In red oceans industry boundaries are defined and

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Unformatted text preview: gher level of demand is generated. Red Oceans refer to the known market space, i.e. all the industries in existence today. In red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. Companies try to outperform their rivals to grab a greater share of existing demand usually through marginal changes in offering level and price. As the market space gets crowded, prospects for profits and growth are reduced. Products become commodities, and cutthroat competition turns the red ocean bloody. Resource Hurdles are the difficulties managers face implementing change with limited resources and time. Traditionally it is believed that the greater the shift in strategy, the greater the resources needed to execute it. Unfortunately, a company rarely has the resources it thinks it needs to achieve a sharp shift in strategy as is often required with Blue Ocean Strategy. Leaders that practice tipping point leadership, however, do not spend their time and energy obtaining more resources. Instead, they identify where the cold spots (activities that have high resource input but low performance impact) and hot spots (activities that have low resource input but high pote...
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