Product Description

Winning by Not Competing: A Fresh Approach to Strategy

Since the dawn of the industrial age, companies have engaged in head-to-head competition in search of sustained, profitable growth. They have fought for competitive advantage, battled over market share, and struggled for differentiation. Yet these hallmarks of competitive strategy are not the way to create profitable growth in the future.

In a book that challenges everything you thought you knew about the requirements for strategic success, W. Chan Kim and Renée Mauborgne argue that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Based on a study of 150 strategic moves spanning more than a hundred years and thirty industries, the authors argue that lasting success comes not from battling competitors, but from creating "blue oceans": untapped new market spaces ripe for growth. Such strategic moves-which the authors call "value innovation"- create powerful leaps in value that often render rivals obsolete for more than a decade.

Blue Ocean Strategy presents a systematic approach to making the competition irrelevant and outlines principles and tools any company can use to create and capture blue oceans. A landmark work that upends traditional thinking about strategy, this book charts a bold new path to winning the future.

W. Chan Kim is the Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International Management at INSEAD. Renée Mauborgne is the INSEAD Distinguished Fellow and Professor of Strategy and Management.

Product Details

• Amazon Sales Rank: #552 in Books
• Published on: 2005-02-03
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 256 pages

From Publishers Weekly
Kim and Mauborgne's blue ocean metaphor elegantly summarizes their vision of the kind of expanding, competitor-free markets that innovative companies can navigate. Unlike "red oceans," which are well explored and crowded with competitors, "blue oceans" represent "untapped market space" and the "opportunity for highly profitable growth." The only reason more big companies don't set sail for them, they suggest, is that "the dominant focus of strategy work over the past twenty-five years has been on competition-based red ocean strategies"-i.e., finding new ways to cut costs and grow revenue by taking away market share from the competition. With this groundbreaking book, Kim and Mauborgne-both professors at France's INSEAD, the second largest business school in the world-aim to repair that bias. Using dozens of examples-from Southwest Airlines and the Cirque du Soleil to Curves and Starbucks-they present the tools and frameworks they've developed specifically for the task of analyzing blue oceans. They urge companies to "value innovation" that focuses on "utility, price, and cost positions," to "create and capture new demand" and to "focus on the big picture, not the numbers." And while their heavyweight analytical tools may be of real use only to serious strategy planners, their overall vision will inspire entrepreneurs of all stripes, and most of their ideas are presented in a direct, jargon-free manner. Theirs is not the typical business management book's vague call to action; it is a precise, actionable plan for changing the way companies do business with one resounding piece of advice: swim for open waters.
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

Review
"Blue Ocean Strategy will have you wondering why companies need so much persuasion to stay out of shark-infested waters." -- BusinessWeek, April 4th 2005

"Blue Ocean raises pertinent questions… and delivers valuable answers." -- American Way, March 2005

"Companies struggling to stay afloat in the market's...red oceans would do well to look into Blue Ocean Strategy." -- Fort Worth Star Telegram, 14 February 2005

"The book is clearly written, offering many examples of blue-ocean strategies and the techniques to develop such a scheme." -- Globe and Mail, June 8, 2005

From the Inside Flap
"After reading Blue Ocean Strategy, you will never again see your competition in quite the same light. Kim and Mauborgne present a compelling case for pursuing strategy with a creative, not combative, approach. Their emphases on value innovation and stakeholder engagement alone make this book a must-read for both executives and students of business."

-Carlos Ghosn, President and CEO, Nissan Motor Co., Ltd.

"This is an extremely valuable book to read. It examines the experience of companies in areas as diverse as watches, wine, cement, computers, automobiles, and even the circus to shed new light on the development of future strategies."

-Nicolas G. Hayek, Cofounder and Chairman of the Board, Swatch Group

"I recommend Blue Ocean Strategy to any executive in the private or public sector. It shows how to break from the status quo, create a winning future strategy, and execute this fast at low cost. As much a practical guide as an eye-opener."

-William J. Bratton, Chief of the Los Angeles Police Department, former Police Commissioner of the City of New York

"Kim and Mauborgne's strategies are not only original but practical. Our company has used them and obtained powerful results. The authors chart a bold new path to winning the future."

-Patrick Snowball, Chief Executive, Norwich Union Insurance

Customer Reviews

Make your Blue Ocean. Get the Tools hear!
This is one of those books that makes you sit back and say Wow every few pages. I have been involved in a business for a number of years and was in search of a book that might help us accelerate our growth.

Blue Ocean strategy is one the best books I have read in my educational library for some time. It talks about how to take what you got (your business/organization) and re-invent it into something that is even better, making your company stronger within and giving the market place something that is unique, with potential for strong growth. A strong emphasis is on taking a hard look at what you have and know for certain what the market demands or goals to be attained, then using the tools in this book to get there.

Folks that might review this book in a bad light are those that lack creativity or are unwilling to do the work required for the tools in Blue Ocean Strategy (BOS) to be useful. Every organization that is in need of help is deferent. This book has a great foundation to work from to make the changes needed.

BOS is a book of tools and strategies that can be used by any business to re-organize or re-invent and set a new course for growth. I would recommend this book to anyone that wishes to re-invent a company or is considering making a new company that will likely break away from the competitors. An excellent read!

Nice framework, plenty of useful tools - but no silver bullet unless you bite it
Blue Ocean Strategy is very popular book with over a million copies sold. The subtitle contains a lofty promise as is often the case with strategy books, presumably so they'd sell more. "Making the competition irrelevant" always sounds good. But despite the numerous copies sold and, one would assume, attempts at creating a "Blue Ocean" as the authors call markets with no competition, we still see quite a bit of competition in the world in most or all industries. So what gives? Is the promise overstated and is the book just another useless strategy book out of which comes no practical value?

