John Stewart Katie Kringele Heather Hignojos

Creating Blue Oceans Blue oceans are usually created as a result of red oceans When a market becomes oversaturated, boundaries have to be expanded to create a blue ocean Examples: asdf “We reinvent the circus.”Created as a result of prohibition

The Strategy Canvas An analytical framework that is central to value innovation and the creation of blue oceans Change your strategic focus from competitors to alternatives, and from customers to noncustomers It allows companies to see the future in the present and to focus on the big picture

Characteristics of a Good Strategy Focus Focus on areas you know you can conquer Southwest focuses on friendly service, speed, and point-to- point departures Diverge Focus on what the industry is doing, and do different Southwest pioneered point-to-point travel between mid-sized cities Tagline Delivers a clear message, but advertises truthfully “The speed of a plane at the price of a car.”

Reconstruct Market Boundaries Tendencies that companies have when building strategy The 6 Paths Framework Six basic approaches to remaking market boundaries Learn strategy to create new “blue oceans”.

Tendencies that Companies Have When Building Strategy Define their industry similarly and focus on being the best within it Look at their industry through the lens of generally accepted strategic groups, and strive to stand out. Focus on the same buyer group (purchaser, user, influencer) Define the scope of the products and services offered by their industry similarly. Accept their industry’s functional or emotional orientation. Focus on the same point in time- and often on current competitive threats- in formulating strategy.

The 6 Paths Framework There are 6 basic approaches to remaking market boundaries. Look Across Alternative Industries Look Across Strategic Groups Within Industries Look Across the Chain of Buyers Look Across Complimentary Product and Service Offerings Look Across Functional or Emotional Appeal to Buyers Look Across Time

Reach Beyond Existing Demand Third Principle of Blue Ocean Strategy - Reach beyond existing demand Two Strategy Practices - Focus on existing customers - Drive for better segmentation to accommodate buyer differences

Strategic Sequence  Use this strategic sequence to start a blue ocean strategy  If no buyer utility present, then there is no blue ocean potential to begin with  Can use other models to go through this sequence  A business model built in this sequence produces value innovation Buyer UtilityPriceCostAdoption Commercially Viable Blue Ocean Idea

Build Trust, Commitment, and Voluntary Cooperation  To build trust, commitment and voluntary cooperation, companies need to build execution in to strategy from the start  Using the fair process can make a company’s best execution efforts  By organizing the strategy formulation process around the principles of fair process, you build execution in to strategy from the start

Overview Get out of red oceans and create blue oceans Make competition irrelevant Focus on the big picture