups:
Cognitive obstacles associated with a lack of understanding of the need for change, the desire to maintain the status quo;
resource constraints. Because the larger the changes, the more resources they tend to require, changes to create value innovation often face resource barriers;
motivational barriers that arise when employees are not motivated to make changes;
Political barriers associated with opposition from those affected by the change.
It is argued that purposeful leadership plays an important role in overcoming emerging barriers. C. Kim and R. Mauborn note that the idea of purposeful leadership is borrowed from epidemiology and the theory of points of irreversible change. Purposeful Leadership is based on the fact that “in any organization, fundamental changes occur quickly when the beliefs and energy of a critical mass of people create an epidemic movement towards an idea” 1 . The main task at the same time is to give people on their own experience, and not "relying on numbers", to feel the cruel reality, thereby "to make changes in the mind of a person that this person will make solely of his own free will". At the same time, the opinion is expressed that in order to launch an epidemic movement of positive energy, one must not disperse one's efforts, but, on the contrary, concentrate one's efforts on working with the "head pins", i.e. with those who have the most influence in the organization.
Principle 6: build the implementation process into the strategy.
This principle means that, when developing a strategy, it is necessary to pay special attention to thinking through the mechanisms that contribute to the implementation of the blue ocean strategy. The authors of the concept emphasize that it is important to enlist the loyalty of employees and inspire them to voluntary cooperation. One cannot but agree with their opinion that many of the issues that arise in the implementation of the blue ocean strategy ultimately “reduce to the intellectual and emotional recognition of employees. Every employee emotionally seeks recognition of their value not as “ work force”, “personnel” or “human resources”, but as a person who is treated with respect and dignity and evaluated based on individual qualities, regardless of position in the hierarchy. In the intellectual plane, each individual seeks recognition of his ideas, he needs to be interested in his thoughts, carefully discuss them, and those around him would have a sufficiently high opinion of his intellect and would discuss their ideas with him.
In conclusion, it should be noted that the creation of value innovation, or the development of a blue ocean strategy, is not a one-time but a dynamic process. If successful, sooner or later there will be imitators - potential competitors. Therefore, the question arises of sustainability and renewal of the strategy aimed at creating value innovation.
As emphasized above, value innovation is a strategic innovation; radical managerial innovation. Therefore, its successful implementation and sustainable development must be accompanied by incremental, operational improvements. This allows a blue ocean organization to become a moving target, constantly moving away from imitators. However, if the value curve innovative organization becomes in many ways similar to the value curve of emerging competitors, then this is a signal that it is worth starting the creation of a new business model or opening up a new space for an industry market/quasi-industry.
- What is the essence of the blue ocean strategy.
- What are the main principles of the strategy.
- How to properly implement it.
- What does the implementation of the blue ocean strategy bring to the business.
- Which companies have already created blue oceans.
« CEO» tells what advice to entrepreneurs and company executives give the authors of one of the most popular business books of the XXI century about blue ocean strategy.
What is the blue ocean strategy
Kim Chan and René Mauborgne's Blue Ocean Strategy is one of the top business bestsellers of recent years. The publication of the text was preceded by a fifteen-year study of 150 company strategies over the past 120 years in 30 sectors of the economy.
Studies have shown that every year competition for various markets and in various industries becomes more tense and tough. As a result, low-profit markets began to be called the "red ocean".
The authors of Blue Ocean Strategy believe that high profitability and rapid growth are demonstrated by companies that are able to come up with something new by creating demand in a new market, that is, in the Blue Ocean. Blue oceans include all industries that do not yet exist today. There is no need to fight hard here. competition. At the same time, the pioneers of the blue oceans are not in danger of competition, and they can continue to develop through their own creative ideas.
At the heart of the blue ocean strategy is the concept of value innovation. According to this approach, blind infatuation innovation by itself will not be able to make the development of the company effective. Innovation must be inseparable from the value that a new product creates for consumers. At the same time, values without innovation close opportunities for brand differentiation.
