Loading presentation...

Present Remotely

Send the link below via email or IM

Copy

Present to your audience

Start remote presentation

  • Invited audience members will follow you as you navigate and present
  • People invited to a presentation do not need a Prezi account
  • This link expires 10 minutes after you close the presentation
  • A maximum of 30 users can follow your presentation
  • Learn more about this feature in our knowledge base article

Do you really want to delete this prezi?

Neither you, nor the coeditors you shared it with will be able to recover it again.

DeleteCancel

Make your likes visible on Facebook?

Connect your Facebook account to Prezi and let your likes appear on your timeline.
You can change this under Settings & Account at any time.

No, thanks

Blue Ocean Strategy

Presentation for Strategy Class
by

Levon Demirchyan

on 19 April 2013

Comments (0)

Please log in to add your comment.

Report abuse

Transcript of Blue Ocean Strategy

& At the time of blue
ocean creation, was
the industry attractive
or unattractive? By W. Chan Kim and Renée Mauborgne Blue Ocean Strategy This article presents the concept of blue ocean strategy and describes its defining characteristics, citing as an example, Cirque du Soleil. Presented by: Demirchyan Levon
Gabrielyan Zaruhi
Hayrapetyan Astghik
Maghakyan Anna
Sargsyan Hrayr
Torosian Nareh “Competing in overcrowded industries is no way to sustain high performance. The real opportunity is to create blue oceans of uncontested market space.” The defining characteristics BLUE OCEAN
Irrelevant Competition and Uncontested Market Space
Focus on Non-Customers
Break Value-Cost Tradeoff
Pursuit of Differentiation AND Low Cost RED OCEAN
Beat the Competition and Compete in Existing Market Space
Focus on Existing Customers
Make Value Cost Tradeoff
Choice of Differentiation OR Low Cost Make the Competition Irrelevant and Create Uncontested Market Space Focus Break the Value Cost Tradeoff Four Actions Framework The Lowest Cost Structure in the Industry
Cars Highly Standardized With Limited Options and Interchangeable Parts
Unskilled Laborers Who Worked on One Small Task Ford's Revolutionary Assembly Line Car in Just 4 Days Vs Industry Norm of 21 Forbes List
The World's Billionaires
#374 Guy Laliberte Net Worth: $2.5 Bill
Fortune: Self Made
Source: Cirque du Solei
Age: 50
Citizenship: Canada
Residence: Montreal
Education: NA
Marital Status: Divorced,
5 Children The business universe consists of two distinct kinds of
space: Red and Blue oceans.
Red oceans represent all the industries in existence today-the known market space.
Blue oceans denote all the industries not in existence today-the unknown market space,untainted by competition. To give rise to completely new industries
eBay – online auction To create new from within a red ocean, by transforming boundaries of an existing industry.
Cirque du Soleil – it made a new and profitable blue ocean from within the red ocean of the circus industry, combining circus and theatre which were traditionally separated. Blue Ocean: Not A New Concept Blue Ocean Chief Executive Japanese Companies' Meteoric Rise in the 1970's and 1980's Competitive
Advantage Aspects of
Strategy Competition Developing
Blue Oceans Protecting
Blue Oceans Business Launch Revenue Impact Profit Impact Technological
Advances Fallen Trade
Barriers Globally
Available
Info. Declining
Population like the horse-drawn carriages, they were for everyday use
came in just one color – black
they were reliable and durable
designed to travel over dirty roads in rain, snow or sunshine
they were easy to use and fix
people could learn to drive in a day “Go where Profits and Growth are- and where the competition isn’t “ A consistent pattern Model T the car “for the great multitude, constructed of the best materials” Horses could easily negotiate the bumps and mud that stymied cars

Carriages were much easier to maintain than the luxurious autos
Autos frequently broke down and required expert repairmen Horse-drawn carriage 1906 “nothing has spread socialistic feeling more than the automobile” More than 500 automakers in America
Cars that cost around $ 1,500 and are available only to the rich
Anti car activities and organized boycotts 20th Century Shifting focus from Customers to Non customers to create new demand Creating new demand
Instead of fighting for existing demand in the market Market share surged from 9% in 1908 to 61% in 1921 Horse-drawn carriage
buyers 1908 - $ 850
1909 - $ 609
1924 - $ 290 Car buyers Toward Blue Ocean Strategy Automobiles Key Blue ocean Creations Was the blue ocean created by a new entrant or an incumbent? Was it driven by
technology
pioneering or
value pioneering? Incumbent Incumbent Incumbent New entrant value pioneering
(mostly existing
technology) value pioneering
(mostly existing
technology) value pioneering
(some new technology) value pioneering
(some new technology) Unattractive Unattractive Unattractive Attractive At the time of blue
ocean creation, was
the industry attractive
or unattractive? Computers Key Blue ocean Creations Was the blue ocean created by a new entrant or an incumbent? Was it driven by
technology
pioneering or
value pioneering? Incumbent Incumbent Incumbent New entrant value pioneering
(mostly existing
technology) value pioneering
(mostly existing
technology) value pioneering
(some new technology) Unattractive Unattractive Nonexistent value pioneering
(mostly existing
technology) Nonexistent At the time of blue
ocean creation, was
the industry attractive
or unattractive? Movie Theaters Key Blue ocean Creations Was the blue ocean created by a new entrant or an incumbent? Was it driven by
technology
pioneering or
value pioneering? Incumbent Incumbent Incumbent New entrant value pioneering
(mostly existing
technology) value pioneering
(mostly existing
technology) value pioneering
(some new technology) Unattractive Attractive value pioneering
(mostly existing
technology) Nonexistent Unattractive Creating blue oceans
builds brands Align the Whole System of a
Firm's in pursuit of Differentiation Low Cost Costs Buyer Value VI Blue ocean creator's business model is easier to imagine than to do. Barriers to Imitation Network externalities: the more customers, the more attractive a company looks. Patents or legal permits block imitation. Brand image conflict prevents companies from imitating a blue ocean strategy. Politics and Culture: Imitation often requires companies to make changes to existing business practices and culture. Brand Buzz: High leap in value leads to loyal followers. Customers leave directly after purchasing
No buying experience
Less turnover The Problem Create an environment
Instead of just "buy and go"
Focus on customer needs
Celebrates learning and reading
Redefine the scope of services The Idea In less than six years they emerged as the two largest bookstore chains
Customers stay longer in shops
They create a new customer experience The Result Vacuum cleaners need special bags
User must buy and change bags
Generates additional costs and annoyance The Problem The Idea No more bag changes
No more additional costs and annoying circumstances
No suction power wasting The Result Feel Free !!! Any Questions??? Thanks For Your Attention ! 03.10.2010 There are two ways to create blue oceans
Full transcript