Blue Oceans

[Clymer/JR]

Wow. Who would have thought that Apple would dethrone Microsoft in the category of market capitalization. They did just that! For Apple 'followers', who have always seen Microsoft through some Manichean prism, this event takes on religious proportions. For the rest of us Apple admirers (who don't rely on anti-psychotic meds to get through the day), however, this is noteworthy for what it reveals about how to succeed, "not simply compete". Read this interesting analysis from Network World.

A few days ago, we added Blue Ocean Strategy by Kim & Mauborgne to our MedTech IQ recommended reading list. Utilizing the authors' framework, it readily becomes apparent that Microsoft pursued a conventional "Red Ocean" strategy; Apple chose a different path. Peter Leerskov summarizes the "Blue Ocean Strategy" well:

• DO NOT compete in an existing market space. INSTEAD, create an uncontested market space.

• DO NOT beat the competition. INSTEAD, make the competition irrelevant.

• DO NOT exploit existing demand. INSTEAD, create and capture new demand.

• DO NOT make the value/cost trade-off. INSTEAD, break the value/cost trade-off.

• DO NOT align the whole system of a company's activities with a strategic choice of differentiation vs low cost. INSTEAD, align the whole system in pursuit of both differentiation and low cost.

It is no coincidence that Conrad Clyburn added this work to our must read list. In our consulting practice, The Clymer Group has, for many years, enthusiastically advocated for these principles. Rather than competing for "best of breed", we have argued for "defining the breed", a sui-generis approach which is organic to the Blue Ocean Strategy. Apple may be the most luminous illustration, but the sign posts are there for all to see!!!