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Successful business model
design
Successful business model
design
With the BM Canvas
A. Osterwalder & Y. Pigneur
With the BM Canvas
A. Osterwalder & Y. Pigneur
agendaagenda
1. The BM canvas
2. The main BM patterns
3. Build your BM3. Build your BM
4. Evaluate your BM
5. Implement your BM
agendaagenda
1. The BM canvas
2. The main BM patterns
3. Build your BM3. Build your BM
4. Evaluate your BM
5. Implement your BM
What is a business modelWhat is a business model
A coherent & effective business logic, specific to the
company, time, environment
A company specific way to create, deliver and share
value
It involves
People with specific consumption & need patterns =
customer segments
People with skills within the company (ressources) and
outside of the company (partners)= ressources
Assets & processes = ressources
Business specific revenue streams = revenue model
Why is a BM necessary?Why is a BM necessary?
It makes value generation explicit:
Revenue streams
Growth
Value for stakeholdersValue for stakeholders
Brings together context/values/people
An explicit business logic helps
maximise efficiency
Critical to understand & optimise
competitive position
Key value driversKey value drivers
1-The canvas1-The canvas
CR
Customer
relationship
KR
Key
Ressources
CS
Customer
segments
R$
Revenue
streams
C$
Cost
structure
VP
Value
proposition
CH
Channels
KA
Key Activities
KP
Key
Partnerships
1-The canvas: traditional way1-The canvas: traditional way
CR
Customer
relationship
KA
Key
Activities
Marketing
Sales
OperationsFinance
CS
Customer
segments
R$
Revenue
streams
C$
Cost
structure
VP
Value
proposition
CH
Channels
KR
Key
Ressources
KP
Key
Partnership
s
visionvisionexecutionexecution
1-The canvas: dynamic way1-The canvas: dynamic way
CSCSR$C$
CR
Customer
relationship
CR
Customer
relationship
VP
Value
VP
Value
KA
Key Activities
KR
share (depth & width)
CS
Customer
segments
CS
Customer
segments
R$
Revenue
streams
C$
Cost
structure
Value
proposition
Value
proposition
CH
Channels
CH
Channels
KR
Key
Ressources
KP
Key
Partnerships
Co-create value
executeexecute serveserve (depth & width)(depth & width)
visionvisionexecutionexecution
1-The canvas: your turn!1-The canvas: your turn!
The canvas 1-1: customer segments
(theory)
The canvas 1-1: customer segments
(theory)
Intrinsic criteria (usage & customer driven)
Homogeneous & distinct
Specific behaviours, expectations & needs
Specific types of relationship & similar access to offering
Extrinsic criteria (operation driven)
Identifiable & Measurable (accurate data, time & resource consuming)
Substantial (not too big, not too small): global niches vs mass market
Operational: accessible/durable
Examples of segments
Demographics & user profiles, geographic
Behaviorist: benefits sought, brand loyalty, usage/purchase behaviour, readiness to buy
psychographic (activities, opinions, interests, attitudes, values…)
Operating: techno, capabilities
Purchasing functions & preferences (policies, criteria, …)
Situational (urgency, applications, size of order…)
The canvas 1-1: customer segmentsThe canvas 1-1: customer segments
The golden rule
A business model is specific to a customer segment
The canvas 1-1: customer segments
(practice 1/7)
The canvas 1-1: customer segments
(practice 1/7)
The more mature the market, the more segments
From mass marketing to target marketing
From segments to individualization of needs
Fashion : purchase pattern (ex: UK)
Male: 15 types/5 groupsMale: 15 types/5 groups
Female: 20 types/ 7 groups
In depth analysis
Demographics/ expenditures
Purchases
Typical shops
attitudes
The canvas 1-1: customer segments
(practice 2/7)
The canvas 1-1: customer segments
(practice 2/7)
The canvas 1-1: customer segments
(practice 3/7)
The canvas 1-1: customer segments
(practice 3/7)
Fashion : purchase pattern (ex: UK)
mid range
dressed in the
best
distinguished
classicsprofessional
lookquality not
quantity
functional
fashion seeker
14
16
18
20
spend/item/20
conventional
appearance
mid range
suitability
selective habit
mainstream
fathers
brand boy
low cost long
last
Any shirt will do
youthful
aspiration
budgetimage
sporty basics
0
2
4
6
8
10
12
14
0 2 4 6 8 10 12 14 16
age/20
The canvas 1-1: customer segments
(practice 4/7)
The canvas 1-1: customer segments
(practice 4/7)
Fashion : purchase pattern (ex: UK)
distinguished
classics
dressed in the best
20
25
spend/item/20
Circle =% pop
youthful aspiration
Any shirt will do
functional fashion
seeker
sporty basics
budgetimage
mainstream fathers
professional look
mid range suitability
classics
quality not quantity
brand boy
low cost long last
conventional
appearance
selective habit
0
5
10
15
-2 0 2 4 6 8 10 12 14 16 18
age/20
The canvas 1-1: customer segments
(practice 5/7)
The canvas 1-1: customer segments
(practice 5/7)
rank % male pop type spend
129 8,6 conventional appearance 15
108 7,2 mid range suitability 15
105,6 8,8 selective habit 12
104,5 5,5 dressed in the best 19
97,6 6,1 mainstream fathers 1697,6 6,1 mainstream fathers 16
97,5 7,5 brand boy 13
74,9 10,7 low cost long last 7
72 4 distinguished classics 18
71,4 4,2 professional look 17
61,6 7,7 quality not quantity 8
58,5 6,5 functional fashion seeker 9
55 5 Any shirt will do 11
50 5 youthful aspiration 10
40,8 6,8 budget image 6
31,5 6,3 sporty basics 5
The canvas 1-1: customer segments
(practice 6/7)
The canvas 1-1: customer segments
(practice 6/7)
Fashion : purchase pattern (ex: UK)
Circle =% pop
4- dressed in the best
distinguished classicsprofessional look
functional fashion seeker
20
25
spend/item/20
1- conventional
appearance
2- mid range suitability
3- selective habit
5- mainstream fathers
brand boy
low cost long last
quality not quantity
functional fashion seeker
Any shirt will do
youthful aspiration
budget image
sporty basics
0
5
10
15
-2 0 2 4 6 8 10 12 14 16 18
age/20
The canvas 1-1: customer segments
(practice 7/7)
The canvas 1-1: customer segments
(practice 7/7)
Other markets
Nuclear plants: 3 to 4 segments
Automotive: 9 segments
# A segment-mini
# B segment-small
# C segment-lower-medium
# D segment-upper-medium# D segment-upper-medium
# E segment-executive
# F segment-luxury
# G segment-sports
# H segment-dual-purpose
# I segment-multi-purpose vehicle (MPV)
Mobile phones
Cosmetics?
