W. Chan Kim (1952- ) and Renée Mauborgne
Kim (pictured on the left) and Mauborgne (pictured right) are strategy professors at the INSEAD Business School
near Paris.
Key book
Blue Ocean Strategy
(2005)
(see for more detail Blue Ocean Strategy in the Business
Books section)
Companies become successful because of value innovation that involves:
1. Creating blue
oceans
These are new markets with:
- differentiated (i.e. distinctive and branded) products with high profit margins.
These contrast with red oceans, full of blood from cut-throat competition.
2. Re-defining your business
For example, Cirque du Soleil saw themselves as theatrical entertainers not circus performers.
3. Combining low costs and
differentiation
(being better than competitors) .
4. Utility
levers
These are ways of achieving customer satisfaction:
- customer productivity (faster and better service).
- environmental friendliness.
5. Tipping point leadership
This is vital to motivate employees to change and innovate by:
- giving them responsibility.
- involving them in decision making.
Key quote on
strategy
The creation of blue oceans is about driving costs down while simultaneously driving value up for buyers.
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