BLUE OCEAN STRATEGY

couraging for some of us. When business conditions become wicked, everyone can feel the heat. Even some of the biggest companies whose names and offices we admire are going through very challenging situations which have squeezed their margins. But there are some who are making good money. Sometimes the entire sector can go through challenging times. You do not necessarily have to continue fighting in the overcrowded space. You can make a decision and the decision lies in blue ocean strategy.

According to one of the definition carried by the Financial Times, blue ocean strategy generally refers to the creation by a company of a new, uncontested market space that makes competitors irrelevant and that creates new consumer value often while decreasing costs. It was introduced by W. Chan Kim and Renée Mauborgne in their best-selling book titled “Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant.”

In the market place, there are two oceans; the red ocean and the blue ocean.

The red ocean refers to the market segment where there is stiff competition. As the market space gets more crowded, prospects for profits and growth decline. Products turn into commodities and increasing competition turns the water bloody. This is red ocean. There are many sectors which are already red ocean. In some cases, it is almost impossible to penetrate.

In blue oceans, demand is created rather than fought for. There is a way in which you can create demand for your products or services. You can launch a complete new industry where you are the only one or you can create a product within the red ocean which no one has and thus expand the boundary. Creating blue oceans builds brands. So powerful is blue ocean strategy, in fact, that a blue ocean strategic move can create brand equity that lasts for decades. In many African countries including Zambia, we have a lot of opportunities for blue ocean initiatives. We want to see blue ocean strategic maneuvers in the energy sector.

In you look at the last 30 years, you will see a lot of companies or industries that have emerged which were not there before. Some of these companies launched products and services that never existed before. That is blue ocean strategy. We never had the DVD market for instance. We never had cell phones. There is a lot of things that we never had but we now have them because someone deployed a blue ocean strategy. Going by history, I can assure you that there is a lot that you and I have not yet seen in the market place.

Therefore, you can also launch your own blue ocean strategy. When the competition becomes too stiff, stand back and find ways of approaching the red ocean if you want to remain in the game. Alternative