Blue Ocean or Blue Sky? It's still the blues...

Recently I read "Blue Ocean Strategy," a purported solution to the age-old question of "how do I make a buck in this world?" The subtitle, "How to Create Uncontested Market Space and Make the Competition Irrelevant," promises the holy grail of psuedo-monopoly, giddy profits, and a captive customer base, so I was hooked. Tell me more...

Written by W. Chan Kim and Renee Mauborgne, the book was published by Harvard Business School press - a surefire ticket to management-consultant riches, and they do not disappoint from that perspective. Blue ocean strategy divides capitalism into two bodies of water, red oceans and blue oceans. The red oceans are where competition swims like a great white just offshore during the Fourth of July festival at Amity Island. On the other hand, blue oceans are devoid of life except your own private party; they are like a giant spa filled with dancers whose names are Bambi, Jade, and Sapphire, and ringed by bottles of Cristal. You just settle in to the warm, bubbling water and listen to the giggles while smearing some Ossetra on a piece of gold leaf. Apparently, many well-known innovations are the result of blue ocean strategy, even though the book was written decades after those goods and services came to market.

One of the strokes of genius discussed thoroughly in BOS is Cirque du Soleil, the entertainment brainchild of Guy Laliberte and Daniel Gauthier. These men came from the rough-and-tumble world of street performance art, and the "Circus of the Sun" was originally intended to run for 13 weeks in Quebec and then shut down. But according to BOS, it was Guy's plan to devise a circus that was different from Barnum and Baily or Ringling Bros.; in fact, Blue Ocean Strategy only shows the traditional American circus acts as the sole competitive landscape for Cirque du Soleil. It's almost as if Guy and Daniel were planning to deal with the prospect of setting up their tent in the same town at the same time as a conventional three-ringed event, an eventuality that never occurred.

Apparently, Lalibert and Gauthier used a "strategy canvas" in 1984 to determine the precise differentiation factors from elephants and lion tamers and to create a blue ocean experience. Never mind that they were street performers who wanted to bring street performance to a theater. Never mind that the strategy canvas wasn't invented until 2005, or that the Canadian government bailed them out when they went bankrupt, or that they hired Guy Caron in 1985 to incorporate elements from circuses around the world into their show. Those pesky facts would interfere with the premise that BOS is not a POS.

Another blue-ocean innovator is Herb Kelleher, the founder of Southwest Airlines. It seems that he and Rollin King used a strategy canvas in 1970 to define the role of Southwest in a soon-to-be deregulated air travel market. Apparently, he carefully plotted the points in the Eliminate-Reduce-Raise-Create grid and after careful implementation of the BOS, he started the most successful airline in U.S. history. Yet, if the authors had actually asked Kelleher about his reasoning, he would have told them that if you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline. He would have told them that he never used a blue ocean strategy; he just wanted to deliver a reliable, fun service to an under-served market - a traditional marketing strategy that wouldn't make a dime for a management consultant.

Blue Ocean Strategy tells us to avoid red oceans at all costs; the red ocean is hard work followed by a slow death. Yet, red oceans are the source of all incremental innovation. Red oceans are the reason we have iPhones & iPods, air conditioning, disc brakes, power steering, touch-tone telephones, ball point pens, sliced bread, frozen vegetables - this list could go on for miles and encompass millions of products and services that make the modern world more comfortable, safe, and enjoyable. This is not to discount the disruptive innovations that crawl out of blue oceans onto muddy shores, but at the same time, to recognize that blue oceans also spawn far more failures than red oceans. Remember the old adage, you can tell a pioneer because he's face down in the dirt and has arrows in his back.

Hindsight is 20/20, and I could find allegory in a phone book. What this means is that after examining successful products, anyone could devise a "strategy" that creates a common thread out of thin air, complete with charts and graphs that can be sold to desperate businesspeople seeking salvation in the global economy. But the reality of the matter is that innovation begins with someone wanting to deliver an outstanding customer experience, and each innovator is as different as a snowflake. There are no magic juju beans or secret sauces, just a desire to delight, amaze, or enthrall.

The true test of BOS is, since it was published, can the authors point to a single disruptive innovation that was created solely as the result of someone reading their book? Take your time, I've got all day...

Blue Ocean Strategy delivers a value not found on the bookstore shelves in the "Business" section or in an MBA program. Its appraisal is more akin to Moby Dick, a big fish story. As a work of fiction, it is priceless.