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#VPGen. Dr. Rod King. [email protected] & h:p://businessmodels.ning.com & h:p://twi:er.com/RodKuhnKing Innovator Marketer Accountant 3ACT BUSINESS MODEL STORYBOARD for Apple’s Classic iPod An Informa*on Rich Pla1orm for Rapid Business Model Prototyping, Strategy, Valida*on, and Execu*on
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The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

Oct 17, 2014

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Business

Despite the recent proliferation in business model representation, business model visualization is relatively poor and still fraught with many problems. I’ve observed 10 Business Model Problems, each problem of which has been solved by the “3-Act Business Model Network,” a simple and information-rich platform for visualizing, organizing, integrating, discussing, innovating on, testing, evaluating, benchmarking, and managing business models as well as stories.

In brief, the 3-Act Business Model Network provides an all-in-one platform for facilitating not only business model prototyping, strategy, validation, and execution but also story prototyping, testing, and management. Using the “rich” 3-Act Business Model Network, you could achieve great savings in time, cost, and energy while holistically prototyping and managing business models as well as inspirational stories of change.

To facilitate use of the 3-Act Business Model Network, the tool is applied to the business model of Apple’s iPod; see http://goo.gl/zdZ05f

Below is a list of 10 problems that plague other representations of a business model.

#1: TOWER-OF-BABEL Problem

#2: BUILDING BLOCK OVERLOAD Problem

#3: INCOHERENT BUSINESS-MODEL-LOGIC Problem

#4: REVERSE-INCOME-STATEMENT Problem

#5: ASSUMPTION-FORMULATION-AND-TESTING Problem

#6: PERFORMANCE-MANAGEMENT Problem

#7: EXTERNAL BUSINESS MODEL INTEGRATION Problem

#8: HOLISTIC BUSINESS MODEL Problem

#9: UNILEVEL BUSINESS MODEL Problem

#10: SHARED-VALUE Problem
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Page 1: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Innovator    

Marketer    

Accountant    

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Page 2: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Innovator    

Marketer    

Accountant    

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

JOB  TO  GET  DONE  

Sa*sfy  Demand   Create  Demand   Generate  Profit  

Page 3: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Innovator    

Marketer    

Accountant    

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

JOB  TO  GET  DONE  

Sa*sfy  Demand   Create  Demand   Generate  Profit  

Page 4: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Innovator    

Marketer    

Accountant    

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Page 5: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Innovator  (Product)  

Marketer  (Customer)  

Accountant  (Profit)  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Page 6: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Page 7: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Product/Value  ProposiUon  q  iPod  Hardware  

q “A  Thousand  Songs  in  Your  Pocket”  

Channels  &  RelaUonships  q www.apple.com  q Apple  Retail  Stores  q  iTunes  Store  q Big  Box  Retailers  

Customer/Job-­‐To-­‐Get-­‐Done  q Luxury  SpoDer  q “Blue  Ocean”  XP  q Listen  to  Music  Everywhere  q Bulky  players;  small  storage  

Inputs/Partners    q Original  Equipment  Manu.  q Record  Companies  

 

Internal  Resources  q Staff/Employees  q Brand/Culture  q  IP    

Processes/AcUviUes  q Luxury  Spot  Strategy  q Hardware  Design  q SoPware  Design  q MarkeQng  &  Sales  

Revenue  (Delight):  High  Items  (Sources/Streams)  q  iPod  Hardware  q  iTunes  Store  q Commissions  

PROFIT  (VALUE):  High  q High  Profit  Margin  q Extraordinary  Profit  q Luxury  Spot  Strategy  Ent.  Industry:  Music  (Share)  

Cost  (Pain):  High  Items  (Structure)  q Staff/Employees  q Manufacturing  q MarkeQng  &  Sales  

Page 8: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Product/Value  ProposiUon  q  iPod  Hardware  

q “A  Thousand  Songs  in  Your  Pocket”  

Channels  &  RelaUonships  q www.apple.com  q Apple  Retail  Stores  q  iTunes  Store  q Big  Box  Retailers  

Customer/Job-­‐To-­‐Get-­‐Done  q Luxury  SpoDer  q “Blue  Ocean”  XP  q Listen  to  Music  Everywhere  q Bulky  players;  small  storage  

Inputs/Partners    q Original  Equipment  Manu.  q Record  Companies  

 

Internal  Resources  q Staff/Employees  q Brand/Culture  q  IP    

Processes/AcUviUes  q Luxury  Spot  Strategy  q Hardware  Design  q SoPware  Design  q MarkeQng  &  Sales  

Cost  (Pain):  High  Items  (Structure)  q Staff/Employees  q Manufacturing  q MarkeQng  &  Sales  

Revenue  (Delight):  High  Items  (Sources/Streams)  q  iPod  Hardware  q  iTunes  Store  q Commissions  

PROFIT  (VALUE):  High  q High  Profit  Margin  q Extraordinary  Profit  q Luxury  Spot  Strategy  Ent.  Industry:  Music  (Share)  

