The-Theory-Of-Creative-Destruction-Is-Significant -163

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The theory of creative destruction is
significant in explaining the long term
endogenous economic growth
phenomenon. However, it falls short of
painting the complete picture. The theory of
reconstruction provides a compelling
explanation for endogenously created
economic growth that remains unexplained
by creative destruction. The two theories,
taken together, provide a more
comprehensive understanding of
determinants of long term economic growth.
blue ocean strategy framework

Creative destruction offers a partial explanation of endogenous
economic growth and changing industrial composition
Reconstruction however, driven by creativity as a learnable skill, is a
broader concept that can be identified in three subsidiaries, offering
explanation for the creative destruction's shortcomings to the
creation of the numerous new industries that resulted in the
reconstruction of boundaries between existing well-defined industries
and the economic growth generated through reconstruction of
boundaries within existing industries that generate new demand in
the market and creates new market spaces within industries First,
Schumpeter's creative destruction defined as an evolutionary
process in which companies follow the pattern of destruction and
rebirth, new structures completely destroy a previous market or
industry Ideas, skills, technologies, etc become obsolete as
innovations to an industry develop in the interest to improve
productivity or the standard of living A classic example is the death
of the type writer due to the development of the microprocessor
Second is the creation of an entirely new industry in which blue
oceans of uncontested market space are created due to the
reconstruction of boundaries between existing well-defined industries
For example, Cirque du Soleil created uncontested new market
space by appealing to a whole new group of customers By ignoring
the existing boundaries of the already shrinking circus industry and
theater Cirque du Soleil successfully reinvented the circus appealing
to a whole new group of consumers

Third is the expansion of a current market space or industry's
economic growth generated through the reconstruction of boundaries
within existing industries that generate new demand in the market
and creates new market spaces within industries Take Nintendo Wii
for example; * Every aspect of the Nintendo Wii is Fun Nintendo Wii
has been able to outsell Microsoft's Xbox 360 and Sony's
PS3 As the video gaming industry has become increasingly more
competitive Nintendo decided not to compete in the bloody red
ocean of competition Instead Nintendo applied Blue Ocean
Strategy's six-path element of Functional/Emotional to create
high profitable growth Nintendo eliminated movie playing, reduced
graphics and physics and raised the fun of playing video games
Nintendo realized that high-resolution movies on a game machine
are Technological Innovation: innovation solely for the sake of
innovating Fun, an emotion element, was placed over chips, a
functional element Whereas its competitors, Microsoft and Sony
concentrated entirely on functional elements: great graphics
processors, physics engines, specialized chips, etc

Nintendo didn't compete in the Red Ocean: they created a
Blue Ocean that rendered the competition irrelevant As stated
previously in this article Creative destruction completely wipes off
previous market/industry In contrast, reconstruction suggests new
industries new wealth and new markets can be generated
endogenously through companies' conscience efforts of
reconstruction of demand side value elements Buyer value elements
can be reordered across established market and industry boundaries
such that a new level of demand is generated spurring income
growth and creating wealth The central driver behind Blue Ocean
Strategy's reconstruction is creativity which is a learnable skill
Knowledge and ideas are systematically deployed in the process of
creation to identify and minimize risks as companies attempt to
maximize new market creation opportunities Brendan Murphy is the
Marketing Manager for Strategize Blue a Blue Ocean Strategy
Training and Consulting company based in San Diego He works
under Dr Zunaira Munir, the internationally acclaimed expert and

Blue Ocean Strategy Keynote Speaker

Strategize Blue Clients: Strategize Blue is powered by
internationally acclaimed Blue Ocean Strategy, Innovation
Management and Leadership Expert Dr Zunaira Munir As the
founder and Managing Director of international Blue Ocean Strategy
consulting firm Strategize Blue (San Diego, CA) she has helped
industry giants Intel, Coca Cola, Hewlett Packard, T-Mobile,
Honeywell, AUTODESK, Virbac, RJ Reynolds, DataPath and many
more to create wealth and sustainable growth A distinguished
business executive she helped lead her family-business Clary
Business Machines to one of the fastest growing privately held
companies in the US in 2008 and 2009 A sought-after speaker,
trainer, and business consultant she challenges companies to look
beyond just surviving Difficult to ignore the global impact of Blue
Ocean Strategy on the business and strategy world she vehemently
continues to inspire businesses to apply Blue Ocean Strategy She
asserts fighting with rivals over competition and innovation without
value is simply not enough Earning her doctorate in Innovation
Management from Wuhan University of Technology in China, over
six years of university teaching experience at the undergraduate and
graduate levels and global business credentials, Dr

Munir creates a lasting impact on organizations eager to innovate
and grow An active Senior Global Blue Ocean Strategy Network
Member she works directly under international best-selling Blue
Ocean Strategy authors W Chan Kim and Renee Mauborgne on
cutting-edge research, projects and initiatives worldwide Her
upcoming book "Key Concepts in Innovation" published by Palgrave
McMillan transforms the complexities of innovation into clear
terminology for both students and practitioners in the field Dr
Munir's widely published articles have been featured in China
Business Review, International Review of Business and Research,
the PDMA blue ocean strategy framework Research Forum and
many others For More Information: Mail: 10360 Sorrento Valley
Road, Suite C, San Diego CA 92121 Email:[email protected] com
Phone: +1(858)-324-1997 Fax: +1(858)-552-8609

blue ocean strategy framework