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Blue Oceans sound like the place to be, right? They consolidated their consulting activities within a series of Blue Ocean Strategy Centres dispersed all around the world, worked for several governments including the USA, Singapore or Malaysia, and published a second book in 2017 entitled Blue Ocean Shift. How Do You Create a Blue Ocean? For instance, in the case of Blue Ocean Strategy, the book was not simply a product of academic thinking, but had involved practitioners and consultants from its inception, who in turn were instrumental in applying and disseminating the concept globally. Thus, social scientists should rely on both, given their distinctive skills, activities and networks. The impact of Blue Ocean Strategy emerged by transforming business practices and influencing both academics and practitioners through its mobilisation and interpretation, often outside of the academy, rather than through its scientific grounding. Whilst good ideas are often believed to find their own audience, Guillaume Carton argues that for research and ideas to achieve impact they require mobilization. In the 1890s, the horse and … Blue ocean strategy is based on over decade-long study of more than 150 strategic moves spanning more than 30 industries over 100 years. Chan Kim and Renée Mauborgne wrote a book called “The Blue Strategy” in 2004 which presents analytical frameworks and tools to foster an organization’s ability to systematically create and capture “blue oceans”. [vc_row][vc_column][vc_empty_space height=”50″][vc_single_image image=”1751″ img_size=”full” alignment=”center”][vc_column_text] It is the idea of trying to find market spaces that are free of competitors by creating and caputuring new demand, making the competition irrelevant. The case is so developed as to give students an insight into the causes that led to Kinetic and Honda parting ways. The Nintendo Wii launched in 2006 and at its heart is the concept of value innovation. However, beyond simply demonstrating the impact of academic research, it is also important to understand how research moves from abstract concept to concrete reality. NetJets observed that business travellers, the most lucrative mass of customers, have two principal choices: They can fly business class or first class on a commercial airline or the company can purchase its own aircraft to serve its corporate travel needs. Our roadmap to win identifies the key priorities for the next phase of our journey in health technology. Second, to benefit from this transformational power, concepts need large amounts of time! Retracing the historical development of the concept, Blue Ocean Strategy originates from a consulting project that took place between 1990 and 1996 at Philips, which brought together academics, consultants and employees and aimed at transforming the organisation. Taking the example of a concept from management studies, Blue Ocean Strategy, he details how the success of the concept was dependent on the researchers’ ability to mobilize a range of actors over a period of decades. Finally, creating change involves a reliance on a large array of people and objects. … To the kettle industry, the water issue was not its problem. This blog post is based on the author’s article, “How assemblages change when theories become performative: the case of the Blue Ocean Strategy”, published in Organization Studies. It is designed to improve the way we perform, so we deliver higher levels of customer value and quality across the board, as well as increasing shareholder value. The term impact ultimately signifies the process by which an abstract idea for good or ill becomes a practical reality. The case study examines in detail the causes for the break up of the Kinetic Honda joint venture. Understanding Blue Ocean Strategy with Examples, Pros, Cons & More: Hello readers! And it is only when all the members of an organization are aligned around a strategy and support it, … Blue oceans offer firms areas of uncontested competition easing their … For instance, as one academic explained why they were drawn to the concept: “I was told that [Blue Ocean Strategy] isn’t academically instructed enough, there were boundary conditions, it was not a testable proposition… but I said, hey you know, if I get 20 executives and I work with them to exercise, they are very happy with the results.” The impact of Blue Ocean Strategy emerged by transforming business practices and influencing both academics and practitioners through its mobilisation and interpretation, often outside of the academy, rather than through its scientific grounding. After two Harvard Business Review articles authors usually publish a book. In short, Red ocean strategy refers to competing for the existing marketplace where blue ocean strategy denotes making new uncontested marketplace. For instance, as Toby Green suggested in a recent post, moving from research to impact goes well beyond publication. The key principle of blue ocean strategy is to pursue low cost and differentiation simultaneously. Philips’ blue ocean strategic move in the teakettle industry is an example of looking across complementary product and service offerings, path four in the six paths framework. Here are a few examples of blue ocean strategic moves from a variety of different industries and sectors. Teaching is a cornerstone of such investment. On average, research and development accounts for 2.3% of OECD countries’ GDP. Taking a different approach, I have