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Usually ships in 1 business days | | | | | | Written by the business world's new gurus, Blue Ocean Strategy continues to challenge everything you thought you knew about competing in today's crowded market place. Based on a study of 150 strategic moves spanning more than a hundred years and thirty industries, authors W. Chan Kim and Renee Mauborgne argue that lasting success comes from creating 'blue oceans': untapped new market spaces ripe from growth. And the business world has caught on - companies around the world are skipping the bloody red oceans of rivals and creating their very own blue oceans. With over one million copies sold world wide, Blue Ocean Strategy is quickly reaching "must read" status among smart business readers. Have you caught the wave? | | | |
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| | Product Details | | Author: | W. Chan Kim | | Hardcover: | 256 pages | | Publisher: | Harvard Business Review Press | | Publication Date: | February 03, 2005 | | Language: | English | | ISBN: | 1591396190 | | Product Length: | 9.48 inches | | Product Width: | 6.28 inches | | Product Height: | 0.95 inches | | Product Weight: | 1.13 pounds | | Package Length: | 9.2 inches | | Package Width: | 6.4 inches | | Package Height: | 1.1 inches | | Package Weight: | 1.15 pounds | | Average Customer Rating: |  based on 257 reviews |
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| | Customer Reviews | Average Customer Review: ( 257 customer reviews )
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490 of 524 found the following review helpful:
 Value Innovation - strategy book of the year 2005? Jan 10, 2005
By Peter Leerskov
"The Strategist, www.lace.dk"
The authors have published many articles over the last decade on Value Innovation. This is their first book. It summarizes their extensive knowledge on out-of-the-box strategic thinking.
What is a BLUE OCEAN STRATEGY? The authors explain it by comparing it to a red ocean strategy (traditional strategic thinking):
1. DO NOT compete in existing market space. INSTEAD you should create uncontested market space.
2. DO NOT beat the competition. INSTEAD you should make the competition irrelevant.
3. DO NOT exploit existing demand. INSTEAD you should create and capture new demand.
4. DO NOT make the value/cost trade-off. INSTEAD you should break the value/cost trade-off.
5. DO NOT align the whole system of a company's activities with its strategic choice of differentiation or low cost. INSTEAD you should align the whole system of a company's activities in pursuit of both differentiation and low cost.
A red ocean strategy is based on traditional strategic thinking - e.g. Harvard's strategy guru Michael Porter.
Some cases:
* Airline industry price wars result in bankruptcies and low profit margins. Southwest Airlines creates a new market by offering the speed of air travel with the low cost and flexibility of driving.
* Golf equipment industry competes to win a greater share of existing golf customers. Callaway Golf creates "Big Bertha", a golf club with a large head that attracted new customers to golf that had been frustrated by the difficulty of hitting the ball.
* The cosmetic industry creates a red ocean with models, expensive advertising, and promises of youth and beauty. The Body Shop creates a blue ocean that lasts more than a decade by creating functional cosmetics that defied the industry which sold emotionally appealing cosmetics.
* The wine industry gluts the market with a red ocean of thousands of brands competing on the finest oaks and tannins and legacy winey names. Casella wines creates [yellow tail], a blue ocean wine that succeeded by eliminating complexity, elitism and consumer confusion and creating a fun simple image that non-wine drinkers could enjoy.
A blue ocean is created in the region where a company's actions favourably affect both its cost structure and it value proposition to buyers. Cost savings are made from eliminating and reducing the factors an industry competes on. Buyer value is lifted by raising and creating elements the industry has never offered. Over time, costs are reduced further as scale economies kick in, due to the high sales volumes that superior value generates.
Examples of strategic moves that created blue oceans of new, untapped demand:
- NetJets (fractional Jet ownership)
- Cirque du Soleil (the circus reinvented for the entertainment market)
- Starbucks (coffee as low-cost luxury for high-end consumers)
- Ebay (online auctioning)
- Sony (the Walkman - personal portable stereos)
- Cars: Japanese fuel-efficient autos (mid-70s) and Chrysler minivan (1984)
- Computers: Apple personal computer (1978) and Dell's built-to-order computers (mid-1990s).
