Blue Ocean Strategy: Analysis Of The Blue Ocean Strategy

In the contemporary business environment with cutthroat competition, establishing an appropriate business strategy is of paramount importance in order to respond effectively to rapid change in business environment. Kodak, once one of the leading companies in film and camera industry, collapsed with the advent of digital photography era. Despite the fact that Kodak dominated the film and camera market in the world and invented the first digital image sensor for digital photography in the late 20th century, its misplaced strategic move that focused on film industry resulted in bankruptcy in 2002 [1, 2]. The failure case of Kodak will suffice to illustrate the importance of business strategy. Most books and research literature on business strategy have been oriented towards outperforming rivals in a competitive market. However, expected growth and profit become low as competition amid market participants grows in intensity. Thus, a fresh approach to deviate from fierce competition is required. “Blue Ocean Strategy”, written by W. Chan Kim and Renee Mauborgne, gives new insight into how a company should establish its business strategy in pursuit of new demands and the potential for high growth. The present essay on “Blue Ocean Strategy” aims to carefully examine the concept of the blue ocean strategy in the following manner: overview of the blue ocean strategy concept, its newness and advantages, and limitations embedded in the blue ocean strategy.

Kim and Mauborgne categorized the business market universe into two distinct kinds: red and blue ocean. Red oceans denote the existent and known industries with well-defined industry boundary lines where firms fiercely contend for stagnant market share. Companies fight for a greater market ...

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...cean, but it is an empty, dead market space as long as there is no customer willing to buy products and service offerings. On top of that, differentiation itself is immensely tough when the market is so fragmented that there are diverse product and service offerings already. The bottom line of the blue ocean strategy is to break away from the contested market and come up with product and service offerings instead of benchmarking the competitors. When implemented without full deliberation, the blue ocean strategy stands a chance of misleading executives and entrepreneurs to overlook the importance of the relevant competition. Accordingly, a company may turn towards a blue ocean with a slim chance of success even though it has an ability to gain an advantage in competition by utilizing its own strengths, competitive edge, and higher technological prowess over rivals.