Blue Ocean Strategy Principles at Work in the Marketplace
Last month I was asked to present to a group of investment fund managers. The topic was how to leverage social business marketing so I did a little digging and found that besides a large amount of social media spam and some ‘analogue’ multi-modality marketing there are as good as no companies in this space truly engaging in social business marketing.
I reflected on my experience in helping to develop Blue Ocean Strategy (BOS) for start-ups and businesses seeking rapid expansion, and decided that this presentation was another opportunity to apply the BOS principles. Blue Ocean Strategy became a popular concept through the publication of the book by the same name, and more so later when it went viral after a Harvard Business Review article. Once you steep yourself in the concepts of blue oceans, and clear your mind of traditional business clutter, you will start to identify more applications for BOS in every business and marketplace you come across. The big question is often whether the principles have the vision, courage and resolve to chart a course across the hitherto uncharted waters of their industry.
Good News, Bad News, Little Change
Despite a bias toward bad news, even mainstream media has to acknowledge on a daily basis that the status quo is generally improving around the world (at the time of writing this article). The major stock market indices are rising, the price of Gold is back up, and there is an air of confidence in the marketplace. With the exception of that last point, the rest is statistical irrefutable fact.
This trend however seems to have passed by (or been ignored by) large companies, especially in the financial services industry, who are hoarding cash on their balance sheets. Partial result, consumer credit remains difficult to access, which hurts people and by extension hurts the economy. When the financial services industry realises that excuses like Sarbanes-Oxley, and Basel II/Basel III simply don’t cut the mustard any more, a real turnaround will be able to happen.
The Blue Ocean Challenge
The principles in the Blue Ocean Strategy book challenge us to reassess how we conduct business, how we can create new value and innovation in what we do, and as a result to (re-)establish markets and offerings to reflect our new thinking. When you succeed you make your competition irrelevant, and for a little while at least you will enjoy a market in which you are unrivalled; at least until your traditional competitors play catch-up, or a new kid on the block decides he likes what you’ve done and wants a piece of the action.
Goods and services don’t necessarily need to be commoditised immediately, in some cases not at all. Excellence, value and innovation are collectively the key and with first mover advantage you will establish clear points of differentiation.
In the book ‘Blue Ocean Strategy’ one of the main examples is Cirque du Soleil and how they took the Circus Big Top experience and converted it into a theatrical piece that appealed to a much broader audience. Everyone I know who has ever experienced Cirque du Soleil is completely bowled over by the performance. Their success has recreated a buzz around the concept of circus for young and old alike and their bottom line is the proof that this was the right course to chart.
Redefining your market – some considerations!
There are many business strategy consultants around the world. You will probably have several hundred of them within a 100 km radius of your business. If you are more than just open to changing your approach to your industry, and are truly committed to and want to change then find those business strategy consultants who will challenge your traditional thinking and compliment you in the process of developing new value based innovative ideas that will free you from competition. Every industry has a blue ocean waiting to be discovered, in fact, there are probably hundreds, if not thousands, of industries that do not exist today, that have not yet been thought of, but which when conceived will create their own blue ocean, after which they will become mainstream. This will happen within the next 10 – 20 years.
Here are some basic principles I would like to share with you:
- Think value centric
- Build also on connected verticals, not just horizontally, that complement and expand your existing core capabilities.
- Identify strategic partnerships that will shorten your time to market and contribute to product excellence.
- Play where the money is. Help where the money isn’t. Financially lucrative markets are the bullpen and allow you to create playground that help others. Find the right market to transact in and even nominal success will deliver substantial revenue & profitability.
- When you have your strategy, ignore those who tell you no. Facts and statistics that these people will quote you were created by other people who once said I can.
- Fall fast and hard. Then stand up and learn. Rinse and repeat until learn is followed by earn. Simple physics really, being resilient will help you bounce back harder and higher. So be resilient, fall hard and fall fast and you will bounce back to stratospheric heights.
If you are serious about being more than above average, give serious thought and consideration to how you can redefine your industry and how you can use the principles of blue ocean strategy in your existing product or service offering.