Page 9: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Product/Value  ProposiUon  q  iPod  Hardware  

q “A  Thousand  Songs  in  Your  Pocket”  

Channels  &  RelaUonships  q www.apple.com  q Apple  Retail  Stores  q  iTunes  Store  q Big  Box  Retailers  

Customer/Job-­‐To-­‐Get-­‐Done  q Luxury  SpoDer  q “Blue  Ocean”  XP  q Listen  to  Music  Everywhere  q Bulky  players;  small  storage  

Inputs/Partners    q Original  Equipment  Manu.  q Record  Companies  

 

Internal  Resources  q Staff/Employees  q Brand/Culture  q  IP    

Processes/AcUviUes  q Luxury  Spot  Strategy  q Hardware  Design  q SoPware  Design  q MarkeQng  &  Sales  

Cost  (Pain):  High  Items  (Structure)  q Staff/Employees  q Manufacturing  q MarkeQng  &  Sales  

Revenue  (Delight):  High  Items  (Sources/Streams)  q  iPod  Hardware  q  iTunes  Store  q Commissions  

PROFIT  (VALUE):  High  q High  Profit  Margin  q Extraordinary  Profit  q Luxury  Spot  Strategy  Ent.  Industry:  Music  (Share)  

(Problem

-­‐SoluQ

on  Fit;  Produ

ct-­‐M

arket  F

it)  

Page 10: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Product/Value  ProposiUon  q  iPod  Hardware  

q “A  Thousand  Songs  in  Your  Pocket”  

Channels  &  RelaUonships  q www.apple.com  q Apple  Retail  Stores  q  iTunes  Store  q Big  Box  Retailers  

Customer/Job-­‐To-­‐Get-­‐Done  q Luxury  SpoDer  q “Blue  Ocean”  XP  q Listen  to  Music  Everywhere  q Bulky  players;  small  storage  

require(s)   delight(s)  

require(s)   delight(s)  

Inputs/Partners    q Original  Equipment  Manu.  q Record  Companies  

 

Internal  Resources  q Staff/Employees  q Brand/Culture  q  IP    

require(s)   affect(s)  

require(s)   deliver(s)  

drive(s)  

requires  

delights  

Processes/AcUviUes  q Luxury  Spot  Strategy  q Hardware  Design  q SoPware  Design  q MarkeQng  &  Sales  

Revenue  (Delight):  High  Items  (Sources/Streams)  q  iPod  Hardware  q  iTunes  Store  q Commissions  

PROFIT  (VALUE):  High  q High  Profit  Margin  q Extraordinary  Profit  q Luxury  Spot  Strategy  Ent.  Industry:  Music  (Share)  

Cost  (Pain):  High  Items  (Structure)  q Staff/Employees  q Manufacturing  q MarkeQng  &  Sales  

Page 11: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  for  Apple’s  Classic  iPod  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

Product/Value  ProposiUon  q  iPod  Hardware  

q “A  Thousand  Songs  in  Your  Pocket”  

Channels  &  RelaUonships  q www.apple.com  q Apple  Retail  Stores  q  iTunes  Store  q Big  Box  Retailers  

Customer/Job-­‐To-­‐Get-­‐Done  q Luxury  SpoDer  q “Blue  Ocean”  XP  q Listen  to  Music  Everywhere  q Bulky  players;  small  storage  

require(s)  

require(s)  

Inputs/Partners    q Original  Equipment  Manu.  q Record  Companies  

 

Internal  Resources  q Staff/Employees  q Brand/Culture  q  IP    

require(s)   affect(s)  

require(s)   deliver(s)  

drive(s)  

requires  

delights  

Processes/AcUviUes  q Luxury  Spot  Strategy  q Hardware  Design  q SoPware  Design  q MarkeQng  &  Sales  

Revenue  (Delight):  High  Items  (Sources/Streams)  q  iPod  Hardware  q  iTunes  Store  q Commissions  

PROFIT  (VALUE):  High  q High  Profit  Margin  q Extraordinary  Profit  q Luxury  Spot  Strategy  Ent.  Industry:  Music  (Share)  

Cost  (Pain):  High  Items  (Structure)  q Staff/Employees  q Manufacturing  q MarkeQng  &  Sales  

delight(s)  

delight(s)  

Page 12: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 “[A]  business  model  makes  it  possible  for  you  to  gain  a  comprehensive  and  realisQc  understanding  of  how  to  make  money.”    Larry  Bossidy  and  Ram  Charan  in  the  book,  “ConfronQng  Reality”  

Why  Use  “Business  Model”  As  Unit  of  Analysis?  

