You now know how to assemble your hedgehog strategy it’s time to understand how you’ll be competing in the marketplace, or in our case the ocean.
The book Blue Ocean Strategy is based on the concept of not trying to compete in the market place but defining your own market space. The authors talk about business as defined as companies competing in the red ocean. It’s cut throat, battle to increase market-share, beat your competition and you’ll have a successful business. The alternative idea is shaking up the industry, doing something completely different, evolving business in some way. Adapting to the new needs of customers, having a deep understanding of how your business operates, and continually building a culture of bettering ones’ own efforts in strategy and execution. Ideas like these seem to be surfacing in many successful business models recently as a part of the strategy, slowly approaching the point where there is no competition, welcome to the blue ocean.
A quote from Blue Ocean Strategy:
“The only way to beat the competition is to stop trying to beat the competition. In red oceans, the industry boundaries are defined and accepted, and the competitive rules of the game are known. In blue oceans, competition is irrelevant because the rules of the game are waiting to be set. …The companies caught in the red ocean followed a conventional approach, racing to beat the competition by building a defensible position within the existing industry order. The creators of blue oceans, surprisingly, didn’t use the competition as their benchmark. …Instead of focusing on beating the competition, they focus on making the competition irrelevant by creating a leap in value for buyers and your company, thereby opening up new and uncontested market space. …Value innovation is based on the view that market boundaries and industry structure are not ‘given’ and can be reconstructed by the actions and beliefs of industry players. …To fundamentally shift the strategy canvas of an industry, you must begin by reorienting your strategic focus from competitors to alternatives, and from customers to non-customers of an industry. As you shift your strategic focus from current competition to alternatives and non-consumers, you gain insight into how to redefine the problem the industry focuses on and thereby reconstruct buyer value elements that reside across industry boundaries”
Well worth the purchase price, Blue Ocean Strategy is a fundamental book in understanding what business strategy will look like in the future.