Tools for Transforming Ideas into Strategy By Eliza Chute and Kym Cole
Feb 15, 2016
Tools for Transforming
Ideas into Strategy
By Eliza Chute and Kym Cole
Eliza Chute – Penn Grad ’10– Earth Rights
International
Kym Cole– Penn Grad ’11– Fulbright Scholar
Founders of Interprise
Investment Fund
Organizing partners of Gazaab
Interprise @ SmallWorld
Entrepreneur Creation Challenge
Contact Us!
Gazaab Interprise @ SmallWorld Entrepreneur Creation Challenge
www.gazaab.org
Idea Ping Pong
Directions:
1) Form groups of 5 to 6 people.2) One person should take 2 minutes to explain
his/her business idea.3) As the speaker is explaining, each member of the
group writes down ideas and suggestions on a post-it.
4) Next, each member of the group shares his/her ideas with the speaker.
5) Don’t forget to give the speaker your post it!
Business Model Canvas
What is it?
• Business Model: describes the rationale of how a business creates, delivers, and captures value
• Business Model Canvas: a tool to analyze, discuss and describe a business model– Blueprint– 9 Basic Building Blocks
Customer Segments
• Customers can be divided into different segments based on common needs, behaviors, etc.
• Customer groups represent different segments if– They are reached through different channels– They require different relationships– They have largely different profitability
Different Types of Customer Segments
Mass Market
Niche Market
Segmented
Diversified
Multi-Sided Platform
Example
• For whom are we creating value?• What are our customer segments?• Who are our most important customers?
Customer Relationships
Describes the types of relationships a company establishes with specific Customer Segments.
Possible motivations:
Customer acquisition Customer retention Increasing sales
Example
• What type of relationship does each of our Customer Segments expect us to establish and maintain with them?
• Which relationships have we established?
• How costly are these relationships?
Value Propositions
• Reason a customer turns to one company over another
• Solves a problem or satisfies a need– New offer or existing offer with added benefits
• Each VP is a bundle of products or services that satisfies the requirements of a specific customer segment
Example
• What value do we deliver to the customer?• Which one of our customer’s problems are we
helping to solve? • What bundles of products and services are we
offering to each Customer Segment?• Which customer needs are we satisfying?
ChannelsDescribes how a company communicates with and reaches its Customer Segments to deliver a Value Proposition.
Example• How do our Customer Segments want to be
reached?
• Which channels work best and are most cost efficient?
• How can we integrate our channels with customer routines?
Revenue Streams
• Represents the cash a company gets from each of its customer segments
• 2 different Types of revenue streams– Transaction and recurring
Different Ways to Generate Revenue Streams
Asset sale
Usage fee
Subscription Fees
Lending/Renting/Leasing
Licensing
Brokerage fees
Advertising
Example
• What are the customers willing to pay for the value?
• What do they currently pay? (competitors)• What does each revenue stream contribute to
overall revenues?
Key ResourcesThe most important assets required to make a business model work.Types of resources:
Physical Intellectual
Human Financial
Key Activities
• The most important things a company must do to make its business model work
• Categories of Activities– Production– Problem Solving– Network/Platform
Example
• What key activities do our value propositions require?– Distribution channels?– Customer relationships?– Revenue Stream?
Key Partners
The network of suppliers and partners that make the business model work.
Motivations for partnerships:– Optimization and
economy of scale– Reduction of risk
and uncertainty– Acquisition of resources
and activities
Cost Structure
• The costs incurred to operate a business model
• What type of business is it?Cost Driven Value Driven
More Resources
• http://www.businessmodelgeneration.com/canvas
• http://alexosterwalder.com/
• http://www.growingsocialventures.org/en/course-content/social-business-model-canvas
Eliza Chute – Penn Grad ’10– Earth Rights
International
Kym Cole– Penn Grad ’11– Fulbright Scholar
Founders of Interprise
Investment Fund
Organizing partners of Gazaab
Interprise @ SmallWorld
Entrepreneur Creation Challenge
Contact Us!
Gazaab Interprise @ SmallWorld Entrepreneur Creation Challenge
www.gazaab.org