Page 13: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

Law  of  the  3-­‐Act  Business  Model  Although  Stories,  Businesses,  Business  Models,  Living  Systems,  and  Other  OrganizaUons  Appear  Different  on  the  Surface,  Every  Story,  Enterprise,  Business  Model,  Living  System,  or  OrganizaQon  on  the  Planet  Has  the  Same  Fractal  “DNA”  Structure  Which  Consists  of  a  Network  of  3  “Acts”  or  Sub-­‐models:    v     Value  CreaUon  Act:  System  

v     Value  ProposiUon  Act:  Environment  (Local/Global)    

v     Value  Sharing  (Profit)  Act:  Impact  or  Trade-­‐off  (Pain;  Delight)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Page 14: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

SYSTEM  (Object/Tool/Business  Model)  

Page 15: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

3-­‐ACT  BUSINESS  MODEL  

Page 16: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

 

VALUE  PROPOSITION  MODEL  

 

VALUE  SHARING  (PROFIT)  MODEL  

 

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Page 17: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

 

VALUE  PROPOSITION  MODEL  

 

VALUE  SHARING  (PROFIT)  MODEL  

 

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Innovator’s  PerspecQve  

Marketer’s  PerspecQve  

Investor’s  PerspecQve  

Page 18: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

 

VALUE  PROPOSITION  MODEL  

 

VALUE  SHARING  (PROFIT)  MODEL  

 FITNESS?   FITNESS?  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Innovator’s  PerspecQve  

Marketer’s  PerspecQve  

Investor’s  PerspecQve  

FITNESS?  

Product   Customer   Profit  

Page 19: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL:  How?  

VALUE  PROPOSITION  MODEL:  What?  

VALUE  SHARING  (PROFIT)  MODEL:  

Why?  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Page 20: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL:  How?  

VALUE  PROPOSITION  MODEL:  What?  

VALUE  SHARING  (PROFIT)  MODEL:  

Why?  

Bargaining  Pow

er  of  Sup

pliers  

Bargaining  Pow

er  of  C

ustomers  

Threat  of  New  Entrants  

Threat  of  SubsUtute  Products  or  Services  

Porter’s  5  Forces  for  Industry  Profitability  &  Fitness  Analysis  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Page 21: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL:  How?  

VALUE  PROPOSITION  MODEL:  What?  

VALUE  SHARING  (PROFIT)  MODEL:  

Why?  

4  Global  Environment  Forces  for  External  Fitness  Analysis  Indu

stry  Ecosystem

 (IE):  Sup

ply  

Market  E

cosystem

 (ME):  D

eman

d  

Key  Trends  &  Complementors  (KTC):  PESTLIED  (-­‐/+)  

Macro-­‐Economic  Influencers  (MEI):  Global  Economy  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Page 22: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL:  How?  

VALUE  PROPOSITION  MODEL:  What?  

VALUE  SHARING  (PROFIT)  MODEL:  

Why?  

SWOT  Analysis  W:  W

EAKN

ESSES  (-­‐)  

 S:  STR

ENGTH

S  (+)  

O:  OPPORTUNITIES  (+)  

T:  THREATS  (-­‐)  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Page 23: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL:  How?  

VALUE  PROPOSITION  MODEL:  What?  

VALUE  SHARING  (PROFIT)  MODEL:  

Why?  

“E.R.I.C.”  Value  InnovaDon  TacDcs  E:  Elim

inate  

 I:  In

crease  

C:  Create  

R:  Reduce  

Law  of  the  3-­‐Act  Business  Model:  Storyboard  of  Paradigm  for  Universal  System  Modeling  

Page 24: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

DisrupDon  Spot  

Luxury  Spot  

Strategic  Choice  

Sweet  Spot  Profit  Model/  Strategy/  

Value  Proposi*on  

Blue  Ocean  Profit  Model/  Strategy/  

Value  Proposi*on  

Luxury  Spot  (“Differen*a*on”)  Profit  Model/  Strategy/  

Value  Proposi*on  

DisrupUon  Spot/Lean  (“Low  Cost”)  Profit  Model/  Strategy/  

Value  Proposi*on  

4  BUSINESS  PROFIT  MODELS,  WINNING  STRATEGIES,  AND  VALUE  PROPOSITIONS  

Trade-­‐off  Map  of  Cost  vs.  Revenue    

(-­‐):  PAIN:  Cost  (Size;  Complexity;  Inaccessibility;  Delay)  

(+):  DELIGHT:  Revenue  

(Performance;  Quality;  Brand;  

Customiza*on)  

Key  Profitable  Model    Unprofitable  Model  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  hDp://businessmodels.ning.com  &  hDp://twiDer.com/RodKuhnKing  

Market  Segment  (Job-­‐To-­‐Get-­‐Done/Goal;  Product/Tool):  ………………..…..……..…….…………  ……………………………………………………………………….…………….………….……………….  

