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Value Innovation is about saving costs by eliminating and reducing the factors an industry competes on while increasing buyer value by raising and/or creating factors the industry has never offered.Ĩ Guiding Principles of Blue Ocean Strategy You should place the same emphasis on value and on innovation (not necessarily technology innovation), and align innovation with utility, price, and cost positions. Instead of focusing on overcoming the competition, with Value Innovation, you “focus on making the competition irrelevant by creating a leap in value for buyers and for your company”, thereby opening up new and ‘uncontested’ market space. Successful blue ocean companies follow a different strategic logic that the authors call Value Innovation. The paradox is that the only way to beat the competition is to stop trying to beat the competition. There is a step-by-step model for creating strategyĪ Blue Ocean Strategy is about growing demand and breaking away from competition.Strategic creativity can be unlocked systematically.Industry structure is not given it can be shaped.Competition should not occupy the centre of strategic thinking.In time, competition emerged, but firms still managed to find new blue ocean opportunities in these markets. Many of the industries we know today started out as blue oceans – automotive, electronics, computers, aviation, shipping containers, petrochemicals, biotechnology, smartphones, mobile banking etc. Chan Kim and Renée Mauborgne is underlined by descriptions of the success stories of many companies who have implemented blue ocean strategies. It is about getting “out of the red ocean of bloody competition and into a blue ocean of uncontested market space characterised by new demand and strong profitable growth”. Would you rather operate in a highly competitive market or in one free from competition? That’s the question posed by the book Blue Ocean Strategy. But what is it all about and what are the important lessons we can learn as business leaders looking to forge our own strategic direction and succeed? Talk to us about building your strategyīlue Ocean Strategy is one of the best-selling and most important books on business strategy ever written.