BUSINESS MODEL INNOVATION Training Summary @patrickpijl @maaikedoyer @BusModInc
Business Model Innovation by Business Models Inc. Training Summary
Aug 11, 2014
Summary of our Business Model Innovation training including 10 tips for Business Model Innovation.
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BUSINESS MODEL INNOVATION
Training Summary
@patrickpijl @maaikedoyer @BusModInc
THE WORLD IS CHANGING
ONLINE REVOLUTION
MARKETS CAME ALREADY UP THE SPEED OF DEVELOPMENTS HAS INCREASED
DESIGNING BETTER BUSINESSES DESIGNING BETTER BUSINESSES
CUSTOMER SEGMENTS
KEY PARTNERS
COST STRUCTURE REVENUE STREAMS CHANNELS
CUSTOMER RELATIONSHIPS
KEY RESOURCES
VALUE PROPOSITIONS KEY ACTIVITIES
YOUR CURRENT BUSINESS MODEL
CURRENT BUSINESS MODEL
WHAT KIND OF RELATIONSHIP DO WE MAINTAIN WITH OUR
CUSTOMERS?
PERSONAL CONTACT? AUTOMATIC? SELF-
SERVICE?
THROUGH WHAT CHANNELS DO WE
DELIVER OUR PRODUCTS AND
SERVICES?
WHAT CUSTOMER NEEDS DO WE SATISFY?
WHAT PROBLEM DO WE HELP
OUR CUSTOMERS SOLVE?
WHAT ADVANTAGES DO OUR PRODUCTS AND SERVICES PROVIDE OUR CUSTOMERS
WITH?
WHAT PRODUCTS AND SERVICES DO WE DELIVER TO OUR
CUSTOMERS
WHAT TYPE OF KEY ACTIVITIES DO WE
PERFORM?
WHAT KEY RESOURCES DOES OUR PROPOSITION
REQUIRE?
PHYSICAL? INTELLECTUAL?
HUMAN? FINANCIAL?
WHO ARE OUR KEY PARTNERS?
WHAT IS OUR
MOTIVATION TO WORK WITH PARTNERS?
WHAT KEY
RESOURCES DO WE ACQUIRE THROUGH
PARTNERS?
WHAT KEY ACTIVITIES DO OUR PARTNERS
PERFORM?
WHO IS OUR CUSTOMER?
FOR WHOM DO WE CREATE VALUE?
CAN WE
DISTINGUISH DIFFERENT CUSTOMER SEGMENTS?
WHAT ARE THE INHERENT COSTS IN OUR CURRENT
BUSINESS MODEL?
WHAT IS THE SIZE OF EACH COST?
WHAT REVENUE STREAMS DO WE
GENERATE?
WHAT IS THE SIZE OF EACH REVENUE STREAM?
CURRENT BUSINESS MODEL
+/- +/- +/-
+/- +/-
THE CONTEXT
WHAT IS HAPPENING IN THE WORLD AROUND YOU?
VISION AND AMBITION
WHAT IS YOUR HIGHER PURPOSE?
CUSTOMER DISCOVERY
WHO IS OUR CUSTOMER? WHAT DOES HE OR SHE WANTS?
WHAT IS HER WILLINGNESS TO PAY?
WHAT IS THE JOB YOU GET DONE FOR YOUR CUSTOMER?
THE BUSINESS MODEL PROCESS
!! ! ! ! ! ! !!!!!!!!!!DESIGNING BETTER BUSINESSES
!
!
BUSINESS MODEL INNOVATION
SHAKE YOUR BUSINESS MODEL!
DESIGN? IT’S A JOURNEY OF EXPLORATION
1. GENERATE OPTIONS 2. EXPLORE OPTIONS
3. CHECK AGAINST DESIGN CRITERIA 4. REPEAT
IT’S A PROCESS! THERE IS NO SINGLE RIGHT ANSWER
KILL YOUR DARLINGS!
BUSINESS MODEL INNOVATION TECHNIQUES
FORESEE THE FUTURE
“THIS PRESENT MOMENT USED TO BE THE UNIMAGINABLE FUTURE.”
Stewart Brand Co-Founder, Global Business Network
“The Clock of the Long Now”
FRESHWATCHING
ELIMINATE RAISE
Which factors can you eliminate that your industry has long competed on?
Which factors should be raised well above the industry’s standard?