“Insane”  Happiness  (Value)  Ideal  Final  Result  (IFR)  Infinite  Shared  Happiness  “Invisible  Hand”    

Page 25: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

DisrupDon  Spot  

Luxury  Spot  

Strategic  Choice  

Sweet  Spot  Profit  Model/  Strategy/  

Value  Proposi*on  

Blue  Ocean  Profit  Model/  Strategy/  

Value  Proposi*on  

Luxury  Spot  (“Differen*a*on”)  Profit  Model/  Strategy/  

Value  Proposi*on  

DisrupUon  Spot/Lean  (“Low  Cost”)  Profit  Model/  Strategy/  

Value  Proposi*on  

Apple  iPod’s  GENERIC  PROFIT  MODEL,  WINNING  STRATEGY,  AND  VALUE  PROPOSITION  Trade-­‐off  Map  of  Cost  vs.  Revenue  

 

(-­‐):  PAIN:  Cost  (Size;  Complexity;  Inaccessibility;  Delay)  

(+):  DELIGHT:  Revenue  

(Performance;  Quality;  Brand;  

Customiza*on)  

Key  Profitable  Model    Unprofitable  Model  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  hDp://businessmodels.ning.com  &  hDp://twiDer.com/RodKuhnKing  

Market  Segment  (Job-­‐To-­‐Get-­‐Done/Goal;  Product/Tool):  Entertainment  Industry  (Music):  Listen  to  music  

“Insane”  Happiness  (Value)  Ideal  Final  Result  (IFR)  Infinite  Shared  Happiness  “Invisible  Hand”    

Page 26: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

DisrupDon  Spot  

Luxury  Spot  

Strategic  Choice  

Sweet  Spot  Customer  Experience  

Blue  Ocean  Customer  Experience  

Luxury  Spot  Customer  Experience  

DisrupUon  Spot/Lean  Customer  Experience  

CUSTOMER  EXPERIENCE,  VALUE  PROPOSITION,  JOB-­‐TO-­‐GET-­‐DONE,  AND  (VALUE)  FACTORS  Trade-­‐off  Map  of  Customer  Pain  vs.  Customer  Delight  

 

(-­‐):  PAIN:  Cost;  Size;  Complexity;  Inaccessibility;  Delay  

(+):  DELIGHT:    

Func*onality;  Performance;  

Quality;  Brand;  

Customiza*on  

Key  Valuable  Experience    Non-­‐valuable  Experience  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  hDp://businessmodels.ning.com  &  hDp://twiDer.com/RodKuhnKing  

Market  Segment  (Job-­‐To-­‐Get-­‐Done/Goal;  Product/Tool):  Entertainment  Industry  (Music):  Listen  to  music  

“Insane”  Happiness  (Value)  Ideal  Final  Result  (IFR)  Infinite  Shared  Happiness  “Invisible  Hand”    

Page 27: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

DisrupDon  Spot  

Luxury  Spot  

Strategic  Choice  

Sweet  Spot  Customer  Experience  

Blue  Ocean  Customer  Experience  

Luxury  Spot  Customer  Experience  

DisrupUon  Spot/Lean  Customer  Experience  

CUSTOMER  EXPERIENCE,  VALUE  PROPOSITION,  AND  JOB-­‐TO-­‐GET-­‐DONE  for  Apple’s  iPod  Trade-­‐off  Map  of  Customer  Pain  vs.  Customer  Delight  

 

(-­‐):  PAIN:  Size;  Complexity  

(+):  DELIGHT:    

Func*onality;  Performance  (Storage);  Quality;  Brand;  

Customiza*on  

Key  Valuable  Experience    Non-­‐valuable  Experience  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  hDp://businessmodels.ning.com  &  hDp://twiDer.com/RodKuhnKing  

Market  Segment  (Job-­‐To-­‐Get-­‐Done/Goal;  Product/Tool):  Entertainment  Industry  (Music):  Listen  to  music  

“Insane”  Happiness  (Value)  Ideal  Final  Result  (IFR)  Infinite  Shared  Happiness  “Invisible  Hand”    

Page 28: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

“Businesses  will  increasingly  find  themselves  dealing  with  external  forces  they  didn’t  foresee.  To  seize  opportuniQes  or  defend  themselves,  they’ll  have  to  change  faster  and  more  oPen.  But  what  should  a  business  change?  How  much  should  it  change,  how  soon  and  how  fast?”    Larry  Bossidy  and  Ram  Charan  in  the  book,  “ConfronQng  Reality”  

What  to  Change?  

Page 29: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

More  …  

q  HOLISTIC  BUSINESS-­‐MODEL  Problem  

q  UNILEVEL  BUSINESS-­‐MODEL  Problem  

q  SHARED  VALUE  Problem  

INCOHERENT  BUSINESS-­‐MODEL-­‐LOGIC  Problem    Logical  relaQonships  of  how  a  business  makes  money  are  either  incoherent  or  not  shown  in  nearly  all  representaQons  of  a  business  model.  ExisQng  business  model  diagrams  are  staQc.    

ASSUMPTION-­‐FORMULATION-­‐AND-­‐TESTING  Problem    The  process  of  formulaQng  and  tesQng  assumpQons  (hypotheses/proposal/  plans)  of  a  business  model  is  currently  unsystemaQc  and  whimsical.    

