1. Rob Gleasure R.Gleasure@ucc.ie www.robgleasure.com
IS3320 Developing and Using Management Information Systems Lecture 4: Blue Ocean Thinking in the development and use of MIS
Rob Gleasure

2. IS3320
Today’s lecture
Blue Ocean Thinking
Exercise

3. IS3320 Schedule Week 1: introduction
Week 2: trends in IT-based markets
Week 3: blue ocean thinking
Week 4: design thinking
Week 5: introducing innovations
Week 6: use cases and scenarios
Week 7-8: flow charts/business process modelling
Week 9: data-flow diagrams
Week 10: project management
Week 11: usability, user experience and testing
Week 12: revision
Strategy
May swap…
Implementation

4. What is Strategy? What’s the difference between strategy and tactics?
Strategy means competition?
Image from

5. 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)

6. 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 &

7. 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

8. 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?

9. What is Blue Ocean Strategy?
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10. Example of a Blue Ocean Value Curve for Yellow Tail
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11. Example of a Blue Ocean Value Curve for The Nintendo Wii
From

12. Example of a Blue Ocean Strategy in Other Contexts
We’re all rational people, right?
Explain this…
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13. 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
What functionalities are made possible by new IT capabilities?
Do people want this enough to justify changing their behaviour?

14. 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?

15. Want to read more? Links and references
Kim, W.C., Mauborgne, R Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant. Harvard Business Press, Cambridge MA.
Porter, M.E Competitive Strategy, Free Press, NY, 1980.
Porter, M.E. (2008) The Five Competitive Forces That Shape Strategy, Harvard business Review, January 2008.