2 Day Workshop on Business Model Design

58,687 views

Published on

These are the slides (draft) I am using to animate a 2 day workshop with faculty at the tecnologica de Monterrey in Guadalajara.

Published in: Business, Technology
13 Comments
277 Likes
Statistics
Notes
No Downloads
Views
Total views
58,687
On SlideShare
0
From Embeds
0
Number of Embeds
1,006
Actions
Shares
0
Downloads
12,982
Comments
13
Likes
277
Embeds 0
No embeds

No notes for slide
  • 2 Day Workshop on Business Model Design

    1. 1. 2 Day Workshop on Business Model Design Tecnologico de Monterrey Guadalajara, Mexico, June 7-8, 2007
    2. 2. change is the process by which the future invades our lives -> Alvin Toffler
    3. 3. business people don’t just need to understand designers better; they need to become designers Roger Martin, Dean Rotman School “ ”
    4. 4. why is each of us here?
    5. 5. your expectations for the next 2 days?
    6. 6. this workshop is an experiment!
    7. 7. what is design?
    8. 8. tell me, what is design?
    9. 9. the only thing that’s not designed is nature Dave Kelly, IDEO “ ”
    10. 10. adaptation of means to a preconceived end dictionary.com “ ”
    11. 11. transformation of existing conditions into preferred ones Herbert Simon, 1969 “ ”
    12. 13. redesign of a shopping cart
    13. 14. video
    14. 15. what is striking in the video?
    15. 16. characteristics of design thinking?
    16. 17. user-centered
    17. 18. creativity & exploration
    18. 19. interdisciplinary
    19. 20. holistic
    20. 21. fit
    21. 22. the designer’s toolbox
    22. 23. co-creation
    23. 24. ideation
    24. 25. visualization
    25. 26. prototyping
    26. 27. and business?
    27. 28. how can design thinking contribute to business?
    28. 29. what is a business model?
    29. 30. what’s your business model?
    30. 31. evolution of the concept
    31. 32. understandings
    32. 33. existing frameworks (i)
    33. 34. existing frameworks (ii)
    34. 35. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS ACTIVITY CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS INFRASTRUCTURE CUSTOMER OFFER FINANCE a business model describes the value an organization offers to various customers and portrays the capabilities and partners required for creating, marketing, and delivering this value and relationship capital with the goal of generating profitable and sustainable revenue streams DISTRIBUTION CHANNELS [Osterwalder (2004) The Business Model Ontology] business model framework
    35. 36. external forces
    36. 37. 5 forces BUSINESS MODEL legal environment social environment competition customer needs technological change
    37. 38. the business model’s place in the company BUSINESS MODEL ORGANIZATION STRATEGY TECHNOLOGY
    38. 39. occurrences of the term “business model” in scholarly reviewed journals why this rise of the term business model?
    39. 40. YOU INC.
    40. 41. Vinod Khosla, VC
    41. 42. play Niklas Zennström, serial entrepreneur
    42. 43. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS ACTIVITY CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS DISTRIBUTION CHANNELS [Osterwalder (2004) The Business Model Ontology] design your business model
    43. 44. choose your market
    44. 45. design YOUR business
    45. 46. design frenzy process ? !
    46. 47. break-out session
    47. 48. ISSUES OFFERS ACTORS MARKET [Osterwalder (2004) The Business Model Ontology] sketch out the market
    48. 49. VALUE PROPOSITION CUSTOMER SEGMENTS value proposition 1 value proposition 2 … customer segment 1 customer segment 2 … CUSTOMER OFFER what value do you offer to which customer segments? (model)
    49. 50. why talk about business models?
    50. 51. how do you describe a business model?
    51. 52. without a common language
    52. 53. how do you communicate a business model?