EXTERNAL  BUSINESS-­‐MODEL-­‐  INTEGRATION    Problem    ExisQng  business  model  representa-­‐Qons  do  not  easily  integrate  with  the  large  body  of  knowledge  in  Strategic  Management,  Startups,  Product  InnovaQon,  and  Project  Planning.  

BUILDING-­‐BLOCK-­‐OVERLOAD  Problem    It  is  brain-­‐unfriendly  to  present  9  or  more  building  blocks  at  a  single  level.  Many  people  feel  overwhelmed  and  cannot  remember  to  reproduce  the  building  blocks  of  a  business  model.    

10  BUSINESS  MODEL  PROBLEMS  THAT  YOU  CAN  IMMEDIATELY  

ELIMINATE    

Use    3-­‐Act  Business  Model  Storyboard  to  Solve  the  Following  Problems  …  

PERFORMANCE  MANAGEMENT  Problem    Nearly  all  business  model  diagrams  are  not  directly  integrated  with  the  tool  of  the  Balanced  Scorecard.  Business  model  diagrams  are  hardly  used  for  managing  business  model  performance.  

TOWER-­‐OF-­‐BABEL  Problem    Too  many  “unique”  frameworks  and  languages  for  business  model  visualizaQon.  The  frameworks  are  oPen  contradictory  and  don’t  speak  to  each  other.    

REVERSE-­‐INCOME-­‐STATEMENT  Problem    Most  diagrams  of  business  models  do  not  explicitly  contain  “Profit”  as  a  building  block.  This  makes  it  difficult  to  focus  on  designing  for  profit  as  well  as  preparing  a  Reverse  Income  Statement.  

10  BUSINESS  MODEL  PROBLEMS  THAT  YOU  CAN  IMMEDIATELY  ELIMINATE  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Page 30: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

“A  Business  Model  Prototype  Is    

A  Thousand  Times  More  Cost-­‐Effec*ve    Than  

A  Business  Plan”  

Business  Model  Prototype  vs.  Business  Plan  

Page 31: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

Appendix  

MulUlevel  VisualizaUon  of    The  3-­‐Act  Business  Model  Storyboard  

 q     Bird’s  Eye  View  (Macro-­‐Logic  of  Business  Model)  

q     Eagle  Eye’s  View  (Meso-­‐Logic  of  Business  Model)  

q     Worm’s  Eye  View  (Micro-­‐Logic  of  Business  Model)  

Page 32: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

ENVIRONMENT  (Local/Global)  

IMPACT  or  TRADE-­‐OFF  (-­‐/+)  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

 

VALUE  PROPOSITION  MODEL  

 

VALUE  SHARING  (PROFIT)  MODEL  

 

FITNESS?  

FITNESS?   FITNESS?  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  

Innovator’s  PerspecQve  

Marketer’s  PerspecQve  

Investor’s  PerspecQve  

Page 33: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Bird’s  Eye  View  (Business  Model  Chain:  Macro-­‐Logic)  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

Page 34: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Business  Model  Tree  –  Hierarchical  Decomposi*on  of  Macro-­‐Logic)  

Product/Value  ProposiUon        

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done        

Inputs/Partners        

Internal  Resources        

Processes/AcUviUes        

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)        

Page 35: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network:  Meso-­‐Logic)  

Product/Value  ProposiUon        

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done        

Inputs/Partners        

Internal  Resources        

Processes/AcUviUes        

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)        

Page 36: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network:  Meso-­‐Logic)  

Product/Value  ProposiUon        

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done        

Inputs/Partners        

Internal  Resources        

Processes/AcUviUes        

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)        

(Problem

-­‐SoluQ

on  Fit;  Produ

ct-­‐M

arket  F

it)  

Page 37: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network:  Meso-­‐Logic)  

Product/Value  ProposiUon        

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done        

require(s)  

require(s)  

Inputs/Partners        

Internal  Resources        

Processes/AcUviUes        

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)        

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 38: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network:  Meso-­‐Logic)  

Product/Value  ProposiUon        

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done        

require(s)  

require(s)  

Inputs/Partners        

Internal  Resources        

Processes/AcUviUes        

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)        

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 39: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  the  MarkeDng  Mix:  4Ps  of  MarkeDng)  

Product/Value  ProposiUon  q   Product      

Channels  &  RelaUonships  q   Place  q   PromoUon  

 

Customer/Job-­‐To-­‐Get-­‐Done        

require(s)  

require(s)  

Inputs/Partners    

   

Internal  Resources          

Processes/AcUviUes  

   

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)  q   Pricing      

PROFIT  (VALUE)        

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 40: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Kaplan  &  Norton’s  Balanced  Scorecard)  

Product/Value  ProposiUon        

Channels  &  RelaUonships      

 

Customer/Job-­‐To-­‐Get-­‐Done  q       Customer  PerspecQve      

require(s)  

require(s)  

Inputs/Partners    

   

Internal  Resources  q  Learning  and  Growth  

PerspecQve  

Processes/AcUviUes  q       Process  PerspecQve      

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)  q       Financial  PerspecQve      

