Blue Ocean Strategy

Blue ocean strategy dwells on the lengthy study of moves than 150 strategic counts and stretches over 30 industries in a time period of 100 years. The industries that were analyzed comprised of cinema, airlines, computers, automobiles, etc. The perspective of Blue Ocean leads to the evolution of new ideas instead of limiting it. The horizon is expanded and ensures that the movement is in the correct direction. The key aspects of blue ocean strategy are as follows:

The presence of Blue ocean strategy ensures that the correct and framework is present in the organization.  The presence of different tools provided by the Blue Ocean strategy ensures that the competition can be faced with ease and leads to a development of uncontested market space. The arena of strategy, by contrast, has provided a strategy on how to compete in the market space.  This leads to the creation of tools that are analytical in nature and the framework helps in attainment of the goals. Blue Ocean strategy is based on the pattern of a common strategy. The patterns have allowed the development of a strong framework and the methodology has ensured link innovation that is systematically linked so that the boundaries of the industry can be valued and reconstructed. The framework that comprises of visual and actions leads to shedding of light on the projection of the unconstructed problem. A roadmap is being provided for critical visual guidance for pursuing systematically value innovation and creation of market space that is uncontested. Hence, companies can make changes of proactive nature.

The opportunities are maximized while risk is minimized. It is one of the best and unique result that can be attained by the application of this mechanism. Blue Ocean strategy can be described as a strategy that maximizes opportunity and minimize risk. The presence of blue ocean strategy leads to the mechanism of robust nature to lessen the risk and enhance the level of success. The Blue Ocean Index is a major and key framework. The Blue Ocean Idea Index enables testing of the commercial viability of the blue ocean ideas and enables how to refine the ideas to enhance the upside while reducing the downside risks. Four major questions can be answered through it that is is there a major reason for the public to purchase the offering? Secondly, is it directed to the masses so that they can purchase it at the prevailing price? Thirdly, can the offering be produced at the strategic price and reap a strong profit? Lastly, the hurdles in the process of adoption are being discussed.

Innovators Dilemma

 Another key aspect of Blue Ocean strategy is to create market space of an uncontested nature. it further strives to make the competition irrelevant in nature by reconstruction of the boundaries. The conventional method is more directed towards the functional area. The main aim over here is to stress upon the advantages that they possess. On the contrary  blue ocean strategy influences them to come out from the boundaries and define new concepts. Hence, the focus moves to across the blue ocean strategy and break out from the orthodox movements. This leads to creation of new, as well as market space that is uncontested and has high profitable growth.

The execution is transformed into strategy. The process, as well as tools ate exclusive in nature and easier in terms of communication. The blue ocean strategy can be defined as a strategy that connects analytics with the dimension of the human or organization. It lays emphasis and pay heed to the importance of interlinking with the mind of the people with a new defined strategy so that when it comes to the individual level, people embrace it of their own and hence is in a situation to move beyond  the mandate execution to voluntary cooperation in implementing this. To ensure that, this happens blue ocean strategy does not differentiate strategy formulation from execution. Blue ocean strategy ensure a strong execution into strategy that initiates through the movement of process that is fair in nature in the making, as well as rolling of strategy. Fair process consists of engagement, explanation, as well as preparation for the implementation by invoking the fundamental pillars of trust, commitment and cooperation of the organization.

The innovator dilemma can be defined as a business classic that projects the disruption power and states why the market leader is nor successful in terms of technologies and variance in the industry and the role of incumbents in this process to secure the leadership in the market for a prolonged time.

The key aspect of innovator dilemma is as follows

The targeting of an incumbent should never be done with the sustaining solution

A sustaining innovation is one that enhances the product for the customers who exist providing them with enhanced features, better performance, and more options. Sustaining innovation can be defined as the most common and helps the companies to escalate the product from not-good-enough in the early stages to being more-than-good-enough in the later stages.  A sustaining solution should never be utilized to compete with an incumbent. The incumbent organization can be defined as the one with all the available resources that is the customer base and the motivation to fight any danger that comes from the new competitor. In any situation, the incumbent will win if they are threatened by a technology that is sustaining in nature. They will simply ensure in what they are good at and serve the customer with the enhancement of the product.