used the concept of perfomativity to analyse impactful social research. A researched case study on Blue Ocean Strategy Implementation. Blue Ocean Strategy is a book published in 2004 written by W. Chan Kim and Renée Mauborgne, professors at INSEAD, and the name of the marketing theory detailed on the book. It caught the attention of many scholars, academic researchers, and professional business parties as well as entrepreneurs. Furthermore, the aim of adopting this strategy is to search for a business in which very few firms operate and where there is no pricing pressure. Philips’ blue ocean strategic move in the teakettle industry is an example of looking across complementary product and service offerings, path four in the six paths framework. Given their growing success, they then developed the Blue Ocean Strategy Institute within INSEAD, the business school they belonged to, in order to manage help them propagate the idea further, investing particularly in the production of teaching materials. The case of Blue Ocean Strategy presents three insights into impactful research. Of the many strategic planning models that exist, the Blue Ocean Strategy could be considered the pacifist of the group. You can also check out what all the fuss about Blue Ocean Strategy is here on their site. Blue Ocean Idea Index The blue ocean idea index is a simple but robust test demonstrating how the sequence of utility, price, cost, and adoption form an integral whole to ensure commercial success through blue ocean strategy. Due, to blue-ocean strategy, yet a lot has to be research regarding the market trends by Philips. To do this requires specific skills. Notify me of follow-up comments by email. The value curve—a graphic depiction of the way a company or an industry configures its offering to customers—is a powerful tool for creating new market space. The industry was kick-started on a strong growth trajectory as people began replacing their old kettles with the new filtered kettles. Blue ocean strategy is the simultaneous pursuit of differentiation and low cost to open up a new market space and create new demand. By thinking in terms of complementary products and services, Philips saw that the biggest issue the British had in brewing tea was not in the kettle itself but in the complementary product of water, which had to be boiled in the kettle. During that project, W. Chan Kim and Renée Mauborgne benefitted from the opportunity to test the implementation of strategy tools in different divisions of the firm. The case also throws light on the post break-up strategies of the two companies. Blue oceans strategy is the approach that suggests a company is better off searching for ways to play in uncontested market places instead of engaging with competition in existing marketing spaces. It took a lot of time before Blue Ocean Strategy proved to be impactful: before working on the concept, W. Chan Kim and Renée Mauborgne authored 18 academic articles (on other topics), authored more than 12 publications in Harvard Business Review and it led to the publication of only two books! October 01, 2011 Blue Ocean Strategic Moves - Philips Consider the British teakettle industry, which, despite its importance to British culture, had flat sales and shrinking profit margins until Philips Electronics, the Dutch consumer electronics company, came along with a … Blue Ocean Strategy introduces analytical tools to minimize risk. Blue Ocean Strategy Example 1: Automobile Industry. Drawing on this experience, they generalised the methods they had put in place at Philips, by studying the long run strategies of different organisations. It is about creating and capturing uncontested market space, thereby making the competition irrelevant. Please review our comments policy if you have any concerns on posting a comment below. Hence, it was crucial to deeply analyze and develop BOS according to previous conducted studies. Blue ocean strategy is embodied by Professors W. Chan Kim and Renée Mauborgne in a book called Blue ocean strategy. Blue Ocean strategy is a framework which inspires to create a market for an innovative product or market where there is a less competition. Based on the discussion, it is safe to say that the blue ocean is a better strategy that can bring fewer … Visit our sister blog LSE Review of Books. This strategy encourages you to suspend all that you know about building success to take a leap into a new way of thinking about business strategy. In turn, research assessment bodies would be well served to recognise that impact rarely resides in single minds, events and objects, but in a far wider and long-lasting range of objects and practices. To illustrate how Blue Ocean Strategy can be used in a variety of industries, we’ll cover three very different industries – automobiles, computers, and movie theaters. Blue ocean strategy is based on over decade-long study of more than 150 strategic moves spanning more than 30 industries over 100 years. Performativity, derived from the field of science and technology studies, looks to understand how theories both describe reality in an abstract sense, but more importantly also become materially embedded within actors and objects to change these realities. Profit Model of Blue Ocean Strategy 30. It was the problem of another industry—the public water supply. His research interests include management knowledge production, science and technology studies, and performativity studies. Impact therefore not only requires working to create the best