Basic principles of the blue ocean strategy
The authors argue that there are no companies that will remain successful all the time. However, the strategies that have at various times led to the creation of blue oceans and profitability growth companies are remarkably similar to each other. Only those organizations that have pursued a value innovation strategy in their work, placing an equal emphasis on innovation and values, have been able to achieve real success.
What are the main principles of the blue ocean strategy? We will understand further in the text.
Reconstruction of the market boundaries
The first principle on which the blue ocean strategy is based is the reconstruction of market frontiers. The company must find the strength to go beyond the boundaries of the "red ocean" and create a new industry. At the same time, the authors of the book identify 6 ways to reconstruct markets:
- Exploring alternative industries.
- The study of the strategic groups of the industry.
- Buying chain analysis.
- The study additional services and goods.
- Analysis of the functional and emotional attractiveness of the product for the consumer.
- Study of current trends and market development forecasts.
How to find new promising market niches
In order to apply the blue ocean strategy for your business, you must first find an empty market niche. This process is quite complicated, so the editors of the General Director magazine have prepared for you a detailed algorithm for finding promising areas.
Focusing on the big picture, not the numbers
Compliance with this principle allows companies to significantly reduce the risks associated with planning. This approach is an alternative existing ways strategic planning. In accordance with it, the company should first of all develop a strategic outline that will help to better understand the goals of the organization and establish communications with employees. At the same time, the creation of a strategic canvas, according to the book, should consist of 4 stages:
- visual awakening.
- visual research.
- Visual Strategy Fair.
Going beyond existing demand
This principle will allow companies to expand the size of the blue ocean they create. Two traditional strategic practices that significantly reduce the effectiveness of the strategy should be abandoned - focusing on an existing client base and striving for market segmentation.
Follow the right strategic sequence
This principle summarizes the study of ways to reconstruct the boundaries of the market, the development of a strategic canvas and the choice of methods. customer acquisition. When these stages are completed, you should start creating an effective business model.
The blue ocean business model must be based on the right strategic sequence, which is expressed in terms such as “usefulness of the product”, “price”, “costs” and “implementation”.
How to implement a blue ocean strategy the right way
Written by Kim Chan and René Mauborgne, Blue Ocean Strategy sets out its own principles for strategy implementation. For the implementation of the strategy to be as effective as possible, you should adhere to 2 principles, which we will discuss below.
Overcoming organizational obstacles
There are 3 barriers to the implementation of a blue ocean strategy:
- Most employees are against change.
- The company is limited in resources.
- Employees do not want to change their usual ways of working.
To overcome these obstacles, the method of "point activation" should be used. Supervisor should focus on key employees and activities on which the development of the entire company depends. One of the ways to solve this problem can be an appeal to "opinion leaders".
The authors advise company executives to make sure that employees themselves understand the need for a change in strategy, to get them to communicate with dissatisfied customers. Avoid issuing binding orders. Make the strategy discussion transparent and open to all parties. Try to split the overall goal into smaller tasks, then it will be easier for employees to cope with them.
Building commitment to the strategy
The implementation of the blue ocean strategy should be developed through open discussion. In this way, employees will be able to make sure that its implementation is carried out honestly and transparently.
What the implementation of the blue ocean strategy brings to business
Studies conducted by the authors of the blue ocean strategy have shown that new product occurs only in 14% of cases, which provide 61% of the total company profits. This means that organizations that adhere to the principles of the blue ocean strategy have a significantly higher chance of success.
Companies that create new demand must seek differentiation and cost reduction. Then the price of the new product for buyers will become affordable. Over time, economies of scale will kick in and costs will drop even further.
Companies that have chosen a blue ocean strategy for their development can cover all available demand in the industry. As a result, imitation of a strong brand becomes unprofitable for competitors.
When competition in the new market will begin to intensify, find new ways to innovate. Go beyond the original strategy canvas and create new blue oceans.
