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The blue ocean of innovation

What do Blockbuster, Kodak and Polaroid have to do with Starbucks, Apple and Cirque du Soleil? Some of these companies have overcome difficulties and crises, rethinking their products, processes, and industrial organization, as well as turning the obstacles into opportunities, and adapting to sudden changes in the market.

Digitalization is the fourth revolution. The ethical management of innovation is one of the focal points at the center of the debate on artificial intelligence, Industry 4.0, and interaction with human beings. Innovation is born from the will to change. It needs connections, contamination, debate and collaboration. And it comes if we’re ready for it.

Blockbuster and Kodak lost their game by being resistant to change. We can therefore only wonder how would their story end like if they had supported the technological and digital revolution. Back home in Italy, we had always had a reference for an "Adaptive Business Model" in Ivrea, in the province of Turin: his name was Adriano Olivetti, a "revolutionary entrepreneur" by profession. A man capable of creating a new factory experience, unique in the world.

Returning to the international scene, "Blue Ocean Strategy" is a useful book that explores the model that has revolutionized the business world. The best-seller, written by two INSEAD professors - W. Chan Kim, consultant for the European Union and management guru, and Renée Mauborgne, member of the World Economic Forum - has inspired and reassured over three and a half million readers.

The authors use a metaphor referring to the blood of a battle for survival (red), and the endless opportunities that organizations can create (blue): managers and entrepreneurs from all over the world have experimented with a method to get out of the red ocean of competition and navigate in a blue ocean of new markets, increasing demand, and solid growth.

These are three recurrent mistakes that "non-adaptive" companies make by not addressing the issue of innovation.
 

Companies trapped within the boundaries of their industry

The structure and boundaries of a market are not fixed elements: they can be redefined by the actions and beliefs of those who operate in them, thanks to the power of imagination.


Companies trapped within the boundaries of competition

Too many companies let competition decide their strategy. Focusing on innovation will push them to downsize price policies, and seek new quality factors, creating new markets.
 

Innovation and creativity are not a black box

Schumpeter saw innovation as a sort of mysterious box, driven mostly by chance. The creators of the Blue Ocean strategy on the other hand, demonstrate how strategic creativity can be unleashed in a controlled way, thanks to collaboration.