IS3320 Developing and Using
Management Information Systems
Lecture 5: Blue Ocean Thinking in the
development and use of MIS
Rob Gleasure
R.Gleasure@ucc.ie
www.robgleasure.com
IS3320

Today’s lecture
 Blue Ocean Thinking
 Exercise
What is Strategy?

What’s the difference between strategy and tactics?

Strategy means competition?
Image from http://www.equinoxap.com/services/strategy/
Blue Ocean Strategy



Last week we spoke about developing and using MIS to pre-empt
and exploit technological evolution in markets
When a market becomes ‘pure competition’ (price-based), it may not
be appealing for new entrants
When this is the case, we may need to introduce some new factors
to effectively create a new market
 This has been described as adopting a Blue Ocean Strategy (Kim
& Mauborgne 2008)
Red Ocean vs. Blue Ocean
Red Ocean Strategy
Blue Ocean Strategy
Compete in existing market space
Create uncontested market space
Beat the competition
Make the competition irrelevant
Exploit existing demand
Create and capture new demand
Make the value‐cost trade‐off
Break the value‐cost trade‐off
Align the whole system of a
company’s activities with its strategic
choice of differentiation or low cost
Align the whole system of a
company’s activities in pursuit of
differentiation and low cost
From Kim & Mauborgne @ http://www.blueoceanstrategy.com/downloads/bos_web.pdf
What is Blue Ocean Strategy?


'The supreme art of war is to subdue the enemy without fighting‘
(Sun Tzu)*
The basic idea is very simple
 We list out each competitive factor in our industry
 We gauge each of these ideas according to customer needs and
the capacity of existing competitors to meet those needs
 Then we ask ourselves four questions…
*With apologies for Sun Tzu quote cliché
What is Blue Ocean Strategy?

What competitive factors can we reduce?

What competitive factors can we eliminate?

What competitive factors can we raise?

What competitive factors can we create?
What is Blue Ocean Strategy?
From http://www.blueoceanstrategy.com/about/concepts/4-actions-framework/
Example of a Blue Ocean Value Curve
for Yellow Tail
From http://www.blueoceanstrategy.com/downloads/bos_web.pdf/
Example of a Blue Ocean Value Curve
for The Nintendo Wii
From http://www.slideshare.net/ymike27/blue-ocean-strategy-3626410
Example of a Blue Ocean Strategy in
Other Contexts

We’re all rational people, right?

Explain this…
From http://www.everywhereist.com/the-donald-trump-republican-presidential-debate-drinking-game/
Adopting a Blue Ocean Strategy for an
eBusiness

We can view this as resetting the market lifecycle described by
Christensen
 We’re looking for new functionalities

Instead of asking if IT capabilities can improve upon a key
dimension for competition, we ask
1.
What functionalities are made possible by new IT capabilities?
2.
Do people want this enough to justify changing their behaviour?
Exercise

Blockbuster have decided they’ve had enough! They want to
instigate a complete re-think of their IT capabilities and the home
entertainments market to try and find a new value proposition

What competitive factors in that market should they reduce?

What competitive factors in that market should they eliminate?

What competitive factors in that market should they raise?

What competitive factors in that market should they create?
Want to read more?

Links and references
 http://books.google.ie/books?id=SZQnfdM9O7wC&printsec=front
cover&source=gbs_ge_summary_r&cad=0#v=onepage&q&f=fals
e
 Kim, W.C., Mauborgne, R. 2005. Blue Ocean Strategy: How to
Create Uncontested Market Space and Make Competition
Irrelevant. Harvard Business Press, Cambridge MA.
 Porter, M.E. 1980. Competitive Strategy, Free Press, NY, 1980.
 Porter, M.E. (2008) The Five Competitive Forces That Shape
Strategy, Harvard business Review, January 2008.