REDUCE CREATE
Which factors should be reduced well below the industry standard?
Which factors should be created that the industry has never offered?
BLUE OCEAN
APPLY BUSINESS MODEL PATTERNS
CHEAP INKJET PRINTERS ENCOURAGE YOU TO BUY EXPENSIVE CARTRIDGES
Top 20% Focus on a small Number of products, Each selling in high volume
LONG TAIL Focus on a lage number of products, each selling in low volumes
#"of"products"
#"of"s
ales
"
OFFER
DISTRIBUTION CHANNELS
CUSTOMER RELATIONSHIPS
CUSTOMER SEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY ACTIVITIES
PARTNER NETWORK
KEY RESOURCES
The Multi-Sided Platform Pattern
Revenue flow 2
Revenue flow 1
Value Proposition 1
Customer Segment 1
Value Proposition 2
Customer Segment 2
Platform
Platform Management
Service
Provisioning
Platform Promotion
Possible Revenue flow
Subsidy
Platform Management and Development
FROM OWNING TO USING
4 epicenters of innovation
Resource driven Proposition driven
Customer driven Revenue driven
LOOK AT THE CURRENT BUSINESS MODEL…
… AND WRITE DOWN THE 3 MOST IMPORTANT PRODUCTS OR SERVICES
REMOVE NUMBER 1! WHAT WILL YOU DO?
“WHAT IF….?”
WHERE ELSE CAN WE SELL
OUR PRODUCTS
WHICH PARTNERS CAN ADD EVEN MORE VALUE
WHICH SERVICES CAN
WE OFFER
HOW CAN WE IMPROVE OUR
RELATIONSHIP WITH OUR CUSTOMERS
HOW CAN WE ELIMINATE
FIXED COSTS
BIG DATA
HOW CAN WE DOUBLE OUR
TOTAL REVENUES
WHAT IF WE OFFER OUR
PRODUCT FOR FREE
HOW CAN WE IMPROVE OUR
CUSTOMERS LIFE
WHICH NEW CUSTOMER SEGMENTS
CAN WE SERVE
WHAT IF YOU WOULD SELL A SUBSCRIPTION
OUR WORST NIGHTMARE
BUSINESS MODEL OPTION
WHAT KIND OF RELATIONSHIP DO WE MAINTAIN WITH OUR
CUSTOMERS?
PERSONAL CONTACT? AUTOMATIC? SELF-
SERVICE?
THROUGH WHAT CHANNELS DO WE
DELIVER OUR PRODUCTS AND
SERVICES?
WHAT CUSTOMER NEEDS DO WE SATISFY?
WHAT PROBLEM DO WE HELP
OUR CUSTOMERS SOLVE?
WHAT ADVANTAGES DO OUR PRODUCTS AND SERVICES PROVIDE OUR CUSTOMERS
WITH?
WHAT PRODUCTS AND SERVICES DO WE DELIVER TO OUR
CUSTOMERS
WHAT TYPE OF KEY ACTIVITIES DO WE
PERFORM?
WHAT KEY RESOURCES DOES OUR PROPOSITION
REQUIRE?
PHYSICAL? INTELLECTUAL?
HUMAN? FINANCIAL?
WHO ARE OUR KEY PARTNERS?
WHAT IS OUR
MOTIVATION TO WORK WITH PARTNERS?
WHAT KEY
RESOURCES DO WE ACQUIRE THROUGH
PARTNERS?
WHAT KEY ACTIVITIES DO OUR PARTNERS
PERFORM?
WHO IS OUR CUSTOMER?
FOR WHOM DO WE CREATE VALUE?
CAN WE
DISTINGUISH DIFFERENT CUSTOMER SEGMENTS?
WHAT ARE THE INHERENT COSTS IN OUR CURRENT
BUSINESS MODEL?
WHAT IS THE SIZE OF EACH COST?
WHAT REVENUE STREAMS DO WE
GENERATE?
WHAT IS THE SIZE OF EACH REVENUE STREAM?
