Review: This business standard is worth rereading particularly as the nature of competition continues to evolve. The seminal writings of Michael Porter (author of “What is Strategy?” an excellent HBR article) provide the framework of traditional strategic thinking. These authors attempt to take things one step further and create another way to look at strategic thinking. The title refers to their metaphor—red oceans are places where companies compete in traditional ways, taking incremental market share from each other by making minor product advancements while blue oceans are new areas of opportunities with few, if any, competitors.
The examples used to illustrate the authors’ thinking will be familiar to you and it’s interesting in hindsight to see how each of these companies was able to free itself from industry constraints. For instance, Dell decided to customize each computer to the individual consumer—completely opposite of what other manufacturers were doing at the time. This created new value for customers and added the experience of creating their new computer to the process of buying a computer. This type of “value innovation” eg examining the entirety of a company’s activities and identifying a way to create a jump in value for both customers and the company itself is the core of this book.
This is an important foundational work for any well-read executive.