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 41: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Michael  Porter’s  Value  Chain)  

Product/Value  ProposiUon        

Channels  &  RelaUonships  q       Outbound  LogisDcs  q       MarkeDng  &  Sales  q       Service  

Customer/Job-­‐To-­‐Get-­‐Done        

require(s)  

require(s)  

Inputs/Partners  q  Inbound  LogisDcs      

Internal  Resources  q  Firm  Infrastructure  q  Human  Resource  Mngt  q  Technology  Development  q  Procurement  

Processes/AcUviUes  q       OperaDons      

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)  q       Profit  Margin      

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 42: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Business  Model  Network  –  Elements  and  Shared  Value  Logic  of  Rod  King’s  “S.E.M.P.O.R.C.E.S.”  Chain)  

Product/Value  ProposiUon  q       Output/Product  (O)      

Channels  &  RelaUonships  q       Retailers/Distributors/                  Channels  (R)    

Customer/Job-­‐To-­‐Get-­‐Done  q     Customers/Consumers  (C)    

   

require(s)  

require(s)  

Inputs/Partners  q  Suppliers/Inputs  (S)  

   

Internal  Resources  q  Employees  (E)  q  Machinery/Equipment  (M)  

 

Processes/AcUviUes  q       Process  (P)      

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)  q       Shared  Value  (S)      

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 43: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Osterwalder  &  Pigneur’s  Business  Model  Canvas)  

Product/Value  ProposiUon  q Value  ProposiUon  (VP)      

Channels  &  RelaUonships  q Channels  (CH)  q Customer  RelaUonships  (CR)    

Customer/Job-­‐To-­‐Get-­‐Done  q Customer  Segment  (CS)  

 

 

require(s)  

require(s)  

Inputs/Partners  q Key  Partners  (KP)      

Internal  Resources  q Key  Resources  (KR)  

 

Processes/AcUviUes  q Key  AcUviUes  (KA)      

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)  q Cost  Structure  (C$)      

Revenue  (Delight)  q Revenue  Streams  (R$)      

PROFIT  (VALUE)        

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 44: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Ash  Maurya’s  Lean  Canvas)  

Product/Value  ProposiUon  q       Unique  Value  ProposiUon  q       SoluUon    

Channels  &  RelaUonships  q       Channels      

Customer/Job-­‐To-­‐Get-­‐Done  q     Customer  Segment  q     Problem  (Trade-­‐off)  

 

require(s)  

require(s)  

Inputs/Partners    

   

Internal  Resources  q       Unfair  Advantage    

 

Processes/AcUviUes      

   

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)  q       Cost  Structure      

Revenue  (Delight)  q       Revenue  Streams      

PROFIT  (VALUE)  q Key  Metrics      

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

(Problem

-­‐SoluQ

on  Fit;  Produ

ct-­‐M

arket  F

it)  

Page 45: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Mark  Johnson’s  4-­‐Box  Business  Model)  

Product/Value  ProposiUon  q       Customer  Value  ProposiUon      

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done    

   

require(s)  

require(s)  

Inputs/Partners    

   

Internal  Resources  q       Key  Resources  

 

Processes/AcUviUes  q       Key  Processes      

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)        

Revenue  (Delight)        

PROFIT  (VALUE)  q       Profit  Formula      

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 46: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Bossidy  &  Charan’s  Business  Model)  

Product/Value  ProposiUon        

Channels  &  RelaUonships        

Customer/Job-­‐To-­‐Get-­‐Done  q       Customer  Base  (Needs)  

   

require(s)  

require(s)  

Inputs/Partners    

   

Internal  Resources  q       People:  Team  q       OrganizaUon    

Processes/AcUviUes  q       Strategy  q       OperaUons  q       IteraQon;Root-­‐cause  analysis  q       Environment  Scan:  SWOT  

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)  q       Capital  Intensity      

Revenue  (Delight)  q       Revenue  Growth      

PROFIT  (VALUE)  q       OperaUng  Margin  q       Cash  Flow  q       Return  on  Investment  q       (Financial  History:  Fit)    

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 47: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Eagle’s  Eye  View  (Generic  Business  Model  Network  –  Elements  and  Profit  Logic  of  Malik’s  Enterprise  Architecture  Model)  

Product/Value  ProposiUon  q Value  ProposiUon  q Products  &  Services      

Channels  &  RelaUonships  q Channels  q Customer  Demands  &  

RelaUonships    

Customer/Job-­‐To-­‐Get-­‐Done  q Customer  Type  q Customer      

require(s)  

require(s)  

Inputs/Partners  q Partner  Type  q Business  Partner  

 

Internal  Resources  q Required  Competency  q Resource/Asset  

 

Processes/AcUviUes        

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)  q Cost  Model      

Revenue  (Delight)  q Revenue  Model      

PROFIT  (VALUE)  q       Profit  Model      

requires  

drive(s)  

delights  

delight(s)  

delight(s)  

Page 48: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

delivers  

requires  

drives  

requires  

Product/Value  ProposiUon  (P/VP)      

