Name :

Asghar Ali

Roll no:

MSBA-F19-06o

Semester:

01

Assignment:

Implementation blue and red ocean strategy

Blue ocean strategy:
Blue ocean, in contrast, denote all the industries not in existence today, the unknown
market space, untainted by competitor. In blue ocean, demand is created rather than fought over.
There is ample opportunity for growth that is both profitable and rapid. In blue ocean,
competition is irrelevant because the rules of games are waiting to be set. Blue ocean is an
analog to describe the wider, deeper potential of market space that is not yet explored.

Examples :
According to KIM and MAUBORGNE the examples of blue ocean strategy:

 Cirque du Soleil: Blending of opera and ballet with circus format while eliminating star
performer and animals.
 Netjets: fractional jet ownership.
 Southwest Airlines: offering flexibility of bus travel at the speed of air travel using
secondary airport;
 Curves: redefining market boundaries between health club and home exercise program for
women.

Red ocean strategy:

A red ocean is the strategy which aim to fight and beat the competition. Red ocean represent
all the industries in existences today. The known market space. In the red ocean, industry
boundaries are defined and accepted, and the competitive rules of the game are known. Here
companies try to outperform their rivals to grab a greater share of product or services demand.
As the market space gets crowded, prospect for profit and growth are reduced. Products become
commodities or niche and cutthroat competition turns the ocean bloody, hence the term red
oceans.

Examples:
A good example of red ocean strategy is the European air line operator Ryanair or southwest if
you like in the US. They are competing very successfully in the already saturated red ocean of
the short haul airline business. Their strategy is focused on providing a low cost no frills airline.
How we implement the blue ocean strategy?
 Get started:
 Select the right scope for your blue ocean initiative and build your people’s confidence:

Begin by working out which business, product or service you are going to tackle. To help
you do this, we introduce the pioneer-migrator-settler map. This will help you target the area
where you have the most to gain. We then show you how to put together the right team that
is going to carry out the blue ocean initiative, and how to build their confidence for more
effective buy-in.

 Understand where you are now:

 Next get super clear about the current state play:
Next you need to ask yourself the following question: do I have one simple picture that
everyone can understand and put everyone have same page? Having a clear and shared
picture of the current strategic landscape is critical. We provide you with a tool that shows
the current strategic landscape in one simple picture. It reveals how similar yours and your
competition strategic look to buyers and customer and why this is driving your industry
toward the red ocean.
 Imagine where you could be:
 Identify the hidden constraints that you opportunities:
Once you see the big picture, it’s time for you to imagine where you could be. The challenge
is to develop an equally clear, big picture view of how the assumptions and boundaries of
your industry also limit its appeal and size by causing pain points. We show you how to use
the buyer utility map to discover what these pain point are. These pain point are not
constraints; they are hidden opportunities to break away from the competition and provide
new solutions to existing problems. This brings you to the next task: understanding precisely
who your noncustomers are and why they tend to stay away from your industry. To achieve
this, we introduce the three tiers of noncustomers. This analytic framework helps
organization broaden their vision and convert latent demand into real demand in the form of
new customers.
 Find how to get there
 Go from the big picture to creating practical blue ocean options:
Now your team is ready to generate practical blue ocean options that pursue both
differentiation and low cost. This mean applying systematic process to reconstruct market
boundaries and create new market space. To help you do this we show you how to use the
six paths framework. This tool will help you see opportunities where others see only red
ocean of competitor. To make sense of these insight and formulate them into strategy, we
introduce the four team on what they can eliminate reduce raise and create and construct six
potentially viable blue ocean strategic moves.
 Make your move:
 Launch your blue ocean moves
The fifth and final step is where you’ll learn how to select your blue ocean move rapidly test
it in the market, and refine it to maximize its potential we show you how to choose which
blue ocean move to pursue by hosting a blue ocean fair. The fair is designed to take the
politics out of the decision-making process, get feedback, and consolidate people’s
commitment to their chosen move. Now you’re ready to launch your blue ocean strategy
move.

How to implement red ocean strategy?

 Compete in existing market:

They focus on competing in the marketplace which already exists.
 Beat competition:
They focus on beating the completion.
 Make the value/cost trade-off:
They focus on the value/cost trade-off. The value/cost trade-off is the view
that a company has the choice between creating more value for customers but at a higher
cost, or responsible value for customers at a lower cost. In constrast, those who attempt a
blue ocean strategy aim to achieve differentiation and at the same time, low cost.
 Capture more of existing demand:
They focus on exploiting existing demand.
 They focus on execution better marketing, lower cost base etc.