academic idea, but also working to give that idea traction. Public interest in the concept led to further consulting projects organised within a consulting network and to the publication of teaching cases aimed at training managers. Blue Ocean Strategy has been successful, partly in thanks to its ability to be translated into different strategy tools and articles intended for and incorporating different audiences. These therefore, give an organization an advantage in the market and put a company in a new growth path different from its competitors. There is a 21-year timespan between W. Chan Kim’s PhD viva and the publication of Blue Ocean Strategy. The issue was the limescale found in tap water. To reconstruct market boundaries and create new market space, think about applying path four of blue ocean strategy’s six paths framework. Select from the icons below to learn more. This will also give you a good introduction to the concept as well as information on how companies such as CEMEX, Apple (Itunes), Philips, Raulph Lauren and even Viagra (yes, those annoying spammers!) It is a new day and we are back with a new topic of discussion exclusively for you all! Updated/Revised 2016 The media industry in Pakistan is rapidly growing. LG Electronics: The Blue Ocean Strategy “A company is not only top management, nor is it only middle management. Based on an eponymously titled book, this strategy argues that “cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool.”Companies should instead look for new market space and ways to reinvent the industry. To make its digital market strategy sustainable and successful in market. “Blue Ocean Strategy” is a book published a few years ago, written by W. Chan Kim and Renée Mauborgne, professors at INSEAD and co-directors of the INSEAD Blue Ocean Strategy Institute. A company is everyone from the top to the front lines. This includes putting increased emphasis on both primary and secondary prevention and population health management programs. The result: Philips created a kettle with a mouth filter that effectively captured the limescale as the water was poured. This reinforces the view that a long-term perspective of research and career paths is necessary to understand impact generation. Blue ocean strategy, is a result of study of decade-long study of more than 150 strategic moves spanning more than 30 industries over 100 years (1880-2000). In this post, I want to consider the whole process of research impact and what insights from influential social research can tell us about the mechanisms underpinning impact. Featured Image Credit adapted from Berenice Melis, via Unsplash (CC0 1.0). How this money is invested, transformed into practice and its overall impact on the well-being of citizens is a critical concern for individuals, organisations and governments. have successfully applied the Blue Ocean Strategy. The phlegmatic British typically took a teaspoon and went fishing to capture the off-putting limescale before drinking home-brewed tea. - The 2-minute Ritual Proven To Eliminate 1 Pound Per Day Of Dangerous Belly Fat. It was published by Harvard Business School Press. NetJets reconstructed market boundaries to create a blue ocean by looking across alternative industries. Blue Ocean Strategy is considered to be one of the main pillars in the field of strategic management. Thus, if social scientists want their ideas to be transformative, they might keep in mind that generating impact is not only about getting the best idea, but also and more importantly about investing in people and objects. The limescale accumulated in kettles as the water was boiled, and later found its way into the freshly brewed tea. Developing a concept is a long and chaotic process that cannot always be assessed within normal research assessment regimes. Myth: You must be first to market to have a successful blue ocean strategy. Blue Ocean Strategy is an approach to business that doesn’t concern itself with the competition. To find out more about cookies and change your preferences, visit our, Series: Rapid Response Publishing in Covid Times, Subscribe to the Impact Blog via Email or RSS, How assemblages change when theories become performative: the case of the Blue Ocean Strategy, Creative Commons Attribution 3.0 Unported. This is a key principle of blue ocean strategy which sees low … To do otherwise risks recognising only instrumental ‘quick-fix’ solutions. The research of W. Chan Kim and Renée Mauborgne focused on discovering the common factors that lead to the creation of blue oceans and the key differences that separate those winners from the mere survivors and those adrift in the red ocean.The database and research have continued to expand and grow over the last ten years since the first edition of the book was published and the strategic moves we studied depict similar patterns, whether blue oceans were created in for-profit industries, non-profit organizations, or the public sector. Generating impact involves engaging with stakeholders and creating different forms of connection within practice. When it comes to people, academics and practitioners equally contribute to performing realities. Limescale would never again be found swimming in British home-brewed tea. Your email address will not be published. In other words, impact is less about translating abstract ideas into practical ones and more about mobilising different actors and objects that give life to an idea. ... Philips CD-I, and the Motorola Iridium satellite phone were all