Channels  &  RelaUonships  (CH/CR)      

Customer/Job-­‐To-­‐Get-­‐Done  (CS/JTGD)      

require(s)  

require(s)  

Inputs/Partners  (I/KP)      

Internal  Resources  (IKR)      

Processes/AcUviUes  (P/KA)      

require(s)   affect(s)  

require(s)   deliver(s)  

Cost  (Pain)  (C$)      

Revenue  (Delight)  (R$)      

PROFIT  (VALUE)  (P$)      

drive(s)  

requires  

3-­‐ACT  BUSINESS  MODEL  MODEL  STORYBOARD  An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

delights  

delight(s)  

delight(s)  

Page 49: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

3-­‐ACT  BUSINESSMODEL  

VALUE  CREATION  MODEL  

VALUE  PROPOSITION  MODEL  

VALUE  SHARING  (PROFIT)  MODEL  

I/KP   IKR   P/KA   P/VP   CH/CR   CS/CJTGD   C$   R$   P$  

I/KP   -­‐  

IKR   -­‐  

P/KA   -­‐  

P/VP   -­‐  

CH/CR   -­‐  

CS/JTGD   -­‐  

C$   -­‐  

R$   -­‐  

P$   -­‐  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

From    -­‐>  To  

I/KP:  Inputs/Partners  IKR:  Internal  Resources  P/KA:  Processes/AcQviQes  

P/VP:  Product/Value  ProposiQon  CHCR:  Channels  &  RelaQonships  CS/JTGD:  Customer/Job-­‐To-­‐Get-­‐Done  

C$:  Cost  (Structure)  R$:  Revenue  (Streams)  P$:  Profit  

Key  

3-­‐ACT  BUSINESS  MODEL  STORYBOARD  Worm’s  Eye  View  (Business  Model  Network  of  Rela*onships:  Micro-­‐Logic  of  Input-­‐Output  Matrix/“Concept  Map”)  

Page 50: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

VALUE  CREATION  MODEL:  COST  REDUCTION  

VALUE  PROPOSITION  MODEL:  REVENUE  INCREASE  

Inputs/Partners  q Co-­‐creaQon;  Social  Media  q Open  Source  CollaboraQon  q Crowd-­‐funding/sourcing  q FracQonalizaQon/Co-­‐owner  q  Investor/Sponsor/Donor  q Mergers  &  AcquisiQons  

Internal  Resources  (Physical/Intellectual/Emo*onal/Spiritual  Resources)  q Creator;  Broker;  Landlord  q Peer-­‐to-­‐Peer  Plaoorm  q Facilitated  Network  q Patents  (“Fences”;  Barriers)    

Processes/AcUviUes  q OperaQonal  Excellence;  JIT  q AutomaQon  (Self-­‐service/DIY)  q GamificaQon;  DigitalizaQon  q Ecosystem  Management  q Problem  Solving;  ConsulQng  q CompeQQve  Strategies  

Product/Value  ProposiUon  q Asset  Sale/Direct  Sale  q Product  Leadership/Extension  q Used/2nd  Hand  Product;  Bargain  q CustomizaQon  (Value  Factors)  q Bundling/Unbundling  q Product/SoPware  as  a  Service  

Channels  &  RelaUonships  q Offline/Online;  (In)direct  Sale  q Franchise;  Licensing;  Affiliates  q Distributor;  Disintermediator  q Ad  Network;  Brand  MulQplier  q AggregaQon/DisaggregaQon  q AucQon/Reverse  AucQon  

Customer/Job-­‐To-­‐Get-­‐Done  q Customer  InQmacy/Loyalty  q B2B;  B2C  q Long  Tail;  Community  (Hub)  q Two-­‐sided  Market  (Segments)  q MulQ-­‐sided  Market  (Plaoorm)  q Luxury/Mass  Market/Niche  

Cost  (Pain)  q Outsourcing;  SpecializaQon  q Group  Deals  q Lending/RenQng/Leasing  q Cross-­‐subsidizaQon  q FracQonalizaQon/Co-­‐owner    

Revenue  (Delight)  q Pre-­‐payment;  AmorQzaQon  q Discount;  Dynamic  Pricing  q Razor  Blade  (“Bait  &  Switch”)  q Usage  Fee;  SubscripQon  Fee  q Tiered  Payment;  Freemium  q DonaQon;  Free  

PROFIT  (VALUE)  q Shared  Value  (Profit)  q Transient  CompeQQve  Adv.  q Sustainable  CompeQQve  Adv.  q Red  Ocean;  Low  Cost/Margin  q Blue  Ocean;  Luxury  Spot  q DisrupQve  InnovaQon  Spot  

PROFIT  MODEL:  PROFIT  INCREASE  

Business  Profit  Management  (Pagerns/Tac*cs)     51  BUSINESS  PROFIT  PATTERNS  

(Business  Profit  Innova*on  for  Compe**ve  Advantage)  