EVALUATION AND QUALIFICATION
BUSINESS MODEL MECHANICS
DEF: BUSINESS MODEL MECHANICS THE INNER WORKINGS OF AN ORGANIZATION’S BUSINESS MODEL. HOW THE BUILDING BLOCKS OF A BUSINESS MODEL WORK TOGETHER TO PRODUCE A BETTER OUTCOME
source: www.strategyzer.com
6 QUESTIONS HOW DO YOU PERFORM ON A SCALE FROM 0 TO 10?
0 10 2 4 6 8
source: www.strategyzer.com
MECHANICS:
SWITCHING COSTS
HOW EASY OR HARD IS IT FOR YOUR CUSTOMER TO SWITCH TO ANOTHER
COMPANY?
source: www.strategyzer.com
MECHANICS:
RECURRING REVENUES
IS EVERY SALES A NEW EFFORT (TRANSACTIONAL) OR WILL IT
RESULT IN FOLLOW-UP REVENUES AND PURCHASES?
source: www.strategyzer.com
MECHANICS:
EARN BEFORE YOU SPEND
ARE YOU EARNING MONEY BEFORE YOU ARE SPENDING IT (E.G. FOR
PRODUCTION, PLATFORMS ETC.)?
source: www.strategyzer.com
MECHANICS:
GAME CHANGING COST STRUCTURE
IS YOUR COST STRUCTURE
SUBSTANTIALLY DIFFERENT AND BETTER THAN THAT OF
COMPETITORS?
source: www.strategyzer.com
MECHANICS:
GETTING OTHERS TO DO THE WORK
HOW MUCH DOES YOUR BUSINESS MODEL GET CUSTOMERS OR THIRD
PARTIES TO CREATE VALUE FOR YOU?
source: www.strategyzer.com
MECHANICS:
SCALABILITY
HOW RAPIDLY AND HOW EASILY CAN YOU GROW YOUR BUSINESS MODEL
WITHOUT HITTING ROADBLOCKS (E.G. INFRASTRUCTURE, CUSTOMER
SUPPORT ETC.)
source: www.strategyzer.com
WHAT IS YOUR SCORE?
BUSINESS MODEL VALIDATION
THINK ABOUT YOUR NEW BUSINESS MODEL AS IF YOU ARE A START-UP
What IS actually a start-up?!
“A START-UP IS NOT A SMALL VERSION
OF A LARGE COMPANY.”
Steve%Blank%
A START-UP IS A TEMPORARY
ORGANIZATION IN SEARCH FOR A
PROFITABLE, SCALABLE AND REPEATABLE BUSINESS MODEL.
A START-UP IS ABOUT SEARCHING
Steve%Blank%
A (LARGE) COMPANY IS ABOUT
EXECUTION Steve%Blank%
YOU NEED TO CLARIFY YOUR ASSUMPTIONS
YOU NEED TO TEST YOUR ASSUMPTIONS
Source: Alex Osterwalder Instagram
GET OUT OF THE BUILDING…
WATCH FIRST, THEN ASK LOOK FOR NEEDS, NOT SOLUTIONS
PIVOT YOUR BUSINESS MODEL
STOP FEATURITIS NOW
10 TIPS FOR BUSINESS MODEL
INNOVATION
1 START WITH THE AS-IS. MAP THE CURRENT BUSINESS MODEL, CONTEXT AND VISION ON A LARGE POSTER WITH 3M POST IT NOTES.
2 DON’T TRY THIS ALONE. LET YOUR COLLEAGUES OR FRIENDS HELP YOU!
3 LEARN FROM OTHER BUSINESS MODELS!
4 APPLY BUSINESS MODEL PATTERNS.
5 THINK AS A BUSINESS MODEL DESIGNER. DO NOT RELY ON 1 MODEL, BUILD PROTOTYPES
PROTOTYPING LET’S YOU FAIL EARLY TO SUCCEED SOONER
IDEO.COM
“ ”
6 “VISIT THE FUTURE FREQUENTLY!”
7 “SHOW ME THE MONEY!”
8 “DRAWING IS THE NEW WRITING” THINK & WORK VISUALLY!
9 DON’T RELY ON YOUR ASSUMPTIONS.
JUST DO IT! 10
CONTACT US FOR MORE INFORMATION!
MAAIKE DOYER STRATEGY DESIGNER
E: [email protected] T: +31 6 81 82 25 18 W: www.businessmodelsinc.com
PATRICK VAN DER PIJL CEO & FOUNDER
E: [email protected] T: +31 6 51 29 57 78 W: www.businessmodelsinc.com
DESIGNING BETTER BUSINESSES DESIGNING BETTER BUSINESSES
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