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Blue oceans

Sobre el autor

Francisco Reina es Director Gerente de rb Ingenieros Consultores, S.L [1].

Most companies are immersed in a constant fight for success, for out-pacing their competitors, for getting a higher market share, and for selling more.

Surviving is becoming more and more difficult, since nowadays we must compete in a global market which is crowded with companies and products very similar to those we are selling. With this behaviour, companies are dependant on the value/cost tradeoff in their fight against their competitors.

These markets are what W. Chan Kim and RenĂ©e Mauborgne [INSEAD professors] have called “red oceans”, stained with the blood from the war fought for the same market space by thousands of companies.

However, there are some companies which have escaped from those “red oceans” and they are swimming in a different type of oceans where competition is irrelevant, where they have created a new demand which did not exist before, where the value/cost trade-off is not significant anymore, and where the company as a whole is rowing in the same direction to pursuit a target strategy based on differentiation and low cost. These are the so-called “blue oceans”.

But what can we do to swim in a blue ocean? We must be able to look further, beyond our company and even our market and industry. We must look for new customers, create a new demand. That is what companies such as Swatch, Dell, Le Cirque du Soleil, IKEA, and some other enlightened companies have done – they have found out the way to expand the boundaries of some traditional and sometimes unattractive industries.

That is why it is becoming more and more necessary for companies to set up long-term strategies which allow them to lay out the foundations to create their own blue ocean, and not to live from one day to the next, improvising as they go alonge tone t foundations to create their own bu unatrant, where they have created a new demand with.

We as entrepreneurs are all searching our little blue ocean where to be able to develop and grow before sharks arrive and turn it red.

And what about you? Already swimming in your own blue ocean?