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Business Practices for Sustaining Successful Organization

BusinessPractices for Sustaining Successful Organization

BusinessPractices for Sustaining Successful Organization

Thearrival of the 21stcentury has placed businesses in a rather complicated situation. Withthe advent of technology and innovation, many industries have emergedto serve customers. Consequently, there has been increased productionof complementary and supplementary products in the marketplace. Thepresence of these goods has resulted in intense competition, and thathas threatened the growth of many organizations. In other words,companies are confronted with excess supply, cutthroat rivalry, andreduced profit margins that only interfere with their expansionendeavors. Consequently, businesses must utilize the most appropriatestrategies, such as the Blue Ocean, to avert the situation and growinto the future as projected (Kim&amp Mauborgne, 2014).This paper provides an exposition on the reasons for organizationfailure, the practices that can be applied in a Blue Ocean strategy,and how the concepts of the Blue Ocean can aid in enhancing thesuccess of the otherwise challenged businesses of the 21stcentury.

WhyPresent Business Operations Fail to Sustain Organizational Success

Thecontemporary practices by the businesses can hardly aid the growthexpectations because, in many occasions, companies fail to reinforcethe three factors above in their strategies. First, it is critical tonote that an ideal organization operates on several departmentsincluding the manufacturing, accounting, marketing, and humanresource units. These departments, in their strategies of operation,have reported high levels of failure to recognize the correlationbetween the three driving forces of success (value of the buyer, thequest for profit, and the welfare of the workforce). For example, amarketing unit may stress on the buyer’s value and disregard theother two parameters. Similarly, the department that serves inmanufacturing may overwrite the consumer’s needs, or perceive theworkers as liabilities. Consequently, there have been repeated pulsesof business failure in the market (Sidiropoulos,2014).

Simplyput, businesses are failing to meet their growth projectionsregarding revenue and profitability because they do not have lucidexpansion strategies and potent execution infrastructures. Mostly,these institutions choose to invest in one of the two areasaforementioned (i.e. expansion strategy in the expense ofinfrastructure, or vice verse), and are oblivious of the fact thatone parameter, without the other, impairs the chances of success. Theprimary drivers to failure with respect to profitability and revenuegrowth are double-folded. First, organizations tend to show derisoryconsideration of the advantages that occur within the core business,the opportunities adjoining the core business, and the strengths thatprevail within the new consumer sub-segments. Second, mostorganizations lack the infrastructure that can accommodate thesuccessful exploitation of the above opportunity areas (Sidiropoulos,2014).With that situation persisting in the otherwise competitive businessatmosphere of the modern age, organizations will continue to reportmarket failures characterized by low profit generation, reducedcustomer base, and inadequate running capital. Fortunately, there areseveral strategies to help in the containment of the situation, oneof which is the Blue Ocean Strategy.

BlueOcean Strategy in Ensuring Organization Success

Theconcept of Blue Ocean was coined by Renee Mauborgne and Chan Kim.They realized that businesses concentrated more in one-on-one rivalryin the search of revenue expansion and profitability. In contrast,the modern-day’s overcrowded companies rivaling head-on culminatesin nothing short of severe “Red Ocean” characterized bycompetition over a dwindling pool of profit. It is posited thatpermanent success comes, not as a result of competitive conflicts,but from developing blue oceans of unexploited free marketplaces thatcan support business expansion. As a strategy, Blue Ocean operates oneight key principles that are decisive in enabling a business toexpand its revenue and profits in a market dominated by rivals(Chandrakala&amp Devaru, 2013).

Arguably,Kim&amp Mauborgne (2014) asserted that theconcepts of Blue Ocean are grounded on concrete data in which morethan 150 strategic approaches applied by at least 30 industries over100 years have been assessed for ten years. Consequently, Blue Oceanstrategy operates on the basis of concurrent pursuit ofdifferentiation and low cost. Contrary to the traditional belief thatcompanies can produce quality for clients at higher prices, ordevelop reasonable value at cheaper prices, Chandrakala&amp Devaru (2013) observed that theBlue Ocean strategy eliminates the tradeoff involving the commodityvalue and cost. That is possible through the minimization of factorswhich causes competition and the introduction of new factors that thebusiness has never operated, hence the concept of value innovation.The idea of value innovation, unlike competitive strategy, can guideorganizations to map what the clients value within the competitiveatmosphere, and that enables the creation of unique factors thatwould enhance differentiation and low cost, bringing about valuecontentment for both consumers and organizations.

