Blue Analysis : Blue Ocean Strategy

Due to the growing competition and diminishing market share, companies are opting for different strategies to achieve their survival objectives as well as growth. Companies are thus executing grand strategies to provide their businesses with a clear direction for its strategic actions. These strategies, therefore, aim at both short term and long term sustainability and growth, and they include innovation, market development, product development, and concentration.

95% of the ocean has not been explored. With all the species and environments within the ocean that we have discovered, it is mind blowing to think that we have only seen 5% of what the ocean has to offer. The World is Blue: How Our Fate and the Ocean’s are One explores our long standing relationship with the ocean. This book is penned by oceanographer, explorer, and lecturer, Sylvia Earle. She earned her B.S degree from Florida State University, M.S and PhD from Duke University, and has accumulated 22 honorary degrees. She has worked as a director for multiple corporate and nonprofit organizations and as chief scientist for the National Oceanic and Atmospheric Administration [1]. Earle’s research concerns marine ecosystems with an emphasis on conservation, which is the focal point of her novel. It is woven with stories compiled from decades of work and exploration, and with facts and arguments concerning our changing ocean. Sylvia’s novel is about the relationship between humans and the ocean, whether it be through the extinction of species, climate change, or even exploration and aquaculture, we ultimately affect the ocean and it affects us.

The kind of competition market described previously is an example of a Red Ocean Strategy. The market is oversaturated with companies

Corporate-level strategies are liable for market definition; they address the entire scope of the business. This strategy helps a business to diversify its service. It gives them direction in which geographic region they should operate and which service markets to strive in. “Thus, an effective corporate-level strategy creates, across all of a firm’s businesses, aggregate returns that exceed what those

Strategy formulation has been acknowledged as one of the most crucial factors of ensuring the long-term growth of the business. However, the manner in which strategy is formulated, and most importantly, the nature of the strategy chosen for the company determines its future position in the marketplace (Grant, 2005).

This blue ocean strategy separates from the current Red Ocean strategy because there is no previous example of business partnerships in this magnitude. In order for customers to get more incentive to drive to the Sears and Kmart stores after forming business alliance with Amazon, Walsh Strategic Consulting recommends that the customer should be able to earn points for all store purchase including products from

W. Chan Kim (chan.kim@insead.edu) is the Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International Management at Insead in Fontainebleau, France. Renée Mauborgne (renee.mauborgne@ insead.edu) is the Insead Distinguished Fellow and a professor of strategy and management at Insead. This article is adapted from their forthcoming book Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business School Press, 2005).

Kim, W. Chan, and Renée Mauborgne. "Blue Ocean Strategy." Davidhenard.com. Harvard Business Review. Web. 22 Oct 2013. .

The three-horizons framework suggests that companies must think about themselves. The company should follow some guidelines, for example: “How compete?”; “What activities are better?”; “How to defend the core business?” and so on…

1. Jet Blue´s Business- level strategy; value and cost drivers Jet Blue uses to create and maintain ist competitive position

This is done by creating a leap in value both for the buyers as well as for the organization thereby creating a new and uncontested market space. Companies left out in the red ocean usually follow a conventional approach, running to beat competition by creating a defensible position in the current market space order.

This strategy seem challenging since this strategy focus on capture new market and new demand, which it’s required extra efforts in term of innovation of products and promotion in order to make customers realize about their product. Even there are some discussions about the blue ocean strategies; however, based on my review on customers comment said that the practical guidance on how to create them is limited. Therefore, without usual analytic framework which can be used as guidelines to create blue oceans as well as effective principles to manage risk, creating blue oceans viewed as too risky for managers to pursue as strategy for their company.

There are six principles of blue ocean strategy, for formulation principles, the first is reach beyond existing, second reconstruct market bounndaries, third is focus on the big picture, not the numbers, get the strategic sequence right and the execution principles is overcome key organizational hurdles and build execution into strategy.

The code name we gave to our project is ¡¥Low Bap¡¦: the sound of boots of an army when is marching in the battlefield. With this name we compare the business corporations of the present with the huge armies of the past. In this way, we could consider BT as a big army of the past, which has to be kept in a continuous march so as to meet our targets both in short and long-term. Regarding the number of the consumers that are involved and the size of funds, which are going to be used, BT¡¦s strategy will be an example that may have both a positive or negative effect to the Global business field in the future. It is up to us to build BT¡¦s fame as an innovative strategic planner or another bureaucratic plodding giant.

There are some tool produce to help implement blue ocean strategy. The Eliminate-Reduce-Raise-Create (ERRC) Grid is the matrix that help execute blue ocean strategy with the four action framework: eliminating, reducing, aising and creating. ERRC Grid help company to remain on their competitive factors. Eliminating and reduce the factor that the transitional industry take it for granted can help the new strategy to remain unique from the transitional market. Nevertheless, raising and creating some unique competitive factor the transitional market never or seldom offered that is above the industry standard. With all these “Four Actions Framework” the company can escape the transitional red ocean market by activate a new blue ocean market and create a new value curve. (Kim & Mauborgne, 2005)