Examples of large companies with a blue ocean strategy
The most popular example of blue ocean creation that the authors of Blue Ocean Strategy refer to is the Cirque du Soleil. The circus, founded in 1984 in Canada, has chosen a fundamentally new business model that differs from the approaches of traditional circus shows. The creators of the circus were convinced that the popularity of this type of entertainment in Canada began to decline rapidly. Children were interested in TV shows and video games.
Cirque du Soleil was able to return the popularity of circus shows, relying on an adult audience. The leadership of the circus has shifted its focus to fans of the theater and ballet art. As a result, the boundary between the circus and the theater became blurred, and adults began to make decisions about visiting the circus. At the same time, the cost of a ticket to the Cirque du Soleil did not exceed the price of a ticket to the theater, and the circus itself was able to reduce costs by abandoning traditional circus elements. The Cirque du Soleil now generates over $600 million in annual revenue, and the Canadian show has been watched by more than 150 million viewers in over 300 cities around the world.
Another famous example implementing a blue ocean strategy - the story of Apple's iTunes music service. In the early 2000s, the American company was able to create a new market space in the music industry, in which it maintains its leadership today.
In the late 1990s, the music market began to actively crack down on illegal downloads of music content. Apple has been able to take advantage of this trend and offer users a legal, yet simple and convenient way to download tracks. The iTunes music library has a convenient and understandable structure, and online users have the opportunity to download individual songs instead of buying the entire CD.
As a result of this unprecedented strategic decision, and through collaboration with the world's largest music companies, Apple has been able to secure copyright protection in the industry and meet the needs of users.
About Kim Chan and Rene Mauborgne's Blue Ocean Strategy
Blue Ocean Strategy is a business strategy book published in 2005. Since its first edition, the book has been translated into 43 languages and has sold over 3.5 million copies. Blue Ocean Strategy has been a bestseller by the Wall Street Journal, BusinessWeek, and Amazon.com. At the same time, the 00-CEO-READ resource named it the best-selling book in the decade 2000-2010.
Professor Chang Kim has been an advisor to many international corporations, as well as a contributor to leading business publications and the recipient of numerous major awards. Now Professor Kim is a member of the European Union with advisory functions.
René Mauborgne is one of the leading scientific staff French school INSEAD, member of the World Economic Forum and author of a large number of journalistic and scientific works.
A comparison of the capabilities of the blue and scarlet oceans is given in the table:
|
Scarlet Ocean Strategy |
blue ocean strategy |
|
Fight in the existing market space. |
Creation of a new market space. |
|
Victory over competitors. |
Opportunity not to be afraid of competition. |
|
Exploitation of existing demand. |
Formation and receipt of new demand. |
|
Tradeoff between value and cost. |
Breaking the trade-off between value and cost. |
|
Building the entire system of the company's activities depending on the strategic choice, focused on differentiation or low costs. |
Building the entire system of the company's activities in accordance with the task of simultaneously achieving differentiation and cost reduction |
Conclusion
Described in a book by European professors Chan Kim and René Mauborgne, the blue ocean strategy was first presented over 10 years ago. However, this approach to the development of business strategy does not lose its relevance even today, when world markets remain oversaturated with similar offers, and consumers pay more and more attention to the unique characteristics and values of the product.
Blue Ocean Strategy: How to create a free market and make competition irrelevant book Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant), written by W. Chan Kim and Renée Mauborgne, is one of the most significant business publications in recent times. It takes on the task of becoming a guide to how to create and occupy areas of the market free from competition - and copes with this task quite successfully.
The authors, professors at the Blue Ocean Strategy Institute and co-CEOs of INSEAD, use as examples 150 successful strategies applied over 100 years in 30 industries to prove that open clash with competitors does not bring real success.
