Business Model Correlation At the Kaospilots, we work with many different thoughts and models in our four disciplines – Creative Business, Project, Process and Leadership Design, and several of these models can be thought of as directly interlinked, even though they are made from different schemes of thought and by different people. By thinking these models as part of the same framework, and developing them in tandem, they can feed into each other and enrich the understanding of each other. The models I will explain as interlinked in this paper are business/project models: • The Hedgehog concept – Jim Collins, Good to Great • KaosPilot variant of Dee Hock Stepping Stones – Dee Hock/KaosPilot • The Business Model Canvas ‐ Alexander Osterwalder & Yves Pigneur, Business Model Generation • The Buyer Utility Map – W. Chan Kim, Renee Mauborgne, Blue Ocean Strategy • Strategy Canvas ‐ W. Chan Kim, Renee Mauborgne, Blue Ocean Strategy I will not go into extensive explanations of each of the models, but expect the reader to have knowledge of these models, or alternatively to dive into the sources to read the basic facts about the models. The Hedgehog Concept The Jim Collins concept is based on three overlapping circles, where you can create your best in the center field where all three circles overlap. 1) what you are deeply passionate about 2) what you can be the best in the world at 3) what best drives your economic engine – what people want to pay for
Business Models Interlinked
Mar 31, 2016
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Business Model Correlation AttheKaospilots,weworkwithmanydifferentthoughtsandmodelsinourfourdisciplines–CreativeBusiness,Project,ProcessandLeadershipDesign,andseveralofthesemodelscanbethoughtofasdirectlyinterlinked,eventhoughtheyaremadefromdifferentschemesofthoughtandbydifferentpeople.Bythinkingthesemodelsaspartofthesameframework,anddevelopingthemintandem,theycanfeedintoeachotherandenrichtheunderstandingofeachother.ThemodelsIwillexplainasinterlinkedinthispaperarebusiness/projectmodels:
• TheHedgehogconcept–JimCollins,GoodtoGreat• KaosPilotvariantofDeeHockSteppingStones–DeeHock/KaosPilot• TheBusinessModelCanvas‐AlexanderOsterwalder&YvesPigneur,
BusinessModelGeneration• TheBuyerUtilityMap–W.ChanKim,ReneeMauborgne,BlueOcean
Strategy• StrategyCanvas‐W.ChanKim,ReneeMauborgne,BlueOceanStrategy
Iwillnotgointoextensiveexplanationsofeachofthemodels,butexpectthereadertohaveknowledgeofthesemodels,oralternativelytodiveintothesourcestoreadthebasicfactsaboutthemodels.
The Hedgehog Concept TheJimCollinsconceptisbasedonthreeoverlappingcircles,whereyoucancreateyourbestinthecenterfieldwhereallthreecirclesoverlap.1)whatyouaredeeplypassionateabout2)whatyoucanbethebestintheworldat3)whatbestdrivesyoureconomicengine–whatpeoplewanttopayfor
The KaosPilot variant of Dee Hock Stepping Stones TheSteppingStonesbyDeeHockwasoriginallyconceivedasanorganizationaldevelopmentmodel,usediteratively.InspiredbyourworkwithDeeHock,theKaospilotlateraddedtwoother“stones”tothemodel:IdeaandNeed,andwearenowusingthemodelasthebasisforPreject,i.e.gettingallstakeholdersonthesamepagebeforeheadingintopraxisinaProject.
The Business Model Canvas TheBusinessModelCanvasisagreatframeworkforcreatingtheoverviewofthebusinessenginebehindabusinessidea.Itrequirestheusertothinkofboththevaluecreationpartandtheorganizationalandcoststructurepartofabusiness.
The Buyer Utility Map TheBuyerUtilityMapfromBlueOceanStrategywasoriginallypublishedinHarvardBusinessReviewinanarticletitled:“KnowingaWinningBusinessIdeaWhenYouSeeOne”.Themapisamatrixwith6distinctivestepsintheusersexperiencewiththeproduct/serviceonthehorizontalaxe:Purchase,Delivery,Use,Supplements,Maintenance,Disposal.And6UtilityLeversontheverticalaxe:CustomerProductivity,Simplicity,Convenience,Risk,FunandImage,EnvironmentalFriendliness.ThepointoftheUtilityMapisthatyou’llhavetobeabletoshowthatyouaredoingsomethingnew/differentfromthecompetitioninatleastoneofthefieldsinthematrixtoclaimyouhaveawinningbusinessidea.
Blue Ocean Strategy Canvas Agraphical“analysis”ofthewayyourcompetitorsandthemarketarefulfillingthecustomer’sneeds,andthewayyouare.Oftentocreateablueoceanisaboutreframingthequestions,andperceivingtheproduct/service/customerneedfromanewangle,i.e.whenyouaresellingshortdistanceflights,areyouthencompetingwithbusinessclassorareyoucompetingwithtrainandcartravel?
Correlation between models Themodelsandconceptsarecorrelating,sobydevelopingthemintandemandusingthemodelstoconsistencycheckingeachother,youwillgainadeeperunderstandingofyourbusinessconceptandamoreconsistentbasisforcommunicatinganddevelopingyourbusinessidea.StartingwiththeHedgehogConcept(HC),yourDreamsshouldfeeddirectlyintoyourIdeaintheSteppingStoneModel(SS).YouranalysisoftheNeedintheSSwillgiveyoutwoanswers:Whoneedsit,andthusWhatwilltheypayfor.TheWhatshouldbeconsistentwiththeeconomicdriversintheHC,TheWhoneedsitwillfeeddirectlyintotheCustomerSegmentintheBusinessModelCanvas(BMC)TheEconomicdriver/PayforintheHCwillfuelyourValuePropositionintheBMC,andalsofeedtheRevenueStreaminBMC.AndstayingwiththeHC,theBestatwillfeeddirectlyintotheKeyActivitiesandtheKeyResourcesintheBMC.AndthiswilllaterinyourworkwithBMChelpyoudefineyourKeyPartners,becausetheyaretheoneswhoshouldcoveralltheKeyActivities,thatarenecessaryforcreatingthebusiness,butyouandyourteamarenotdoing.
TakingitastepfurtheryoucanlookattherighthandsideoftheBMC,i.e.thevaluecreationpart.ThispartmustbeconsistentwithyourConceptintheSS.AndtheTeamintheSSmodelshallbeconsistentwith/giveyouinputtoyourdefinitionofKeyResourcesandKeyPartnersintheBMC.TheLefthandsideoftheBMC,i.e.theenginebehind,andcostoftheValueCreationwillfeedintotheStructureoftheSSmodel.
FinallyTheBuyerUtilityMap(BUM)willalsofeeddirectlyintoyourValuePropositioninyourBMC.ThefieldsintheBUMwhereyouroffersaredistinctlydifferentfromtherestofthemarket/competition,willbetheareasinyourBlueOceanStrategyCanvas(SC),whereyouareeitheroppositeofthecompetitionorwherethereisnocompetitionatallbecauseyouarelookingatthemarketandserviceinanewway,i.e.yourBlueOcean.
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