Why the 'red ocean' keeps getting more expensive
When all competitors compete by the same factors — price, assortment, speed — the market becomes a 'red ocean': share is won from the neighbour, the margin melts, and every step of a competitor has to be repeated. Kim and Mauborgne in the book "Blue Ocean Strategy" showed the alternative: instead of fighting for existing share, create open space where competition simply does not work, because the set of value factors is different.
Step 1: list the factors of competition
The first five minutes — the list of factors by which the market currently competes: price, speed, volume, quality, service, channels. This is the horizontal axis of the future value curve. The list must be about a concrete product or service, not about the industry in general: the more precise the factors, the more useful the grid.
Step 2: fill in the ERRC grid
The next ten minutes — four questions for each factor and beyond it. Eliminate: what does the market consider mandatory that can be removed entirely? Reduce: what can be lowered below the industry level, because customers overrate it? Raise: what to lift above the industry level, because it is underrated? Create: what is missing from the market but could become a new value factor? The classic example is Cirque du Soleil: it eliminated stars and animals, reduced grandiosity, raised artistry and created a theme and music.
Step 3: draw the 'before' and 'after' value curve
The last five minutes — two lines on one chart. Horizontally — the factors from step 1 plus the new ones from the grid, vertically — the level of the offer. The 'before' line repeats the market profile; the 'after' line shows where you match the market and where you create a gap. The method requires the new curve to have focus (two or three strong factors), divergence from the market and a memorable tagline — one phrase about the value.
Typical mistakes
The first mistake — only 'Create': additions without elimination inflate the budget and do not change the position. The second — confusing Reduce with Eliminate: reducing keeps the factor in play, eliminating removes it entirely. The third — copying the leader's curve: that returns you to the 'red ocean', just with a delay. And the last one — filling in the grid without observing customers: pain points, complaints and unspoken needs are the fuel for ERRC, not imagination.
What you get in the end
The outcome of the twenty-minute work is three artifacts: the ERRC table (factors and four types of decisions), the before/after value curve and a one-phrase value statement. That is exactly what the solution-space expansion stage of Super Oracle looks like: after breaking down the causes and contradictions, the agent suggests non-obvious options and asks a human to choose. On how to check the chosen option cheaply — in the articles "From contradiction to test" and "TRIZ: contradiction without compromise".
Questions and answers
How is Blue Ocean different from ordinary competitive analysis?
Ordinary analysis positions you inside the existing factors of competition. Blue Ocean changes the set of factors itself, taking you out of the direct fight for market share.
What does the ERRC grid mean?
Eliminate, Reduce, Raise, Create — four types of decisions about value factors.
Why draw the value curve?
It visually compares 'before' and 'after' across all factors of competition and shows where you match the market and where you create a gap.
How long does the workshop take?
About 20 minutes: listing the factors, filling in the ERRC grid and the before/after value curve.
Does the method suit a small business?
Yes: Blue Ocean changes the set of value factors, not the advertising budget, so it works without large investments.
Can ERRC be applied to internal processes?
Yes: the four questions work equally well for a product, a service and an internal process.
Where is Blue Ocean used on the site?
In the agents: the ERRC grid is part of the solution-space expansion that Super Oracle runs after breaking down the causes and contradictions.
What does the team get in the end?
The ERRC table for all factors, the before/after value curve and a short value statement of the new solution.