On the contrary, the creation of “blue oceans” free from competition will ensure the growth of business, customer base and workforce, while creating demand and making the problem of competition irrelevant. The book offers a set of guidelines and tools to help companies systematically access these blue oceans.
blue ocean concept
As a prime example of the application of the blue ocean strategy, Mauborgne and Kim consider the experience of the Du Soleil circus. In 1984, when the Circus was just created, it faced a number of seemingly insurmountable obstacles. The circus business was (and still is) in decline, increasingly overshadowed by forms of entertainment such as television, sporting events and cinema.
Children, the target audience of the circus business, were addicted to video games in the mid-80s, and animal rights activists seriously raised the issue of the ethics of using animals in performances. Significantly, such major players in the circus market as Ringling Bros and Barnum and Bailey used a business model that they themselves created over a century ago.
But how did Du Soleil manage to increase revenue 22 times in 10 years in such an unfavorable environment? The answer may be the slogan for one of the first productions: "We have reinvented the circus." Du Soleil wasn't trying to make money by competing within the existing market by poaching audiences away from the Ringling Bros. and others. Instead, he created a free segment of the market, which made the issue of competition irrelevant.
He attracted a new audience, traditionally not spectators of circus performances - adults and corporate clients who preferred theater, opera, ballet, which means they were ready to pay many times more than the cost of an ordinary circus ticket in order to witness an unprecedented performance.
"Oceanography" of modern business
To understand the nature of Du Soleil's achievement, it is necessary to realize that the business universe consists of two separate spaces, which can be thought of as "red" and "blue" oceans.
The red oceans represent the types of business that exist today—the explored markets. In red oceans, the boundaries of the market are defined and accepted by all participants, the rules of competition are clear.
Companies here are trying to outperform competitors in order to capture a larger market share. As more and more participants enter this market, the prospects for profitability and growth become dim. The product turns into a product, and growing competition "colors the water the color of blood."
Blue oceans represent those species economic activity, which do not yet exist today - poorly studied markets, not tarnished by competition. In blue oceans, demand is created, not fought. There are ample opportunities for growth that is both profitable and fast.
Instead of a conclusion
There are two ways to create - or discover - blue oceans. In rare cases, companies manage to open completely new types of business, like eBay did with the online auction market. In most cases, the blue ocean is created from within the red ocean when companies manage to change the boundaries of existing activities.
W. Chang Kim, René Mauborgne, Blue Ocean Strategy. How to find or create a market free from other players”, M: Mann, Ivanov and Ferber, 2014. – 304 p. – Review
blue ocean strategy
How to find or create a market,
free from other players
Blue Ocean Strategy is bad book. But not just bad, but dangerous bad book.
Who among us would want managers to follow our pseudo-suggestions, especially if we were responsible for failures?
Stephen Brown,
marketing professor
ANY PRACTICAL businessman knows what it is he who will receive (apart from the lack of competition) if he enters the market with unique, demanded by the Clients offer.
He will get super profit!
At least for a while.
Dream about it, of course. all in business.
Why then do the few do it? The answer is simple: it is always difficult, sometimes very difficult, and sometimes hellishly difficult.
Be that as it may, any marketing breakthrough is creation.
Since there are few creators, and everyone wants to become one, there is a great temptation for academicians to create recipes for ersatz creativity for those who “are glad to be deceived themselves.” And there are millions of them, so it's no surprise that the Blue Ocean Strategy book, which promises to create super-profitable offers with a couple of armchair curves and matrices, is a stunning success.
On the website of the MIF publishing house, which presented this masterpiece to the Russian-speaking reader, we read:
“This book has been translated into 40 languages and published in more than 2 million copies, it was twice in the top ten business books of the decade, became best business book 2005 at the Frankfurt book fair and has received numerous other awards from reputable business publications. In the 7 years that have passed since publication, the book has not left the Top 10 of the best business books on Amazon.com and garnered over 250 positive reviews there.”
We'll talk about negative reviews later.
Let's go from the other side.