The INSEAD professors Kim and Mauborgne have written regularly on the subject of Value Innovation since 1997 in Harvard Business Review. Being a business development manager, their thought leadership on strategic innovation has inspired me tremendously over the years. Their articles have been standard texts for many MBA students for some time (e.g. "Value Innovation", "Creating New Market Space", "Charting your Company's Future"). I expect their first book to be just as dominant in any strategy library as Michael Porter's books (the guru behind the classic red ocean strategies).
Peter Leerskov,
M.Sc. in International Business (Marketing & Management) and Graduate Diploma in E-business
423 of 455 found the following review helpful:
 I thought oceans were deep... Jan 11, 2006
By B. Gilad
This book is mostly "fluff". Its basic argument is that companies who find themselves in hotly contested markets ("red oceans") should look for uncontested markets ("blue oceans"). They should do it in such a way as to ensure revenues (so go for mass), and profit (so watch the cost). Wow. I guess if the authors said: go for high-cost-small-markets, at least it will be original! The problem with this book is that it is a mishmash of old ideas, and its mortal sin is that it is trivial. It looks at successful products and service offerings, and in retrospect identifies the characteristics that made them succeed (at least revenue wise, there is no real financial analysis in this book). Naturally, finding those characteristics is the real issue, and it is the realm of entrepreneurial vision. Beyond some trivial labels placed on common sense planning activities, Blue Ocean does not help one iota in finding uncontested markets with large profit potential. Anyone who seriously tries to apply the ideas in the book will find they are either trivial or fluff.
The lack of originality is everywhere. Let's look closer: The book main point is that companies must do different things than competitors to be in uncontested markets. Fans of Michael Porter will immediately recognize this as the theme of his seminal 1996 article "What is Strategy" (go to www.hbsp.harvard.edu to buy this article). Interestingly enough, Kim and Mauborgne published their first work on value innovation in...yes, 1997. Porter identified three bases for successful strategies: need-based, variety-based, and access-based. Unlike the authors of Blue Ocean, he did not pretend to have an a priori formula for finding success. All he did was to show what makes a superior strategy, and why superior strategies are sustainable over a long period of time. Kim and Mauborge wrote a "formula" type prescription to finding quick success (by avoiding competition), but they neither truly give any tools to do so, nor prove that the companies they feature have created a sustainable profitable advantage. What the authors say is: focus, diverge and have a great marketing tagline. In other words - you want to be different? Be different. And how do you know which different to be? Ahhh, that's simple. Look at what customers and noncustomers need but do not get from the existing offering of the incumbents in the industry. Wow. Who would have thought about that?
The main tool of this book, the strategy canvas, is nothing more than an after the fact simplified two dimension graphical presentation of product or services' characteristics that make some products better than others. Do you remember the Quality Deployment Function, a product/service design matrix that came out of Japan, developed in the 80s by the Japanese consultant Yoji Akao? The QFD framework has been used by Japanese companies for decades now to translate "true" (and often unmet and unstated) customer needs into actions and designs to build and deliver a quality product. QDF also came with a little graphic help, but more sophisticated than the one in this book. Finding which characteristics will be the wining ones is an old market research goal, and it is much easier in retrospect.
The authors are not beyond copying any once popular simple concept. In chapter 4 they introduce with a big fanfare a revolutionary new concept, classifying businesses as Pioneers, Migrators, or Settlers. Anyone recognizing Boston Consulting Group's portfolio matrix of cash cow, question mark and star companies is not wrong. This simplistic labeling is what made BCG so popular (and destroyed many companies and made Wall Street discount conglomerates in the US) and probably why this book has attracted people desperately looking for simple solutions in complicated contested markets. But anyone actually responsible for charting strategy and managing competition in real contestable markets (i.e., business managers and executives) will quickly realize this book has no practical substance. It is all fluff. And if you are lucky to create a less contested market, this book will tell you nothing about how to KEEP it that way!
Finally, as a strategy professional, I realized quickly that this book is not really about strategy, which as Porter shows is a whole chain of operational activities geared toward the different positioning. This book is better titled "a book of lists of some successful products and services in the past 20 years, plus some trivial labels of where they were unique" because once you see beyond the superficial façade of the "value innovation process", this is what the book is all about: a list of some successful new products, created by companies and entrepreneurs who had the insight of how to be different. An insight as enigmatic after reading the book as it is before...