technological innovations, but failed to create substantial customer value. They assert that these strategic moves create a leap in value for the company, its buyers, and its employees while unlocking new demand and making the competition irrelevant. What does Blue Ocean Strategy tell us about the impact of social research? Studying the case of Blue Ocean Strategy through a performativity lens reveals how orchestrating networks that bring together, academics, consultants, strategy tools, practitioner-oriented articles, books, teaching materials, etc., is inherent to the process of transforming theoretical ideas into practical realities. Blue ocean is a slang term referring to the uncontested market space of an unknown industry or innovation. Guillaume Carton is an Associate Professor at Institut Supérieur de Gestion. Writing about impact has rightfully been critiqued for focusing on success stories and neglecting the wider contexts in which research becomes influential. The first example of blue ocean strategy comes from computer games giant, Nintendo, in the form of the Nintendo Wii. Therefore, the Blue Ocean strategy is meant to create uncontested market space for a product, make the market competition irrelevant, create and capture a new demand, and finally to break the value cost trade off. Books, articles or strategy tools, are just as important as people for making a concept a reality. Chris Cvitanovic and myself have previously discussed how boundary-spanning roles necessitate the ability to speak the language of both practice and research. We use cookies to ensure you get the best experience on our website and continuing implies your consent -. An example of a successful execution of a blue ocean strategy is the iPod. Philip Kotler explains how to create your marketing strategy according to 'Blue Ocean Strategy'. First, social scientific ideas have substantial transformational power that may not always derive from coherent academic grounding. Despite its importance to British culture, the British teakettle industry had flat sales and shrinking profit margins until Philips Electronics, the Dutch consumer electronics company, came along with a teakettle that turned the red ocean blue. Almost all of us have been to beaches for a weekend getaway or long vacations! It was the beginning of a series of publications aimed primarily at practitioners, which publicised the strategy tools they had begun to develop. This text states that companies may be successful not so much by beating competition but rather by creating new markets. Charting the impact of Blue Ocean Strategy. It drives you to look across complementary products and service offerings to discover ways to create a leap in value. I focused on this case because of its exceptional diffusion: the book outlining the theory was published in 2005 and has sold more than 4 million copies, the concept is taught in more than 2,500 universities in almost all countries over the world and its two authors, W. Chan Kim and Renée Mauborgne, were recognised in 2019 as the best management thinkers by the Thinkers 50 ranking. Philips sees significant value in more integrated forms of healthcare, unlocking the power of data and artificial intelligence at the point of care, while at the same time optimizing care delivery across the health continuum. #BlueOceanShift and #BlueOceanStrategy are worldwide business strategy bestsellers, helping you to move beyond competing and start creating your #blueocean. He is also concerned with the relationship between management theory and managerial practice. Required fields are marked *. So the strategy that I am going to share with you is called the Blue Ocean Strategy, derived from the Book Blue Ocean Strategy. Your email address will not be published. To accept cookies, click continue. To do so, I took as an example the strategy concept Blue Ocean Strategy, which encourages managers to create new market spaces, rather than competing within existing ones. However, it was not until 2005, and not two but seven articles, that W. Chan Kim and Renée Mauborgne published Blue Ocean Strategy. This study led to the publication in 1997 of a first article published in the practitioner-oriented journal Harvard Business Review. We use cookies on this site to understand how you use our content, and to give you the best browsing experience. Note: This article gives the views of the author, and not the position of the LSE Impact Blog, nor of the London School of Economics. By thinking in terms of solving the major pain points in customers’ total solution, Philips saw the water problem as its opportunity. Retracing the historical development of the concept, Blue Ocean Strategy originates from a consulting project that took place between 1990 and 1996 at Philips, which brought together academics, consultants and employees and aimed at transforming the organisation. Discover ways to create substantial customer value competing and start creating your blueocean. Experience on our website and continuing implies your consent - second, to blue-ocean strategy, yet a lot to! To capture the off-putting limescale before drinking home-brewed tea capture the off-putting limescale before home-brewed! Value innovation developed as to give that idea traction accounts for 2.3 of! Can also check out what all the fuss about blue Ocean strategy an. Best browsing experience Mauborgne in a recent post, moving from research to impact goes well beyond publication the. 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