Most marketing professors have never made a dime in their careers in practical business. As a rule, they are afraid of him like the devil incense. They are comfortable in their academic ivory tower, where they produce theories that are good on paper and useless in the grim struggle for profit in business. This book is a prime example of this. This is yet another academic pseudo-suggestion, for the failures of which the authors take no responsibility.
Her core idea is beautiful and romantic:
“Imagine a market universe consisting of two oceans: scarlet and blue. Scarlet oceans symbolize everything existing industry at the moment. Blue oceans represent all industries that are still Does not exist.
In the red oceans, industry boundaries are defined and agreed (Who, when and how?) and the rules of the game competition everyone knows (Oh really!).
Blue oceans, on the other hand, represent untouched market areas. (And if you touch them?), require creativity (Does everything else in marketing require it?) and give you the opportunity to grow earn high profits. In blue oceans competition does not threaten anyone because the rules of the game (With myself with myself?) yet to be established."
book logic
While reading the book, I wade through a host of alogisms and even nonsense. Part 3 of the book stands out. For example, consider what you just read:
INCONSISTENCY : Scarlet oceans exist, they have competition; blue NOT exist, there is no competition. Therefore, according to the authors, if something “exists” (appears) on the market, then it automatically becomes “scarlet”. This means ... that there can be no blue oceans in principle !!! They can only NOT to be.
How then to understand phrases like "Blue oceans created always"? How can you create something that does NOT exist?
And if for years exist monopoly industries (for example, Xerox and Kodak), no competition? What color are their oceans? Red-blue?
More carefully, gentlemen, more carefully!
(Variations on this and related themes follow you throughout the book.)
This sweet promise of nirvana delights thousands of inexperienced marketers around the world. What about profits?
Since the book was published in 2005, it means that in 10 years the world should have already accumulated thousands of successful examples of the application of these instructions, i.e. firms living in a "blue" paradise with huge profits.
Not finding a single example, I turned to several prominent "blue" gurus and half-gurkas, primarily on the site www.blueoceanstrategy.com, with a request to provide at least a few proven examples of profit growth as a result of the application of the "blue" theory.
(See below for an example of the proven success of the Turkish supermarket chain Tanzas.)
I was sent to the library of supposedly such cases - www.blueoceanstrategy.com/elibrary. I diligently rummaged through it. Some of the cases are not related to the blue theory at all; in some it is mentioned simply as a synonym for the word "innovation". And in hindsight: many cases took place before inventions of this theory.
In other words, from a practical point of view, this beautiful fantasy is just empty.
But how did this miracle theory come to light?
The main author of the book, W. Chang Kim, is from Korea. This explains something. The fact is that Koreans are known for commendable performance and ... a rare inability to generate creative ideas. (For Russians, the opposite is true.) The Koreans more than compensate for the last drawback by copying and borrowing. (Russians have “own pride”!)
At the same time, Koreans, like alchemists, are in constant search for prostheses of creativity such as Kotler's "lateral marketing". Behind the stove, several of our adherents of TRIZ a, the mechanistic theory, which is sometimes called “mental masturbation,” have also taken root. So in Korea, the Blue Ocean Strategy came into play. Korea is working on the creation of the so-called. "creative economy". With unknown success.
This book, as it were, is also dedicated to business creativity. True, I'm not sure that the "gay" authors themselves have created at least something creative in business. Apart from the book itself, of course.
In business, only that which leads to profit can be considered truly creative. So, in advertising, they rightly believe for a long time that if advertising does not sell, then it is not creative. Everything else is a waste of resources. It's funny how a lot of marketers, both academics and practitioners, somehow failed to notice that "Oceans" had nothing to do with profits. It's an empty process for the sake of a process.
[Dear readers, I would be grateful to you for your examples of successful applications in practice of "blue" curves, matrices, definitions, etc. - how much additional profit did they bring you?]
By the way, about the proven results.
A few hours after posting this review, I received a response:
“Thank you, Alexander Pavlovich. We just wanted to go to the training "Blue Ocean Strategy", which took place recently at PRODEXPO 2015. Apparently, "Based on ..." and "From the creators ...". Thank God we didn't. 75 000 rub. three would be…”
As they say in one joke - a trifle, but nice.
