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In: Operations Management

 Explain the characteristics and fundamental differences of ‘Blue Ocean and Red Ocean’ strategies (Kim & Mauborgne,...

 Explain the characteristics and fundamental differences of ‘Blue Ocean and Red Ocean’ strategies (Kim & Mauborgne, 2005). Please elaborate more.

Solutions

Expert Solution

Explain the characteristics and fundamental differences of ‘Blue Ocean and Red Ocean’ strategies

  • Red oceans are all the industries in existence today, where industry boundaries are defined and companies try to outperform their rivals for a greater share of the existing market. Cutthroat competition turns the ocean bloody red
  • Blue oceans denote all the industries not in existence today which is unexplored by competition. Like the ‘blue’ ocean, in terms of opportunity and profitable growth
  • Red Ocean’ strategies compete in existing market space., whereas Blue Ocean strategies create new market space.
  • Red Ocean’ strategies exploit existing demand, whereas Blue Ocean strategies create new demand
  • Red Ocean’ strategies Make the value-cost trade-off, whereas Blue Ocean strategies break the value cost trade-off
  • Red Ocean’ strategies have to focus on beating competition all the time, whereas Blue Ocean strategies enjoy absence of competition

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