    53. 54. <ul><li>Development plan </li></ul><ul><li>Quisque augue felis, commodo a, elementum id, faucibus id, sem. Aenean rutrum enim. Praesent pulvinar dignissim nisl. Cras a nunc. Donec tincidunt odio sit amet lacus. Pellentesque metus tortor, ullamcorper vitae, lobortis vel, euismod in, mi. Ut laoreet, tellus laoreet blandit mollis, massa purus posuere purus, quis molestie ligula massa eu metus. Duis placerat, nulla sit amet ornare interdum, neque nunc mollis leo, vitae porttitor mi orci sit amet neque. Donec at enim. In facilisis tellus gravida ligula. Phasellus ut lorem. Pellentesque ac tortor eget augue suscipit ullamcorper. Aenean eleifend porta orci. </li></ul><ul><li>Etiam at arcu. Vestibulum lacinia nunc in eros. Suspendisse potenti. Aliquam erat volutpat. Donec gravida. Lorem ipsum dolor sit amet, consectetuer adipiscing elit. Cum sociis natoque penatibus et magnis dis parturient montes, nascetur ridiculus mus. Maecenas vel enim et metus semper fringilla. Donec ornare arcu. Maecenas faucibus ligula convallis nibh. Mauris dui quam, congue eu, commodo nec, tristique in, enim. Nulla auctor semper urna. Quisque a elit eu purus iaculis vestibulum. Aliquam dictum risus at odio. Fusce at lorem et elit faucibus placerat. Aenean velit. Proin elit odio, blandit et, scelerisque quis, pulvinar a, dui. Nunc magna dolor, bibendum ut, accumsan congue, tincidunt sit amet, neque. Proin consequat tincidunt lacus. In urna dui, congue nec, tincidunt sit amet, facilisis imperdiet, lorem. </li></ul><ul><li>Morbi sed nibh. Vivamus vitae dolor. Ut bibendum volutpat mi. Pellentesque quis magna non lectus elementum pretium. Aliquam quis est vitae arcu consequat fringilla. Cras magna risus, placerat eget, egestas consectetuer, ornare vel, felis. Nam ornare justo id orci mattis ultricies. Morbi luctus. Ut pretium odio ac libero. Nunc sollicitudin pharetra lorem. Aenean scelerisque, lacus eget ullamcorper scelerisque, ipsum urna viverra mi, eget viverra quam eros eget velit. Ut lacinia feugiat purus. Cum sociis natoque penatibus et magnis dis parturient montes, nascetur ridiculus mus. Etiam nunc nisl, aliquam blandit, luctus id, commodo laoreet, sem. Phasellus sit amet orci ut sapien vulputate pellentesque. Pellentesque dapibus purus et quam. Nam sit amet magna in neque dignissim sodales. Aenean non justo nec magna lobortis volutpat. </li></ul>Strategy Lorem ipsum dolor sit amet, consectetuer adipiscing elit. Cras in tortor. Sed posuere erat. Maecenas pulvinar nulla eu magna. Vivamus semper, risus ut egestas pulvinar, lectus ante feugiat quam, sit amet congue odio lacus ac ipsum. Aliquam suscipit, est ut volutpat vulputate, nulla felis pulvinar libero, non ornare libero ipsum tristique tortor. Fusce sed lorem vitae justo feugiat malesuada. Donec aliquet. Vivamus semper eros nec diam. Vivamus sem arcu, imperdiet nec, congue ac, scelerisque vel, nulla. Donec et mauris. Integer a nulla vulputate pede consequat euismod. Praesent molestie urna nec leo. Proin eros. Maecenas ac sem nec dui sodales tempus. Maecenas suscipit egestas velit. Suspendisse vel tortor. Proin imperdiet, sem nec aliquet ultrices, nunc est egestas eros, non hendrerit magna eros eget augue. Maecenas sed leo vitae leo faucibus vulputate. Proin dignissim eros at augue. Nam luctus nulla non nibh. Nam at lorem ac mauris laoreet viverra. In placerat consequat nunc. Donec rhoncus nunc ac urna. Integer vestibulum condimentum orci. Fusce velit turpis, malesuada quis, scelerisque ut, eleifend vitae, ipsum. Vestibulum eu erat. Vestibulum justo nisl, tincidunt et, semper vel, tristique quis, eros. Vestibulum tempus, massa vel consectetuer congue, erat magna consequat purus, a facilisis orci nibh vitae purus. Nam tincidunt venenatis ligula. Nunc orci nulla, ornare quis, lobortis viverra, dapibus at, turpis. Suspendisse sit amet nisl at enim tincidunt blandit. Curabitur augue est, suscipit sed, egestas sit amet, vehicula vitae, tellus. Maecenas nec metus vel nisi interdum pellentesque. Words Text Text Text 18% 300% 12% 1% through inappropriate means
    54. 55. Here CEOs 10° Managers 60° Here Staff 360° Ok
    55. 56. how do you implement a business model?