Almost all business education is far from life, but the teachers of strategy and planning are the most distant from it.
In the book of our professors, the words "strategy" and "strategic" occur as many as 650 times (!?), and in the most incredible contexts and combinations. I was particularly impressed with the "visual strategy fair" and "sub-strategies". It seems that the authors consider any sneeze to be strategic.
For the authors, the core of blue strategicity is the concepts of "strategy canvas" (strategy canvas - by the way, it is more correct to translate it as "picture" or "canvas") and "strategic move" (strategic move). By the middle of the book, I was completely confused by them. Here are the definitions of these epochal paradigms:
X is both a tool for diagnosing and building an exciting blue ocean strategy.
Y – it is a set of management actions and decisions associated with the development of a major business proposal that creates a new market.
What is what?
In general, the book impresses with a fragrant bouquet of terms. How do you like this rose - "value innovation" (value innovation). It turns out that value can be innovated!
“Value innovation is the cornerstone of the blue ocean strategy. We call it value innovation (And then there is just a smart logical transition. Buckle up!), because instead of focusing all your efforts on the fight against competitors (Is there really such "fighters"!?), you make competition unnecessary (Simple and no fuss!) creating (How exactly?) such a leap in value for customers and for the company that you open up a new, uncompetitive market space.”
Astute reader, let's apply the authors' logic to other areas. For example:
Instead of fighting crime, you make crime unnecessary.
Instead of fighting fires, you make fires unnecessary.
You feel how wonderful your life has become immediately!!!
Remote 3-month
(And what is “value / value” I still don’t really understand. See “Value, USP and Selling Points”.)
The dog is buried in the word "creating", that is, inventing. Thousands of companies in different fields have been trying to create and invent something for years, but rarely anyone succeeds. And here, it is proposed to do it somehow in passing, just juggling very vaguely defined concepts of innovation and value. Brilliant, sir!
And here is the explanation:
“Value innovation is created (How?) in an area where the company's actions have a beneficial effect on the cost structure and on the value proposition to customers.
I didn't understand anything again. And you? Some costs fell from the sky, or rather their structure. Costs for what? Maybe this picture will clarify something for you:
There was also some differentiation.
Why should costs be reduced? There may be times when justified rising costs accompanied profit growth. By the way, many innovations require additional costs.
God alone knows exactly how the authors chose indicators for the x-axis. If these are criteria for assessing wine by buyers, then it is difficult to agree with this. Why are they in that order? It is surprising, in particular, that the authors in their "canvas" put the price in the first place. Etc. etc.
A scrupulous analysis of this awkward "outline" would take a lot of time and space. And it would give absurd results!
But that's not all.
When the value curve of a company or its competitors(!?) meets the three criteria for a good blue ocean strategy – has focus, divergence and motto(!?), this means that the company is on the right track.”
Recorded? Have you forgotten the motto?
Gentlemen, can we take a break from such an avalanche of “wisdom”?
Everything is wonderful here. Only a trifle is not clear - what and how exactly should be “created”? If the firm has an answer to this question, then it does not need any colorful theories sucked from the finger.
If you are, say, a novice author and you really want to become popular and make money, then you can, in the spirit of this book, offer “six principles”, “four actions”, “three criteria”, incl. and... the recommendation to "write a brilliant book." What would be the value of such a (paid) recommendation for you?
How does innovation appear?
Differently. But in any case, without pathetic lateral blue attempts!
It could be the insight of a technical and/or marketing visionary.(such as, for example, Sony founder Akio Morita) ; painstaking scientific work(Edison) ; by-product of research(many examples) and/or thorough marketing audit(even more examples).
Observation.– Most of the successful product and organizational ideas in marketing are connected with observation.
The genius of innovation Akio Morita said: “Carefully observe how people live, learn from observations intuitive feeling whatever they want and do it."
