“Blue Ocean” Strategy: Corporate-speak or the wave of the future?

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Around the office, we always have a laugh poking fun at clichéd corporate-speak. Utter the phrases “new paradigm,” “think outside the box,” “value added” or “synergy” around here and you’ll get either a rolling of the eyes or a stapler thrown at you.

I don’t know if “Blue Ocean Strategy” is really going to catch on in the corporate world or if it will just become one of those overused phrases that people say glibly in sales pitches and seminars, but at the risk of office supplies being hurled at me, I do think the concept makes a lot of sense and has great possibilities, especially in recruiting.

The concept of Blue Ocean Strategy (or BOS) was developed by W. Chan Kim and Renée Mauborgne, and is a result of a decade-long study spanning more than 30 industries over 100 years (1880-2000). Here’s the idea: most organizations battle competitors in a bloody “Red Ocean.” In that Red Ocean, we occupy the same space and vigorously compete on things like price, service, image—all while trying to differentiate ourselves from our competitors—when it reality we’re very similar (think of McDonald’s, Burger King and Wendy’s).

What Kim and Mauborge claim is that the way to succeed is not through the wasteful, exhausting fighting of our competitors but by “creating Blue Oceans of uncontested market space ripe for growth. Such strategic moves—termed “value innovation”—create powerful leaps in value for both the firm and its buyers, rendering rivals obsolete and unleashing new demand.”

The headline on their website is, “Don’t compete with rivals, make them irrelevant.”  Apple and Google would be obvious examples of BOS organizations, and this graphic does a good job of showing the difference between Red Oceans and Blue Oceans:

Does this have implications for recruiting? Absolutely. I encourage you to read Jason Warner’s ERE article on ways HR Departments can make 2011 the year of Blue Ocean recruiting. One of the things Jason recommends is something Alstin has been helping clients with for decades: finding and attracting candidates using nontraditional methods. To quote his example:

XOX Software is competing for software developers, just like every other technology company. Traditional strategy would suggest that it go head to head with Google and Amazon and Microsoft and all of the others, posting jobs on Dice.com and showing Facebook ads to people who work at those places, trying to entice them away. In other words, traditional recruitment competes in the same spaces for the same talent, applying traditional recruitment practices but trying to do them faster, more effectively, more broadly in order to get the talent that it needs.

Obviously, that’s the Red Ocean strategy. The Blue Ocean way would be to generate and reach those candidates in a nontraditional way. But BOS goes further than that. It demands that you look at all the parts of your recruiting system (while recognizing that they are probably very similar to your competitors), and analyze the benefits and costs of each. In this case, XOX Software realized that one that area that needed to be improved well beyond the industry standard was recruitment cycle time. Once achieved, XOX found it wasn’t even competing anymore because it was closing on the candidates it wanted before the competition could even decide they wanted to pursue the candidate.

Again, I imagine some people will start throwing the term Blue Ocean Strategy about as corporate-speak, but I think there’s lots of benefits, and I recommend visiting the Blue Ocean Strategy website and learning more.

I’d love to hear from anyone else who is trying BOS at their organization who wants to share their story.

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About Tony Rosato

Tony Rosato, Alstin's Vice President, Client Development, is the most well-traveled member of our team and one of the nicest guys we know. Sharing his 20 years of industry experience with prospective clients everywhere, Tony's Type A personality is powered by premium iced tea (but never chocolate).