Yes and no. Of course it doesn't magically make your competition irrelevant just like that. But Blue Ocean Strategy is also far from impractical or useless. So what is a Blue Ocean anyway? It's an area of uncontested market space, where there are no competitors (yet). Traditionally companies strive at surviving in so-called Red Oceans, the hotly contested traditional markets with clearly defined boundaries and competition. The Blue Ocean Strategy is about a systematic approach to creating Blue Oceans.

One could be forgiven to think that there are no more Blue Oceans left in the world, that the hyper-competition has exhausted all possibilities of new "virgin" markets. But that would be a mistake. All you need to do is to think back only, say, 30 or 40 years, and you will find that many industries we now take for granted simply didn't exist. One of the biggest in the world, one of the few trillion-dollar industries today, was nowhere to be seen 30 years ago - mobile communications. Or biotechnology, nanotechnology, discount retail, snowboards, home videos... the list is surprisingly long. And then think forward 15, 20 or 30 years - wouldn't it be simply unrealistic to assume no new industries pop up? There are Blue Oceans, but the question is how to get there.

So how does the book help in this task? By providing a number of useful tools, processes and frameworks, the book actually does help in accomplishing that. One of the key tools is the strategy canvas - a visualization of a companies strategy mapped as a graph of key principal factors. We've used the strategy canvas at work and it's a quite nice visualization tool. There is also a plethora of other frameworks and tools in the book, including some with very poor names - or what comes to your mind from a "PMS Map"? ;) (it's actually a pioneer-migrator-settler map, luckily one of the less useful tools in the book)

Like many good books, one of the best offering in the book is the wealth of case studies and real-life examples. It's interesting to note that household names such as CNN and JCDecaux were once seen as radical companies, in effect implementing the Blue Ocean strategy very successfully. There are also many valuable points that may seem counter-intuitive; for one, customer desegmentation is often called for when looking for Blue Oceans, going against the current trend of increasing customer segmentation and targeting. And, despite the pompous subtitle, the authors at the end do acknowledge that companies need to be good at both Blue Ocean and Red Ocean strategies - furthermore, there are no permanently excellent industries or even permanently excellent companies. To stay at the top, the company would need to constantly be re-inventing itself, but very few or no companies actually manage to do that. That alone ought to be a sobering lesson.

Blue Ocean Strategy is certainly a very good book and I definitely plan on continuing to use the tools I've learned from it. Of course it's not perfect; for one, it's missing some important innovation process information (making "How breakthroughs happen" a good companion read). The book also attributes perhaps too much weight on the new strategies in the lowering of NYC's crime (you'll recall the Tipping Point providing an alternative, or at least complementary, explanation). Still, the shortcomings are relatively minor - the book is excellent. Read it. But then again, merely reading it will do nothing for your company. If you don't do the significant footwork involved, expect to get nowhere.

Framework to look for uncontested market space and breaking away from competition
W. Chan Kim is Professor of Strategy and International Management at INSEAD. Renée Mauborgne is The INSEAD Distinguished Fellow and a Professor of Strategy and Management. This book was published in 2005 and consists of three parts, whereby each part consists of 2-to-5 chapters each. There is also a short preface and 3 proper appendices.

The aim of the book is made clear in the preface: to make the formulation and execution of blue ocean strategy as systematic and actionable as competing in the red waters of known market space. Whereby the authors in the first chapter introduce blue ocean strategy: "... blue ocean strategy challenges companies to create uncontested market space that makes the competition irrelevant ... blue ocean strategy is about growing demand and breaking away from the competition." The successful formulation and execution of blue ocean strategy is based on six principles which are discussed in chapter 3 through to 8. However, Chapter 2 first introduces the analytical tools and frameworks that are essential for creating and capturing blue oceans.

The 4 chapters in Part II - Formulating Blue Ocean Strategy introduce the four guiding principles for the successful formulation of blue ocean strategy. Chapter 3 identifies the paths by which you can systematically create uncontested market space across diverse industry domains, hence attenuating `search risk'. The authors introduce the `six paths framework' which have general applicability across industry sectors for remaking market boundaries. In the fourth chapter, the authors recommend companies to redesign their traditional strategic planning process and focus on the big picture, via the strategy canvas, to create value innovation and thereby tackling `planning risk'. The authors minimize `scale risk' in Chapter 5 by challenging conventional practice of aiming for finer segmentation to better meet existing customer preferences and create the greatest market of new demand. Chapter 6 addresses `business model risk' by ensuring that a company builds a viable business model to product and maintain profitable growth through a strategy sequence of utility, price, cost, and adoption.

In Part III - Executing Blue Ocean Strategy the authors turn to the principles that drive effective execution of blue ocean strategy. Specifically, Chapter 7 deals with organizational risk and introduces `tipping point leadership', which managers can use to mobilize an organization the key organizational hurdles that block the implementation of a blue ocean strategy. Chapter 8 argues for the integration of execution into strategy making and deals with `management risk' associated with people's attitudes and behaviors. The final chapter discusses the dynamic aspects of blue ocean strategy - the issues of sustainability and renewal. "Creating blue oceans is not a static achievement but a dynamic process." In addition, there are 3 proper appendices to assist in the explanation of blue ocean strategy.

Yes, I do like this book. I see this book as a complement in the field of strategy to Michael E. Porter's landmark book "Competitive Strategy". The authors focus on the creation of blue oceans, which is about growing (new) demand and breaking away from the traditional face-to-face competition that can be seen in red oceans. Blue ocean strategy is based on 4 formulation and 2 execution principles that address both opportunity and risk. Just keep in mind that creation of blue oceans will take time, requires determination to sustain and continuously renew the chosen strategy.