Strategic Thinking and the Blue Ocean Approach in Business

In an increasingly competitive economic world, companies seek to stand out and create unique value for their customers. Strategic thinking is essential to anticipate trends, innovate and ensure sustainable growth. One of the most influential concepts in this field is that of the Blue Ocean, introduced by W. Chan Kim and Renée Mauborgne in their book Blue Ocean Strategy. This approach proposes to move away from traditional competition to explore new markets with high potential.

Understanding the Blue Ocean Approach

The Blue Ocean approach is based on a simple idea: instead of fighting for market share in a saturated sector (Red Ocean), a company should seek to create an entirely new market space where competition is low or non-existent.

Red Oceans represent traditional industries where companies compete on the same bases: price, quality, functionality… This environment fosters fierce competition that reduces margins and limits growth.

Blue Oceans, on the other hand, are unexplored markets, where a company can offer a new value proposition to customers, moving away from the classic rules of the game.

The Principles of the Blue Ocean Approach

1. Create New Demand: Instead of appealing to the same customers as competitors, it's about targeting an audience that's still untapped.

2. Breaking Out of Sector Conformism: Questioning established norms and redefining the offer to respond differently to consumer needs.

3. Reduce Costs and Deliver Superior Value: By eliminating unnecessary elements and innovating on key factors, a company can offer a unique product or service at a competitive cost.

Blue Ocean Approach Tools

• The Elimination-Reduction-Augmentation-Creation (ERAC) Matrix:
  This tool helps analyze elements of a market to identify those that can be removed or reduced, and those that can be improved or created.

• The Value Curve:
  It helps visualize how a company positions itself relative to its competitors and where it can differentiate itself.

• The Strategic Canvas:
  It is used to map the competitive landscape and identify opportunities for innovation.

Blue Ocean Success Stories

• Cirque du Soleil: By reinventing the traditional circus into a high-end artistic spectacle, the brand attracted a new audience and eliminated the costs associated with animals and classic acts.

• Nintendo Wii: Instead of competing with Sony and Microsoft's ultra-powerful consoles, Nintendo created a new gaming experience based on accessibility and movement.

The Blue Ocean approach is a powerful lever for companies looking to differentiate and innovate. By challenging market norms and exploring new opportunities, a company can create sustainable growth while avoiding the fierce competition of Red Oceans.