    56. 57. with outdated methods
    57. 58. how do you measure the success of a business model?
    58. 59. we don’t
    59. 60. how do you change a business model and innovate ?
    60. 61. we re-invent the wheel
    61. 62. “ Business model innovation matters” and it is a top priority of CEOs
    62. 63. Operating Margin Growth in Excess of Competitive Peers compound annual growth rate over five years [Source: IBM, CEOs are expanding the innovation horizon: important implications for CIOs]
    63. 64. Benefits Cited by Business Model Innovators percent of respondents [Source: IBM, Global CEO Study 2006]
    64. 65. the process of designing innovative business models
    65. 66. the focus of the business model innovator & designer
    66. 67. user-centered
    67. 68. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS ACTIVITY CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS DISTRIBUTION CHANNELS
    68. 69. Nokia: Jan Chipchase
    69. 70. creativity & exploration
    70. 71. Googleplex
    71. 72. 70:20: 10
    72. 73. API
    73. 74. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS ACTIVITY CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS DISTRIBUTION CHANNELS
    74. 75. continuous innovation
    75. 76. interdisciplinary approach
    76. 77. Grameen Phone Bangladesh
    77. 78. village telephony telecom infrastructure customer relationships villager activity configuration micro-credit Grameen Bank mobile phone revenues source of revenue mobile telephony billing telecom operators Grameen Bank (billing) phone ladies phone ladies
    78. 79. holistic design
    79. 80. Apple iTunes & iPod
    80. 81. iPod cost structure lifestyle brand “ high-end” consumer prod. & softw. design hardware & softw. dev. hardware revenues iTunes multimedia downloads e-commerce multimedia rights mgmt iBook content producers Apple stores dealer network multimedia revenues hardware suppliers brand management hardware distribution content distribution content
    81. 82. strategic fit
    82. 83. the Amazon.com you know
    83. 84. Amazon Simple Storage Services (S3)
    84. 85. selling stuff on the Web IT infra customer relationships mass customer data services Amazon.com data grid partners selling stuff Amazon S3 Amazon.com Internet API Web2.0 companies warehousing & distribution distribution content management product selection A9 product search data storage fees product search search engine revenues e-commerce sites Internet marketing
    85. 86. back to YOU INC.
    86. 87. the customer interface
    87. 88. it better be integrated…
    88. 89. VALUE PROPOSITION COMMUNICATION & DISTRIBUTION CHANNELS value proposition 1 value proposition 2 … channel 1 channel 2 … OFFER how do you reach your customers? (model) CUSTOMER SEGMENTS customer segment 1 customer segment 2 … CUSTOMER
    89. 90. AWARENESS EVALUATION designing channels PURCHASE AFTER SALES TRANSFER COMMUNICATION & DISTRIBUTION CHANNEL
    90. 91. VALUE PROPOSITION CUSTOMER RELATIONSHIP value proposition 1 value proposition 2 … mechanism 1 mechanism 2 … OFFER CUSTOMER SEGMENTS CUSTOMER how do you build relationships with your customers? (model) customer segment 1 customer segment 2 …
    91. 92. END DAY 1 good work!
