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Blue Ocean Strategy or Hardball: Thinking about Competition

Tuesday, April 5, 2005 at 09:44PM
Posted by Registered CommenterPolitical Mammal in Entrepreneurship

Most books on business have one main idea that can be absorbed pretty quickly. I have just scanned through two books on business competition and they both fit that characterization: Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant and Hardball : Are You Playing to Play or Playing to Win. I reacted very positively to the first, and pretty negatively to the second.

In the first book, the authors use the metaphor of a red ocean to describe a mature market where companies fight for market share and a blue ocean to describe new or redefined market space where companies, for a time, innovate and navigate without competition. The signature example they put forward is Cirque de Soleil, which took the idea of a circus--a declining business--and created from it a new and profitable entertainment niche. I found that example and the notion of seeking blue oceans very appealing.

In the second book, the authors call for business to be fought like a war: they suggest that competitors can build or maintain an edge by unleashing massive and overwhelming force, exploiting anomalies, devastating profit sanctuaries, raising competitors' costs, and breaking compromises. They argue that pursuing business in this fashion is a duty and produces results that are best for companies—and for society. I saw some sense to elements of their argument, but it put me off and made me less interested in participating in a business run in that fashion.

I guess these reactions say something about me. What I hope they say is not that I dislike competition, because I am a pretty competitive fellow, but that I am more interested in the long term in doing something new and valuable with my company than tangling over money with other companies that do substantially similar work.

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