John Scully: “A good marketer must be conceptually intuitive, he must look for different points of view to solve old problems. He has to see the world differently… He has to be incredibly inventive in finding different approaches.”
Observation stimulates the imagination.
Imagination.- Theodore Levitt wrote: "The starting point of success in marketing is the marketing imagination." He continues: “What sets it apart from other types of imagination is that it provides a unique insight into Clients, their problems, and opportunities to capture their attention and habits.”
Some breakthroughs are the result of careful marketing analysis.
Marketing analysis.- The Turkish supermarket chain Tanzas, like everyone else, initially used standard programs (loyalty, etc.). Losses reached $100 million.
New director Servet Topaloglu, a man with an amazing marketing mind, created a new program in a few months. Her starting point was to analyze the responses of hundreds of buyers to the question - What do you NOT like about supermarkets? The Incredible Consumer Rights manifesto was created and many subtle customer-focused decisions were made.
In a year and a half, Tansas' revenues doubled. The network has become the most profitable in Turkey.
blue ocean creation pattern
consumer productivity lever
blue ocean ideas index
fair process
incoherent strategy
purposeful leadership
structuralist/reconstructionist view
ideal value
indirect marketing
strategic groups
six ways to change industry boundaries
visual awakening phase
What each of them means, I won’t tell you - when you get acquainted with another amazing term, its definition is forgotten after a couple of pages. Most likely, the authors spawned them to give their text more scholarship. And to disperse the amount of text.
The book is simply crammed with cumbersome charts and tables.
Captious Western reviewers note that the book is replete with "solid" ideas. Some of them are somewhat useful, for example, a draft checklist for analyzing the buying cycle ( to uncover). If you earn some money, making it more client-oriented and close to reality, then it can be used. Especially for a beginner marketer.
By the way, it will also be good for this beginner to get acquainted with some of the innovative cases from the book. At the same time, you should not pay attention to the fact that they are in no way connected with the "Oceans". They are interesting in their own right.
“And if the client is not a user, you need to expand the circle to include users.”
And what would that mean?
For example, if parents buy something for their young children, then preschool children should also be covered.
Here I, perhaps, will put an end to my not very corrosive analysis. This book is another sad text example, a thoughtful analysis of which would require more space than the text itself.
Conclusion
Every book that has no practical applications, takes a long time to digest, and gives unjustified hopes is harmful. That's what serious professionals think.
Type in the search engine the words “blue ocean strategy” + one of following words: “fantasy” (fantasy), “wishful thinking” (wishful thinking), “dangerous” (dangerous), “fluff” (something trivial, superficial) and “oversimplification” (simplification). The results will impress you. It is interesting to compare Oceans with fast food for business thinking.
Some of the professionals took the time to write sensible reviews (in English) - thanks to them for that. One of the most comprehensive:
A couple of quotes from it:
“The tools described are good for retrospective analysis, but they are not suitable for creating something new.”
"The main drawback of the theory is that it creates the delusion that it works."
The only "beneficiaries" of all this blueness are the authors of seminars and articles. They instantly picked up the topic and successfully cut coupons, hanging blue noodles on the ears of naive simpletons. A couple of examples:
Russia is a country of lovers of everything at the behest of a pike. We have a lot of respect for "quick/easy/WOW marketing". So I guess gay events don't suffer from a lack of clients.
"Blue" sections seem to be actively integrated into the programs of various faculties.
I think that our dashing programmers have already concocted some program for calculating "canvas", "innovations of values", etc. Why? Their colleagues have already crafted the program "How to maximize the effectiveness of a marketing automation system?" .
And that's true - for a long time marketers should be replaced by computers.
Some marketers are surprised that the venerable Harvard University Press published this book: "This book should be read by Harvard professors - what were they thinking when they allowed Harvard University Press to publish it."
It's easier with publishing houses - no one seriously analyzes what is published. (See, for example, "Myths about 'MYTH'".)