To apply the book's measure of "blue ocean innovation", it is not divergent from past books, nor focused on the real issues to justify its price. It does have a catchy tagline though, and like all quick fads, tagline is everything... I feel sorry for my hassled executive friends who are under severe pressure to compete and are hoping this book will help. It will not.
137 of 153 found the following review helpful:
"To strive, to seek, to find...." Jan 31, 2005
By Robert Morris
This is an especially thought-provoking book which, as have so many others, evolved from an article published in the Harvard Business Review. According to Kim and Mauborgne, "[in italics] Blue ocean strategy [end italics] challenges companies to break out of the red ocean of bloody competition by creating uncontested market space that makes the competition irrelevant...This book not only challenges companies but also shows them how to achieve this. We first introduce a set of analytical tools and frameworks that show you how to systematically act on this challenge, and, second, we elaborate the principles that define and separate blue ocean strategy from competition-based strategic thought." There are six principles which are introduced and then discussed on pages 49, 82, 102, 117, 143, and 172, respectively.
Frankly, I was somewhat skeptical that this book could deliver on the promises made in its subtitle. In fact, the material provided by Kim and Mauborgne is essentially worthless unless and until decision-makers in a given organization accept the challenge, are guided and informed by the six principles, and effectively use the tools within appropriate frameworks. The responsibility is theirs, not Kim and Mauborgne's. To assist their efforts, Kim and Mauborgne focus on several exemplary companies which have dominated (if not rendered irrelevant) their competition by penetrating previously neglected market space. They include the Body Shop, Callaway Golf, Cirque du Soleil, Dell, NetJets, the SONY Walkman, Southwest Airlines, Starbucks, the Swatch watch, and Yellow Tail wine.
Of greatest interest to me is Kim and Mauborgne's assertion that the innovations which enabled these companies to succeed with a Blue Ocean strategy did NOT depend upon a new technology. Rather, each company pursued a strategy which enabled it to free itself from industry boundaries. For Dell, that meant mass production of computers sold directly to consumers per each customer's specifications. Quite literally, each sale is "customized." For Callaway, creating an enlarged sweet spot to increase the frequency of solid contact for new or infrequent golfers just as, years ago, the enlarged Head racquet did so for new or infrequent tennis players. For Starbucks, creating a congenial environment within which to socialize, go online, or read while consuming coffee. All of these Blue Ocean strategies created new or much greater value for customers. Their emphasis is on the quality of experience, not on the benefits of a new technology.
According to Kim and Mauborgne, their research indicates that "the strategic move, and not the company or the industry, is the right unit of analysis for explaining the creation of blue oceans and sustained high performance. A strategic move is the set of managerial actions and decisions involved in making a major market-creating business offering." The cornerstone of a Blue Ocean strategy is value innovation which occurs "only when companies align innovation with utility, price, and cost positions. If they fail to anchor innovation with value in this way, technology innovators and market pioneers often lay the eggs that other companies hatch." For Kim and Mauborgne, value innovation is about strategy that embraces the entire system of a company's activities. It requires companies to orient the whole system toward achieving a "leap" in value for both buyers and themselves. Kim and Mauborgne explain HOW to create uncontested market space wherein competition is essentially irrelevant.
To paraphrase Henry Ford, whether decision-makers think they can or think they can't do that, they're right.
35 of 36 found the following review helpful:
 Clever presentation. A quick read. Needs more substance. Sep 06, 2005
By Zdzislaw Nagengast
"ted nagengast"
The authors, regular contributors to the Harvard Business Review, have created a book from their previous writings. It's a nice little book, easy to read, with breezy overviews of hand picked examples but totally derivative. However, the authors are 1000% correct in their fundamental points:
It's better to find uncontested market space
Your competition does become irrelevant - for a while.
Create and capture new demand.
Break the value/cost trade-off.
Align a company's whole system of activities in pursuit of differentiation and low cost.
