By Bill Ballas, CFRE
To help enrich your career, I’d like you to consider crafting a “blue ocean strategy” for your company. You are about to read a mini-case study about Cirque du Soleil’s rise to prominence and profitability. The lessons are timeless for those working for profit-driven businesses or 501(c)(3)s – whether they be large, small or in between.
The first time I attended a Cirque du Soleil performance was in 1988. I was impressed by the show’s creativity and the performers’ jaw dropping strength and grace. As a newly minted marketing manager, I wondered how Cirque became so popular so fast.
The answer to my question is richly explained in the best-selling book, Blue Ocean Strategy, written by INSEAD professors W. Chan Kim and Renee’ Mauborgne. The tome is based on their decade-long study of 150 strategic moves spanning more than 30 industries over 100 years. (And if people don’t believe in evidence, what do they believe in?)
Kim and Maurbogne note the difference between a blue and red ocean is that red oceans roil with the blood of company’s vying for the same market share and profits. This creates markets and profits to predictably shrink. (As we’ll see later, this applies to 501(c)(3)s, as well.)
Cirque was founded by a group of street performers whose “blue ocean strategy” was to avoid competing with circuses and theatres. They became who they are by fashioning a new marketspace that attracted audiences who did not attend the circus or theatre, and by gaining many circus and theatre patrons.
Kim and Mauborgne found that companies swimming in a red ocean are in a “race to the bottom.” This is because senior managers “are often afraid to try new things because it requires them to go outside their comfort zone. Senior managers then engage in ‘self-justification’ that often stunts company growth.”
Deep thinking and strategy formulation are essential for businesses and 501(c)(3)s.
According to “Public Goods” and “Contract Failure” theory, 501(c)(3)s originated to meet a need that (1) businesses can’t or won’t satisfy, or (2) which consumers -- and donors -- don’t believe commercial enterprises should fulfill. Yet many services that were once the province of 501(c)(3)s are today being provided by for-profits. Hospitals, diagnostic centers, nursing homes and hospices are examples of how blue oceans have turned red.
Competition is real. For everyone.
If you are interested in finding your organization’s blue ocean, here are two recommendations. First, take part in a blue ocean strategy (BOSS) training. It will help you create a systematic process to drive innovation and to integrate innovative thinking into the business planning process. BOSS provides the structure for creative thinking so leaders gain the tools to identify and sustain company growth. Companies like Nintendo and Samsung have already fully embraced our process. (Participant surveys tell us the trainings were a lot of fun, too.)
In addition, our strategic marketing practice assists you in identifying hidden markets and value propositions. Using primary and secondary research techniques, as well as predictive analytics, we help decision-makers improve their strategic perspective and position their organization for continuous growth.
When you take advantage of a BOSS training or strategic marketing consult individually or together, the result is that you will be better able to find your path to continuous growth.
For more information about our simulations and clients, click "Leadership Development" on the menu bar. Strategic marketing clients and services can be found by clicking "Clients" on the menu bar. Or simply contact Bill Ballas at firstname.lastname@example.org or 925.989.4276.