Key Aspects of Blue Ocean Strategy

The innovator dilemma is to penetrate the market from below. It lay emphasis on the fact that the product should be created that is not as proper as the incumbents, however, it is cheaper, easier or more convenient.  Hence, it is imperative that the target should be done on a lower profit margin. The incumbent will lead to the removal of low margin business and concentrate on higher growth.

Good management

It is the middle-level management that plays a leading role in weeding the ideas. The main emphasis is on the idea that will have high conversion rates. Sustaining technology is easy in this scenario for identification. When it comes to the concept of well-run companies, it will automatically move towards ideas that keep the company propelling forward in terms of strong profit scenario and high level of product for the customer. Hence, good managers are doing the role that is needed to in terms of shifting the sustaining technology and curtailing the ones that are disruptive in nature.  From the dilemma, it is clear that the manager can suffer a strong setback when they back up a project that fails. When it fails for the purpose or reason of technology then it is not harmful in nature, however, if it fails for lack of market then it is highly damaging in nature.

However, when the company is ready to pursue a new technology then the cost network and value can lead it to failure. For instance, the sales and marketing department might not support the new technology as they fail to cater to the customer requirement that means innumerable decision goes against the disruptive technology.  

Be patient for growth, and impatient for profit

The main challenge that the company face is that of a funding problem for the innovation that is disruptive in nature. Further, if the market size is small the return will be small too. This is due to the fact that disruptive innovation should begin at the low end of the market and ensure a formidable work that disrupts the incumbents. Further, when it comes to the prospect of investment it means investment into new growth initiative is good money until the time the business is healthy.  But when the scenario changes and the business come under immense pressure then the good money transforms into a bad one. Such a pressure abstain the innovator to go through the strategy and trace the disruptive innovation.

The Execution is Transformed into Strategy

Lean start-up

The lean start-up leads to an approach that is scientific in nature and manages the start-ups to provide the desired product to the hands of the customer in a faster manner. It is one of the methods that teaches how to initiate a startup, how to steer, when to turn and when to accelerate the business. It is an approach that is principled in nature to the development of a product.

The methodology of lean startup has a major premise that the startup is a grand experiment to provide an answer. This method helps in ensuring an answer to the question that whether the product should be built and whether a business can be sustainable or not in terms of product or services. This experiment can be termed as more than the theoretical inquiry. If it is successful it will enable the manager to get started with the campaign thereby adding an employee to every experiment and leading to the establishment of the product. Decision making becomes easy with the help of lean start-up process as it helps in solving real problems and provide a detailed specification of what needs to be established.

In manufacturing the progress is ascertained by the production of goods that are of high quality. Lean start-up process is validated through a strong method for the progress of demonstration when there is strong level of uncertainty. Once the process of validate learning is implemented, the process of development can shrink in nature. The Lean Startup approach is beneficial in the manner that the companies can build order and not chaos. It is due to the premise that the tools helps in creation of vision on a continuous platform.  Such a vision helps in creating a strong status leading to a strong process of decision making. When the decision making is strong and unique it leads to additional benefits. The entrepreneurs can plan accordingly when the vision of the organization is clear. Further, uncertainty is eliminated that leads to a better prospect and smooth course of action. The lean start-up process is directed in a fashion that leads to the growth of the business. The strategies can be properly ascertained and directed when the lean start-up process is into action. The presence of lean start-up helps in gathering up of idea and builds them into code followed by the measure that helps to create data and then leading to idea. The presence of this tool enables transformation and the loop time is less when it comes to this tool.  Further, removal of uncertainty leads to an enhanced procedure and helps in getting the process on track. Through this process, the process of learning is highly influenced. The process consists of actionable metrics that leads to the projection of cause and effect question. The benefit of this startup resides in the fact that the process does not initiate with the business plan rather begin with the search of a model of business. After some rounds of experiment and feedback, a model that can be fruitful and result oriented is put into execution. Hence, the overall discussion stress upon the fact that lean start-up is highly beneficial to the start-ups. Furthermore, the lean start-up process is not only limited to a individual ventures rather is a potent tool that is utilized by the big companies. Lean process is changing the entire process of the start-ups and hence, must be used in a manner that is result oriented. Hence, it can be said that the lean method will provide a strong solidity to the start-ups leading to an effective decision making and implementation of success. This method is better as compared to the traditional mechanism that is vulnerable to failure.