Blue Ocean Strategy Takeaways

1. Blue Ocean StrategyTakeaways TEAM 4 Carly Buell Ryan Buell Brian Cote Shana Hartford April Miller Brittany Snethkamp Austin Stewart How to Create Uncontested Market Space and Make the Competition Irrelevant

2. Red Ocean: Companies compete for customersBlue Ocean: Company creates a new market Red Ocean Strategy • Focus on existing customers • Compete in existing market space • Beat the competition • Exploit existing demand • Make the value-cost trade-off • Align the whole system of a firm’s activities with the strategic choice of differentiation or low cost Blue Ocean Strategy • Focus on non-customers • Create uncontested market space • Make the competition irrelevant • Create and capture new demand • Break the value-cost trade-off • Align the whole system of a firm’s activities • in pursuit of differentiation and low cost

3. Value Innovation Decrease Costs GOAL Increase value to customer

4. Analytical Tools and Frameworks • Strategy Canvas • Four Actions Framework • Eliminate-Reduce-Raise-Create Grid 3 Characteristics of Blue Ocean Strategy • Focus • Divergence • Compelling Tag line

5. The Strategy Canvas • Captures the current state of play in the known market space • It propels you to action by reorienting your focus from competitors to alternatives and from customers to noncustomers of the industry

6. The Four Actions Framework Reduce Which factors should be reduced well below the industry’s standard? Eliminate Which of the factors that the industry takes for granted should be eliminated? Create Which factors should be created that the industry had never offered? A New ValueCurve Raise Which factors should be raised well above the industry’s standard?

7. The Four Actions Framework & The Eliminate-Reduce-Raise-Create Grid

8. Reconstruct Market Boundaries6 Paths Framework 1.Look Across Alternative Industries 2.Look Across Strategic Groups Within Industries 3.Look Across the Chain of Buyers 4.Look Across Complementary Product and Service Offerings 5.Look Across Functional or Emotional Appeal to Buyers 6. Look Across Time

9. 4 Steps of Visualizing Strategy • Visual Awakening: See where you are • Visual Exploration: See how others see you • Visual Strategy Fair: See where you could be • Visual Communication: Draw a map for everyone (Pioneer-Migrator-Settler [PMS] map)

10. Three Tiers of Noncustomers 1st Tier: Soon to be Noncustomers 2nd Tier: Refusing noncustomers 3rd Tier: Unexplored noncustomers 3rd Tier 2nd Tier 1st Tier Your Market

11. Sequence of Blue Ocean Strategy Buyer Utility No- Rethink Is there exceptional buyer utility in your business idea? Yes Price No- Rethink Is your price easily accessible to the mass of buyers? Yes Cost Can you attain your cost target to profit at your strategic price? No- Rethink Yes Adoption What are the adoption hurdles in actualizing your business idea? Are you addressing them up front? No- Rethink Yes A Commercially Viable Blue Ocean Idea

12. Buyer Utility Map Six Stages of the Buyer Experience Cycle Six Utility Levers

13. 4 Organizational Hurdles to Strategy Execution COGNITIVE HURDLE an organization weeded to the status quo RESOURCE HURDLE limited resources POLITICAL HURDLE opposition from powerful vested interest MOTIVATIONAL HURDLE unmotivated staff

14. Tipping Point vs. Conventional Wisdom Conventional Wisdom - Focus on the mass of employees for change Tipping point - Focus on the extremes for fast shift at low cost

15. A Visual of How Fair Process Affects the Workplace

16. The Execution Consequences of the Presence and Absence of Fair Process in Strategy Making

17. 6 Principles of Blue Ocean Strategy • Formulation Principles 1. Reconstruct market boundaries 2. Focus on the big picture, not the numbers 3. Reach beyond existing demand 4. Get the Strategic sequence right • Execution Principles 5. Overcome key organizational hurdles 6. Build execution into Strategy • Risk Factor each principle attenuates • Decrease search risk • Decrease planning risk • Decrease scale risk • Decrease business model risk • Risk Factor each principle attenuates • Decrease organizational risk • Decrease management risk