Page 51: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

       BUSINESS  DNA  MAP:  A  Visual  Framework  for  Unified  Strategic  Planning  &  Management      

‘Jigsaw  Puzzle’  of  Business  Modeling  Ontology  for  Living  Systems  

S   E   M   P   O   R   C   E   S  Suppliers/  Inputs  

Employees/  Culture/  Brand/IP  

Machinery/  Technology/  Infra’  

Processes/  Strategies  

Output:  Product/  Service  

Retailers/  Distributors/  Channels  

Customers/  Consumers  (Care/Support)  

Environ-­‐ment  

Shared  Greatn./  Impact  

Partners  (Suppliers/Materials/  Info/Energy)  

Key  Resources   AcQviQes  (Processes)  

Value  ProposiQon  (Jobs  To  Get  Done)  

Customer  RelaQonship  Management  

Industry/  Gov.  

SHARED  VALUE/  PROFIT  (Pain:  -­‐  Delight:  +  

CAPABILITIES:  CORE  COMPETENCIES   LOCAL  ENVIRONMENT  (Demand)  

 

GLOBAL  ENV.  (Trends)    

ENTERPRISE  (SYSTEM/Supply:  Inside  the  Enterprise)  

   

Design  

   

Needs  

   Aspiratns  

ECOSYSTEM  (PLANET/ECONOMY/FOREST;  SPECIES;  INDUSTRY/SUPPLY  CHAIN/VALUE  CHAIN)  

GLOBAL  COMPETI-­‐TIVE  FORCES  

COMPE-­‐TITIVE  ADVAN-­‐TAGE  

INPUT   PROCESSING   OUTPUT   EXTERNAL  ENVIRONMENT   RESULT  (Impacts/  Effects)  BUSINESS  SYSTEM  (Cause)  

BUSINESS  DNA  MAP:  Global  3-­‐Act  Business  Model  (G3BM)  Storyboard  

D N A

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Page 52: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

                                                                                     Global  3-­‐Act  Business  Model  (G3BM)  Storyboard:  Fractal  Hierarchy  for  Business  Model  Fitness  

Environment  

Business  Model  (3-­‐Act)  

World  (Global)  

NaUon  (Economy/  Value  Network)  

Industry  

Sector  (Locality/Supply  Chain)  

Region  

Supp

liers  

Custom

ers  

SubsQtutes  (In/Direct  Compe*tors)  

New  Entrants  (Poten*al  Compe*tors)  

W:  W

EAKN

ESSES  (-­‐)  

S:  STR

ENGTH

S  (+)  

O:  OPPORTUNITIES  (+)  

T:  THREATS  (-­‐)    #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Page 53: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

Environment  

Business  Model  (3-­‐Act)  

World  (Global)  

NaUon  (Economy/  Value  Network)  

Industry  

Sector  (Locality/Supply  Chain)  

Region  

Supp

liers  

Custom

ers  

SubsQtutes  (In/Direct  Compe*tors)  

New  Entrants  (Poten*al  Compe*tors)  

Macro-­‐Economic  Forces  (MEF):  Global  Economy  

Indu

stry  Ecosystem

 (IE):  Sup

ply  

Market  E

cosystem

 (ME):  D

eman

d  

Key  Trends  &  Complementors  (KTC):  PESTLIED  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

                                                                                     Global  3-­‐Act  Business  Model  (G3BM)  Storyboard:  Fractal  Hierarchy  for  Business  Model  Fitness  

Page 54: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

Past  Reality  Business  Model  

             

Present  Reality  Business  Model  

           

Future  Reality  Business  Model  

             

Global  3-­‐Act  Business  Model  (G3BM)  Plan    

An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Strategy  

Short/Medium/Long-­‐term  

WHAT  to  change?   TO  WHAT  to  change?  

WHY  change?  

HOW  to  change?  

Page 55: The Rich 3-Act Business Model STORYBOARD: Rapid Business Model Prototyping, Strategy, Validation, and Execution

Past  Reality  (“As  Was”)  

Business  Model              

Present  Reality  (“As  Is”)  

Business  Model            

Future  Reality  (“To  Be”)  

Business  Model              

 Bus.  Model  (3-­‐Act)  

 Bus.  Model  (3-­‐Act)  

 Bus.  Model  (3-­‐Act)  

Industry  Ecosystem  

Market  Ecosystem  

 

Business  Model  (3-­‐Act)  

Macro-­‐Economic  Influencers  

Key  Trends  &  Complementors  

Mission/Vision/Purpose/Ideals/  Ideal  Final  Result  For  Business  Model  

 #VPGen.  Dr.  Rod  King.  [email protected]  &  h:p://businessmodels.ning.com  &  h:p://twi:er.com/RodKuhnKing  

Strategy  Short/Medium/Long-­‐term  

Global  3-­‐Act  Business  Model  (G3BM)  Plan    

An  Informa*on  Rich  Pla1orm  for  Rapid  Business  Model  Prototyping,  Strategy,  Valida*on,  and  Execu*on