Only one small problem with above - it's hard to do and they offer no real insights into the how. In fact they only devote a handful of pages to the most important aspect of strategy and that is execution of the strategy. That's a serious shortcoming of the book.
I wish they did a better analysis of companies that tried to follow this strategy and failed. That would have been very insightful. I also wish that they weren't so superficial in their examples. Case in point: they reference Southwest Airlines and state that the change they instituted was a result of eliminating meals, and eliminating reservations. They did do those things but they were the icing, not the cake. They never once mention the real reasons they were so disruptive to the industry; Southwest abandoned the traditional hub and spoke model, they maximized the utilization rate of the planes by faster airport turnaround and they changed the labor paradigm dominant in the industry.
They also didn't spend enough time discussing the fact that executing this strategy cannot create a sustainable competitive advantage. They admit to this and discuss the Body Shop as one example. Unfortunately, the best advice they offer up is once your advantage disappears you need to repeat the Blue Ocean process. By the way there are even fewer examples of companies doing this recreation successfully in the real world.
I liked some of the graphics they created. I especially liked the graphic that shows where a company spends its resources. They used it to represent the before and after picture for a company. I find this is a great tool and give them credit for it. Some of the other tools they describe are OK. I found them a bit confusing, especially the use of a six by six analysis matrix but they are obviously going to leverage their work to create a consulting business.
Why did I say this book was derivative? Although the book is packaged cleverly it does not represent much original thought. One reviewer mentioned that Christiansen's Innovators Dilemma is a better book. I totally agree. You would also see a lot of the Blue Ocean themes in Pralahad and Hamel's book, Competing for the Future. Lastly, I found the references to traditional strategy amusing, especially the knocks on Porter. I can't really tell if they've been following the evolution of Porter's thinking but I suspect they haven't. It's not all Red Ocean.
Is this a bad book? Certainly not. Is it worth buying? You could do worse. I would just read the authors HBR articles and save the money. Will you learn something? Probably. Are there better thought leaders in the field? Absolutely.
27 of 27 found the following review helpful:
Great start but it gets weaker as it progesses Oct 14, 2005
By Doug Laplante
"student of innovation"
Blue Ocean Strategy is a good follow-up to Christensen's "The Innovator's Solution". Kim and Mauborgne pick up where Christensen leaves off in terms of how to "compete with non-competion". Their "strategy canvas" and "four actions framework" clarify many of the past business success stories we read about in business books. The book truely does offer a framework for those who are trying to create growth in highly competitive situations. I would recommend the book for those who spend time working on business growth.
The problem I have with the book is three-fold. First, all the meat is in the second chapter - "Analytical Tools and Frameworks". The rest of the book could be summarized as look broader, think big, don't do things out of order, and don't forget how hard it will be to implement change. All this is dressed up with a little too much consultant-speak for my taste (i.e. price corridors and the BOI index)
Secondly, the examples are not as well researched as I would expect. For instance, the [yellow tail] example is a great story, but the authors failed to mention that one of the key elements of the success of that Australian wine was that Casella Wines included a WJ Deutsch, a huge wine exporter, in the innovation (and profits) by setting up a 50/50 joint venture. Another example of missing key facts in a story is the NYPD Police Commisioner Bratton example in chapter #7. That story, laid out in less detail in Gladwell's "The Tipping Point", was later brought into question in "Freakonomics". Levitt and Dubner make a strong case that data show that the decrease in crime in the 90's in NYC was mostly due to simply adding more police officers. This hiring was done by Mayor Dinkins in response to the upcoming election against Gulliani, so Dinkins wouldn't get hit so hard on the "soft on crime" issue. The lack of thorough research left me wondering if the other examples were half-baked; leaving me wondering how thin the ice would get when I tried to implement some of the book's ideas.
Lastly, there is a bit of unsubstantiated world-view sprinkled throughout the book that the reader has to be careful about. Statements like "companies, like individuals, have a tough time translating thought into action..." (chapter 7) or "If individuals are not treated as though their knowledge is valued...they will hoard their best thinking and creative ideas...What's more they will reject others' intellectual worth as well..." (chapter #8)
Again, this is worth a read, but mostly for chapter #2.
See all 257 customer reviews on Amazon.com
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