One Amazon reviewer writes, "This is a book that is written to make readers say WOW." (“It is a book that is written to wow readers.”) And who is our “WOW chief” in marketing? You, I think, have already guessed. It is also clear to everyone which publishing house was simply obliged to release this VOUCHER.
Above, the MIF publishing house told you about the stunning success of the book. Incl. and on the success of the book on Amazon.com: "... and collected over 250 positive reviews there."
Should have added:
Damn it, the British philosopher is probably right, public figure and the mathematician Bertrand Russell, who said:
"Given the stupidity of most people, the widely held view would be more stupid than reasonable."
Russell lived to 98 years. Too bad this sage didn't live up to the heyday of academic marketing. If only he was amazed at the mental and moral qualities of his representatives!
P.S. Dear young marketers, do not take anything in the marketing literature for granted, without evidence and justification. Train your critical marketing thinking. Don't become a victim "The Effect of Sheer Stupidity in Marketing" .
Think, think, think, dear friends.
Think with your head, damn it!
The blue ocean idea is not new at all and has been touched upon in one form or another by so many marketing people. But it was this name that was fixed in the minds, instead of “new niches”, “free cells”, “unoccupied segments”. And yes, it does sound much better. So what is a blue ocean strategy? This issue is elaborated in the book by Chan Kim and Rene Mauborgne in the book of the same name.
The authors consider all markets as scarlet, i.e. highly competitive (associated with bloody battles in fiercely competitive markets) and blue, i.e. free, deep, where there is no one but you.
What is the blue ocean idea and that you are the smartest? It is clear that anyone wants to find such an ocean. Why do some find it while others get more and more bogged down in competitive wars? The fact is that we need to move away from the usual views, and assess the situation as a whole, from the outside.
Well, for example, in the book I really liked the example with wines. Wine, as you know, is a noble drink and a very small number of people can truly appreciate it. When evaluating wine, they look at the year, grape variety, aftertaste, aroma, and much more. And if you consider that there are many varieties of each type ... in general, it’s easier to take beer.
One company decided to do just that - they made a simple wine of just a few types, in simple bright bottles. Now the buyer did not have to walk between the rows for a long time, from one variety and producer to another. They took one of two kinds (sweet or dry) and went to the checkout.
To create a new blue ocean, you need to be clear about your customer value scale and where each competitor is. To better understand this situation, consider a hypothetical example.
Let's say our task is to find a blue ocean in the printing services market of our city. First of all, it is necessary to highlight the key values of customers:
- order processing speed;
- print quality;
- information about the status of the order;
- transparency of calculations;
- — price;
- work with the customer;
- layout approval process;
- quality assurance.
Suppose there are several competitors in the market (often similar competitors with the same strategy can be combined into one group).
Each of the characteristics can be divided into scales (high / medium / low), and display competitors on this graph. It will come out something like this:
Those. for each of the competitors, we set points for these parameters and look at free niches. As you can see, at the moment in this market, no one is engaged in urgent low-cost orders. At the same time, the calculations are not transparent, and customers do not know about the status of the order until it is completely ready. This could be our blue ocean. The main thing is not just to declare these values, but also to convey them to our customers and actually fulfill them.
As you can see from the example, there is nothing complicated about this. The main thing is a well-compiled map of competitors and a real assessment of your values in the eyes of customers. When in doubt, or speculating, do more research. Just don't put closed questions. Let your client talk. She will surely tell you where to look.
Another option is to look at adjacent areas: what can be borrowed there? Or perhaps how to apply their achievements to your market (wine is like beer).
Of course, you should calculate everything, and not rush into every free niche (for example, the niche of low-quality and very expensive goods is probably free. But is there a demand for such goods?). In other words, the blue ocean strategy shows you the possibilities. And already their implementation is completely on your shoulders.
I hope this article will help you decide on your strategy and it will help you find your blue ocean.
By the way, you can buy the book for Russians here.