    92. 93. DAY 2
    93. 94. summary of yesterday <ul><li>we’re applying the business model concept </li></ul><ul><li>many good ideas developed </li></ul><ul><li>enthusiasm for projects </li></ul><ul><li>productivity quite good (but no Swiss watches) </li></ul><ul><li>room to improve visualization </li></ul><ul><li>lack of « crazy » ideas </li></ul>
    94. 95. hard work continues
    95. 96. 1. identify interdisciplinary stakeholders -> set-up team
    96. 97. do you have to get the IT team out of their cubicles?
    97. 98. 2. understand (business) environment –> frame problem
    98. 99. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS ACTIVITY CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS DISTRIBUTION CHANNELS [Osterwalder (2004) The Business Model Ontology] various starting points / depending on context
    99. 100. 3. suspend reality -> ideate
    100. 101. 4. bring back reality -> prototype
    101. 102. Netflix (niche) movies over the Internet COST STRUCTURE profile specialized clientele ACTIVITY CONFIGURATION large movie database independent films REVENUE STREAMS Web online movie rental (with large niche movie database)
    102. 103. 5. chose suitable design -> decide
    103. 104. 6. sketch out projects & workload -> draw implementation plan
    104. 105. … 38 man/days Project C1 Distribution Channels 120 man/days Project V2 10 man/days Project V1 Value Proposition Estimated workload Project name Area
    105. 106. 7. outline key indicators to follow -> choose measures
    106. 107. … 38 man/days Project C1 Distribution Channels 120 man/days Project V2 10 man/days Project V1 Value Proposition Target level KPI (measure) Estimated workload Project name Area
    107. 108. 8. select the right teams and people -> make responsible
    108. 109. … 38 man/days Project C1 Distribution Channels Ms. Tee 120 man/days Project V2 Mr. Jan 10 man/days Project V1 Value Proposition leader Target level KPI (measure) Estimated workload Project name Area
    109. 110. 9. execute the plan -> manage implementation & change
    110. 111. 10. evaluate, learn and redesign -> manage improvement
    111. 112. break-out session
    112. 113. VALUE PROPOSITION REVENUE STREAMS value proposition 1 value proposition 2 … revenue stream 1 revenue stream 2 … OFFER CUSTOMER SEGMENTS FINANCE how do you earn your money with this business model? (model) customer segment 1 customer segment 2 …
    113. 114. business model examples
    114. 115. Goldcorp mining low costs through open exploration CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS exploiting mines “ geology prize” 500’000 $US REVENUE STREAMS DISTRIBUTION CHANNELS Goldcorp publicly shared all of its geological data and offered US$ 500’000 in prizes for determining where they might find the next 6 million ounces of gold research
    115. 117. from copyright to creative commons
    116. 118. Skype free VoIP & value added services software development website global (non segmented) deliver voice & video quality “ eBay” large scale low margin internet software development free voice-over-IP VoIP telephony & value-added services
    117. 119. 1291 Cityhomes low cost accommodation New York low cost CUSTOMER RELATIONSHIPS the cost sensible renting out rooms keep down costs apartment owners rents DISTRIBUTION CHANNELS find demand young curious Swiss low-cost hotel/rental in New York City
    118. 120. Tecnovate low-cost multi-lingual call center outsourcing low cost CUSTOMER RELATIONSHIPS European corporations ACTIVITY CONFIGURATION keep down costs “ import” young curious Europeans to India to work REVENUE STREAMS DISTRIBUTION CHANNELS business process outsourcing “up-side down” in India
    119. 121. from bloated head to the long tail
    120. 122. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIP TARGET CUSTOMER DISTRIBUTION CHANNEL VALUE CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS FREE advertising supported mobile telephony mobile network operator that “rents out” capacity to Blyk subscribers fill out profile on the Internet marketing to mobile users with an interesting advertising profile regular ad messages via mobile phone marketing paying mobile phone minutes the young and the hip increasing the number of mobile phone users with the right profile to increase the value for advertisers INFRASTRUCTURE CUSTOMER OFFER FINANCE access to a pool of targeted young advertising public advertising fees finding and contracting advertisers advertisers sales force
