Blue Ocean

1. Companies who are operating blue ocean strategy means they are creating completely new industries, finding and developing markets where there is little or no competitors and usually have low cost due to new consumer value is developed.

Red ocean represents all existing industries today. Companies running red ocean strategy mean they are fighting over with other competitors to dividing up limited market. Under red ocean strategy companies copy other companies’ new technologies continually, though the costs keep rising.

2. In the article, author implied blue ocean strategy to creating new land and red ocean strategy to dividing up existing land, limited terrain and the need to beat an enemy to succeed. It also means denying the distinctive strength at the business world. The capacity to create new market space that is uncontested.

3. Key success factors

1) Leading-edge technology

Within the auto industry computer industry did not come about through technology innovations alone but y linking technology to what buyers valued. As with the IBM 650 and the Compaq pc server, this often involved simplifying the technology.

2) Incumbents.

Blue oceans made by incumbents were usually tithing their core businesses. GM and Chrysler were established players when they create blue oceans in the auto industry. Most blue oceans are created from within, not beyond, red oceans of existing industries.

3) Making the right strategic moves

Compaq for example is considered by many people to be “unsuccessful” because it was acquired by Hewlett Packard in 2001 and ceased to be a company, but the firm’s ultimate fate does not invalidate the smart strategic move and created multibillion dollar market in PC servers.

4. It means producer could raise customers’ demand of product by creating more new product combinations and innovations, services or entertainments. Demand could not be developed by fighting with other competitors. For example, in the article Cirque...