Blue Ocean Strategy Criticism

Moreover, If you’re a company owner and you make a product you don’t want competition. But once about only ten percent of people in America own a business or company there is gonna be competition. As a consumer you want competition it forces the companies to make better goods and provide better services for cheaper more fair prices. Which then allows you to be able to buy more goods and services. Which then allows you to be more successful in life and achieve more goals and those goals faster.

Managers generally consider the rivalry among competitors as a major source for deriving strategy. As explained by the Michael Porter it is a narrow view of competition. A set of other parameters should be evaluated, mentioned in article as five competitive forces, along with industry

3. Describe at least 3 nonprice competition strategies a company could use to convince customers that its product is better than other similar products. Why would those strategies matter to customers? (1-6 sentences. 3.0 points)

A new firm needs to make a trade off between performance and compatibility by employing an evolution strategy (offering a migration path) or a revolution strategy (offering superior compelling performance). A firm also needs to make a trade off between being an open system or a closed system as open technologies are popular but rewards are not as desirable as a proprietary technology holder. By using these strategies, firms in network markets approach by using one of the generic strategies from performance play, controlled migration, open migration and discontinuity.

Businesses are not only faced with competition within the industry they operate in. They also face competition from businesses in other industries.

Any company’s survivability in the market place needs to take into consideration both an effective market strategy and non-market strategy. A company’s method of strategically dealing with its suppliers, customers, and competitors is called their market strategy. Non-markets strategy is all the interactions outside of suppliers, customers, and competitors. These non-market entities include, but are not limited to, activist groups, government agencies, legislators, public opinion, and the media. Therefore, a company can have a competitive\effective marketing strategy that places their products or services in the forefront of the marketplace; however there are forces outside of their market strategy that influence their market share. Thus, a

Competition being one of the major issues that often must be addressed in the business world, it is important for a firm to learn on ways to reduce the impact of the competition. Competition is definitely an important factor in helping a business

It can help to pull customers’ needs and preferences in a direction where you want them to go, which is ideally away from the competition’s trends. This has a double effect of you taking market share from them, and making R&D pricier for the competition. It’s also riskier, because at an initial point you have make that same big expenditure yourself, and it may not work, or the competition is doing something equal or superior.

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

All companies desire to dominate any given market without being outfought or outwitted by rivals. However, the implications of

“Competition is not only the basis of protection to the consumer, but is the incentive to progress” – Herbert Hoover. The environments that today’s firms operate in are not static. The competitive environment they are operating in is constantly changing due to the entry or exit of competitors, changing technology and the demands of consumers. In order to maintain their market share and profitability, firms must continually assess and evaluate their competitive environment. Evaluating the various market forces firms’ face, and their effect on the competitive market ensures that an organization retains a proactive stance to the competitive environment. Instead of just accepting the status quo, organizations that actively examine and analyze their environment can then make choices and develop strategies that take advantage of the competitive situation or affect it to the firm’s benefit. This proactive stance to the market allows organizations to create value and position themselves for long term success. Firms that do not remain proactive and continually scan the competitive environment run the risk of being blindsided by innovation in the environment or significant changes undertaken by the competition.

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.

Competitive analysis is an important part of your business plan, there are a lot of different alternatives in the market, costumers usually look for different sets of values to focus on, benefit levels and what does the item include when they are choosing where to buy the product from. Even though costumers usually choose similar products to those alternatives, and that’s where competition is created.

Competition: As time goes on firms drop out until no one is producing the product.

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)