Blue Ocean Strategyabout winning without fighting

to fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy's resistance without fighting

Master Sun Tzu in Art of War

BLUE OCEAN STRATEGY

Conventional Strategy DIFFERENTIATION OR LOW COST

Blue Ocean talks about Value InnovationDIFFERENTIATION AND LOW COST

Value Innovation Region where a companys

actions favourably affect both its cost structure and its value proportion to buyers

Cost savings by eliminating and reducing the factors an industry competes on

Buyer values is lifted by raising & creating elements the industry has never offered

Over time, costs are reduced further as scale economies kick in

Buyer Value

Costs

Value Innovation

Comparison of Red vs. Blue

How to find new Value Curve Four Actions Framework

Eliminate Which of the factors that the industry takes for granted should be

eliminated?

Reduce Which factors should be reduced well below the industry's

standard?

Raise Which factors should be raised well above the industry's

standard?

Create Which factors should be created that the industry has never

offered?

Case Study 1 : US Wine Industry Pre-Yellow Tail

Case Study 1: US Wine Industry Post Yellow Tail

Case Study 1 :Value Curve for Yellow Tail Eliminate

Enological Terminology Above the Line Focus on Aging Quality

Reduce Vineyard Prestige & Legacy Wine Complexity Wine Range

Raise Price as compared to Budget Retail Store Environment

Create Easy Drinking Ease of Selection Fun & Adventure

Case Study 2 : US Women Exercise Pre Curves

Case Study 2: US Women Exercise Post Curves

Case Study 2 :Value Curve for Curves Reduce

When compared to traditional gym Price Amenities Equipment Workout time Availability of instructors

Raise Environment encouraging discipline & motivation Same sex non-threatening

Create Womanly fun atmosphere

Case Study 3 : Cricket Before IPL

Case Study 3: Cricket After IPL

Case Study 3 :Value Curve for IPL Reduce

Spectator Time Invested (Competes with Movie/Football) Emphasis on Classic Techniques (Batting/Bowling) Emphasis on Patience, Perseverance

Raise Emphasis on Athleticism Pace of the Game Entertainment with Bollywood, Cheerleaders etc. Certainty of Result

Create City Loyalty Welcome to Dummies

Is Tata Nano Really Creating a Blue Ocean ?

skillful leader subdues the enemy's troops without any fighting; he captures their cities without laying siege to them; he overthrows their kingdom without lengthy operations in the field

Master Sun Tzu in Art of War

Reference : Blue Ocean Strategy By W. Chan Kim, Rene Mauborgne