• Title: Blue Ocean Strategy
• Authors: W. Chan Kim and Renée Mauborgne
• Publisher: Harvard Business School Press

The academic world is very prolific in terms of publishing new theories and analysis on business management. However, the results do not always respond to the expectations generated, and many hypotheses that are announced as revelations disappear just as quickly as they appeared. This is not the case with “Blue Ocean Strategy”, which has sold a million copies in only one year, and has become one of the biggest current phenomena.

The work contains a complete analysis of business strategy, for which its authors, the renowned professors from INSEAD in France, W. Chan Kim and Renée Mauborgne, have gathered information from 150 cases in about 30 industrial sectors throughout one century of history. The result was the development of a theory that posits a radical change in the way businesses deal with their role in the market.

From the red to the blue ocean

 
Through an exhaustive analysis, the authors establish the fact that there is a specific model that allows us to explain how to achieve a high level of growth that does not permit the market to answer; that is to say, a level of growth in which the competition plays a non-existent or irrelevant role. In order to do that, they establish a double metaphor: red oceans and blue oceans.

Competing in red oceans is a supreme effort: the competition is abundant, the market does not give more of itself, and it can only fight for the customers that make up the current demand. In general, achieving positive results requires expensive investments, and interest rates are usually low. On the opposite side we find blue oceans, new scenarios in which the first company to enter has a wide margin for growth, the competition is irrelevant, and it is possible to create a higher value for customers with lower costs.

Chan Kim and Maubourgne’s book analyzes cases as significant as that of Ford, Cirque du Soleil, Apple’s iPod, and the American gym chain Curves, and it offers the necessary clues to properly focus strategic planning.