    121. 123. blue oceans
    122. 124. designing blue oceans
    123. 125. > market boundaries are not given > they are reconstructed by the actions & beliefs of industry players
    124. 126. <ul><li>compete in existing markets </li></ul><ul><li>beat the competition </li></ul><ul><li>explore existing demand </li></ul><ul><li>make the value/cost trad-off </li></ul><ul><li>align with differentiation OR low cost </li></ul><ul><li>create uncontested markets </li></ul><ul><li>make competition irrelevant </li></ul><ul><li>create & capture new demand </li></ul><ul><li>break value/cost trad-off </li></ul><ul><li>align with differentiation AND low cost </li></ul>RED OCEAN BLUE OCEAN
    125. 127. differentiate your value proposition
    126. 128. <ul><li>a customer value proposition gives an overall view of a company's bundle of products, services and client advice. </li></ul><ul><li>it is the sum of the total benefits a customer is promised to receive in return for a payment (or other value transfer) </li></ul>working definition value proposition
    127. 129. what are the 5 most important competitive attributes that characterize a game console’s offer? (e.g. price, performance, design) attribute 2 e.g. price attribute 1 e.g. performance group warm-up
    128. 130. 1 2 3 4 - - <ul><li>most important attribute </li></ul><ul><li>second most important </li></ul><ul><li>… </li></ul><ul><li>… </li></ul>5 attributes
    129. 131. <ul><li>… </li></ul><ul><li>… </li></ul><ul><li>… </li></ul><ul><li>… </li></ul><ul><li>… </li></ul>
    130. 133. attribute 1 attribute 2 attribute 3 attribute 5 1 - low 5 - high 3 - medium bank’s performance [Kim & Mauborgne (2002) Charting Your Company's Future] draw a value proposition attribute 4
    131. 134. live Excel
    132. 136. eliminate raise reduce create
    133. 139. YOU INC.
    134. 140. VALUE CONFIGURATION VALUE PROPOSITION activity/resource 1 activity/resource 2 … value prop 1 value prop 2 … INFRA CHANNELS channel 1 channel 2 … which activities and resources do I need for these capabilities? (model) CUSTOMER SEGMENTS segment 1 segment 2 … CUSTOMER RELATION relation 1 relation 2 … REVENUE STREAM revenue 1 revenue 2 … CORE CAPABILITIES capability 1 capability 2 …
    135. 141. VALUE CONFIGURATION VALUE PROPOSITION activity/resource 1 activity/resource 2 … value prop 1 value prop 2 … INFRA CHANNELS channel 1 channel 2 … what do I do myself, what do I do with partners? (model) CUSTOMER SEGMENTS segment 1 segment 2 … CUSTOMER RELATION relation 1 relation 2 … REVENUE STREAM revenue 1 revenue 2 … PARTNER NETWORK partner 1 partner 2 …
    136. 142. VALUE CONFIGURATION activity/resource 1 activity/resource 2 … INFRA what’s the cost? (model) PARTNER NETWORK partner 1 partner 2 … CORE CAPABILITIES capability 1 capability 2 … COST STRUCTURE cost account 1 cost account 2 … FINANCE
    137. 143. value, difficulties, hurdles of using such a concept
    138. 144. business models in the classroom
    139. 145. judgment time
    140. 146. post-it vote: the best business model?
    141. 148. all photos from Flickr under a creative commons license authors indicated in comment page of ppt
    142. 149. When you stop learning, you stop competing. We scan the knowledge universe for you, across disciplines and industries. We transfer the best methods, tools and theory in business to your organization. we build knowledge Change does not happen accidentally it has to be managed. We help you align strategy, people and processes with respect to your organizational culture and values. we manage change Specific problems require specific skills that you do not necessarily dispose of in-house. Through our interdisciplinary network we connect you with leading domain experts. we connect Having a great vision is not sufficient - implementation counts. We help you reconcile long term views with short term actions. We make strategy everyone's job by translating it into pragmatic and prioritized projects. we operationalize Nobody knows your business environment better than yourself. We co-design your strategic vision by building on your knowledge. Through group thinking we find the right answers to the right questions together we co-create
    143. 150. annex other

    ×