Besides,Blue Ocean also facilitates the establishment of open market space asopposed to the conventional norm of head-on-head market competitionby companies. By remodeling the industrial boundaries, the strategyassists in nullifying the impacts of market rivalry (Kim&amp Mauborgne, 2014).Normally, businesses operate on comparable industry boundaries andfight to be the best. However, with the incorporation of BlueStrategy, they can avoid such boundaries and build new anduncontested avenues of new demand, thereby accruing tangible profits.Furthermore, blue ocean concept provides well defined tools andframeworks for avoiding rivalry and creation of spaces of open market(Kim&amp Mauborgne, 2014).Unlike the traditional approach in which businesses compete blatantlyin established markets, the strategy serves as an essential guide inthe development of tools, methodologies, and analytic frameworkswhich reinforce innovation and value, thereby reconstructing blueoceans of uncontested space in the market (Chandrakala&amp Devaru, 2013).Companies which apply these tools and frameworks are to self-sustainand succeed in terms of profitability and revenue generation.

Furthermore,Blue Ocean operates on clear step-by-step process of analyzing themarket environment, examining the new paths to the open markets, andhow to expand customer base (Kim&amp Mauborgne, 2014).These processes aim to eliminate the head-on competition and propelbusinesses towards maximum profit generation in the blue oceans.Therefore, companies are encouraged to invest less in the strategicplanning process, which has retained them in the competitiveenvironment and obstructed their success. Also, according to Kim&amp Mauborgne (2014) BlueOcean strategy endeavors to maximize opportunity while simultaneouslyminimize the potential risks through the utilization of the BlueOcean Idea Index. The index enables managers to find out if theirgoods will attract consumers at a certain price, and that thebusiness will accrue enough gains while keeping the customerscontented, and the challenges to expect plus their solutions(Chandrakala&amp Devaru, 2013).In other words, it takes consideration of the interests of thebuyers, the sellers, and the sustainability of business the currentorganizations require such an approach to increase their chances ofsucceeding in the current market, which presents challenges fromwithin (the value of organization) to without (buyer’s value) thebusiness setting.

Additionally,the design of Blue Ocean supports strategy formulation alongside itsexecution, something that most companies have failed to observe.Through the strategy, the employees’ minds and hearts are alignedto the new strategies through engagement, explanation, andexpectation clarity. That culminates in an environment of trust,commitment, motivation, and cooperation, which are key drivers everybusiness need to enhance quality production and market expansion(Chandrakala&amp Devaru, 2013).Finally, Blue Strategy works by aligning the three aspects of buyer’svalue, company profit, and people, and that ensures that the company,employees, and clients are satisfied. For any strategy to beeffective, a business must create an offering that capturesconsumers, a model that attracts profit for the industry, and anavenue that motivates the workers to execute the strategy (Kim&amp Mauborgne, 2014).

BusinessPractices Applicable in a Blue Ocean Strategy

Asevidenced in the Blue Ocean, the propositions of the three strategiesform the basis upon which businesses take holistic procedures tofacilitate strategy formulation and execution. Breuer(2013) argued that thethree strategies of buyer’s value, company profit, and people areconsistent with the organization’s traditional operation system. Asthe definitive output of a business’ actions are value for theconsumer and revenue for itself, while its inputs are represented bythe cost of production and the people to aid in the execution of theoperations, the three Blue Ocean strategies of buyer vale, profit(total revenue minus costs), and people reflect the core of what thecompany’s operation system accomplishes.

Consequently,the business practices of marketing, human resource management,manufacturing, staff training and development, employee motivation,and staff welfare are all practical areas of the Blue Ocean strategy.Product promotion and marketing enables a company to expand itsmarket into area with less competition, manufacturing generates theproducts of demand, training and development, staff welfare, andmotivation keeps the workforce satisfied and committed to executestrategies, and human resource management, through recruitment,performance appraisals, and trainings, ensures that the business hasthe expertise required to foresee innovation, quality, and profitgeneration (Breuer,2013).


Fromthe above considerations, it is pertinent to highlight that mostbusinesses fail because they utilize the concepts of head-oncompetition to gain competitive advantage in the market. However,with the introduction of Blue Ocean strategy, the approach highlyrecommended involves the nullification of the market rivalry byidentifying new, unexploited areas through value innovation.Consequently, the leading tenets of succeeding in the market is tosimultaneously observe buyer’s value, company’s quest for profit,and the employees’ job satisfaction none of the three valuesshould be disregarded in the expense of the other, or the businessrisks to fail in the short and long-terms.


Breuer,H. (2013). Lean venturing: Learning to create new business throughexploration, elaboration, evaluation, experimentation, andevolution.&nbspInternationalJournal of Innovation Management,&nbsp17(03),1340013.

Chandrakala,V. G., &amp Devaru, S. D. B. (2013). Blue Ocean Strategy and Bottomof the Pyramid Marketing.&nbspInternationalJournal of Management Research and Reviews,&nbsp3(7),3080.

Kim,W. C., &amp Mauborgne, R. (2014).&nbspBlueOcean Strategy, Expanded Edition: How to Create Uncontested MarketSpace and Make the Competition Irrelevant.Watertown, Massachusetts: Harvard Business Review Press.

Sidiropoulos,E. (2014). Education for sustainability in business educationprograms: a question of value.&nbspJournalof cleaner production,&nbsp85(16),472-487.