Blue ocean strategy

Blue Ocean Strategy

How to Create Uncontested Market Space and
Make the Competition Irrelevant

To friendship and to our families,
Who make our worlds
More meaningful

Preface
Our research confirms that there are no permanently excellent
Companies, just as there are no permanently excellent industries.
As we have found on our own tumbling road, we all, like corporations,
Do smart things and less-than-smart things. To improve the
Quality of our success we need to study what we did that made a
Positive difference and understand how to replicate it systematically.
That is what we call making smart strategic moves, and we
Have found that the strategic move that matters centrally is to create
Blue oceans.
Blue ocean strategy challenges companies to break out of the red
Ocean of bloody competition by creating uncontested market space
That makes the competition irrelevant. Instead of dividing up existing –
And often shrinking – demand and benchmarking competitors,
Blue ocean strategy is about growing demand and breaking
Away from the competition. This book not only challenges companies
But also shows them how to achieve this. We first introduce a
Set of analytical tools and frameworks that show you how to systematically
Act on this challenge, and, second, we elaborate the
Principles that define and separate blue ocean strategy from competition-
Based strategic thought.
Our aim is to make the formulation and execution of blue ocean
Strategy as systematic and actionable as competing in the red waters
Of known market space. Only then can companies step up to
The challenge of creating blue oceans in a smart and responsible
Way that is both opportunity maximizing and risk minimizing. No
Company – large or small, incumbent or new entrant – can afford to
Be

a riverboat gambler. And no company should.
The contents of this book are based on more than fifteen years of
Research, data stretching back more than a hundred years, and a series
Of Harvard Business Review articles as well as academic articles
On various dimensions of this topic. The ideas, tools, and
Frameworks presented here have been further tested and refined
Over the years in corporate practice in Europe, the United States,
And Asia. This book builds on and extends this work by providing a
Narrative arc that draws these ideas together to offer a unified
X Preface
Framework. This framework addresses not only the analytic aspects
Behind the creation of blue ocean strategy but also the allimportant
Human aspects of how to bring an organization and its
People on this journey with a willingness to execute these ideas in
Action. Here, understanding how to build trust and commitment, as
Well as an understanding of the importance of intellectual and
Emotional recognition, are highlighted and brought to the core of
Strategy.
Blue ocean opportunities have been out there. As they have been
Explored, the market universe has been expanding. This expansion,
We believe, is the root of growth. Yet poor understanding exists
Both in theory and in practice as to how to systematically create
And capture blue oceans. We invite you to read this book to learn
How you can be a driver of this expansion in the future.

PART ONE
C H A P T E R 1
Creating Blue Oceans
AONE TIME ACCORDION PLAYER, stilt-walker, and fireeater,
Guy Laliberté is now CEO of Cirque du Soleil,
One of Canada’s largest cultural exports. Created in 1984 by a group
Of street performers, Cirque’s productions have been seen by almost