Real estate?
Beverages?
IT?
What are the targetted customer
segments
What are the targetted customer
segments
The canvas 1-2: value
proposition
The canvas 1-2: value
proposition
Economic equation between customer/ distributor &
company
The reason to be preferred… now and (everlasting) later
The job to be done (material/immaterial)
User perceived value, made ofUser perceived value, made of
Products (I provide you with )
Service (I do for you)
Relationship (we do/are together)
User generated value
Includes:
performance, quality, price,
Design, status
Convenience, accessibility,
Risk reduction
The canvas 1-2: value
proposition
The canvas 1-2: value
proposition
segment 1 segment 2 Segment 3
advantages 2000
compatibility 300
transparency 100
internal cost (direct/indirect) 200
risk 100
transfert costs 200
UVPC g-p 1900 0 0
A GENUINE VALUE PROPOSITION is an economic equation on how to share the value created
figures in 000
Usage Value
Perceived by
customer
gain
pain
UVPC g-p 1900 0 0
price 1000
Maintenance 100
Evolution 100
Training 100
exchange value 1 300 - -
margin 500 0 0
cost 600
investments 1000
# years 5 amortized investments 200 - -
total costs 800 - -
VALUE
PROPOSITION
UVPC-costs
1100 0 0
customer 500 0 0
% commission 10% distributors 100 0 0
company (margin) 500 0 0
value shared
exchange value
production
What value propositions?What value propositions?
The canvas 1-3: channelsThe canvas 1-3: channels
sell in effort
sell out
effort
cost
brand
efficiency
delivery
efficiency
level of
service
required
value
added to
customer(% portfolio) (% of life)
own
direct
sales force
web
own
direct web
own store
partner
indirect
1/3 p stores
wholesaler
reseller
affiliation
customer network mkg
The canvas 1-3: channelsThe canvas 1-3: channels
sell in
effort
sell out
effort
cost
brand
efficiency
delivery
efficiency
level of
service
required
value
added to
customer
(%
portfolio)
(% of life)
own
direct
sales force N-A high high high high high high
web high low low medium medium low medium
own
direct web high low low medium medium low medium
own store N-A medium high high high high medium
partner
indirect
1/3 p stores high medium medium medium high high medium?
wholesaler low medium low low medium medium low
reseller medium medium low low medium medium medium?
affiliation high low low low low low low
customer network mkg high low low high low low high?
What access channels?What access channels?
The canvas 1-4: Customer
relationships
The canvas 1-4: Customer
relationships
Deliver (transaction) + exchange
(relation)= build trust
Customer acquisition vs retention
Customer intimacy & upsell (one to one)Customer intimacy & upsell (one to one)
From short to long term
The tools
CRM (level 0)
Customer assistance & survey (level 1)
Training, user conferences (level 2)
Network & communities of practice (level 3)
Co-creation & supply chain (level 4)
What kind of customer
relationship?
What kind of customer
relationship?
The canvas 1-5: Revenue
streams (1/2)
The canvas 1-5: Revenue
streams (1/2)
fixed (static variables) dynamic (market conditions)
Price list yield management (airlines, hotels)
direct feature dependent real time market
licence/ subscription auctions
usage (ppu) Future value
renting/leasing
indirect
subsidised sales (advertising) free
revenue sharing/ embedded
brokerage
The canvas 1-5: Revenue
streams (2/2)
The canvas 1-5: Revenue
streams (2/2)
Freemium (software)
Advertising (search,
media)
Cross subsidies (mobile
op., razor & blades)op., razor & blades)
Zero marginal cost
(online music)
Labor exchange (yahoo
answers, …)
Gift economy
(Wikipedia)
What revenue streams?What revenue streams?
The canvas 1-6: Key activitiesThe canvas 1-6: Key activities
Operations & actions required to execute at
the best
Generate/sustain customer relationship
Deliver value proposition
Earn revenuesEarn revenues
Types
Production (incl. Supply, process, inventory mngt)
Development
Knowledge & problem solving (incl. R&D, IP)
Platform & network management
Relationships: stakeholders, Customer response & partnership
management
Check quality & environment impact
The canvas 1-6: key activities
the 3 core models
The canvas 1-6: key activities
the 3 core models
Platform Mngt Cust. Relationship Prod. innovation
Key Value
generator
Operational excellence Customer intimacy Product leadership
Economics Economy of scale, standards Economy of scope Speed (1st entrant)Economics Economy of scale, standards Economy of scope Speed (1st entrant)
Culture Network, IT, process,
Consolidate
Sales, Diversify R&D, Open for best
talents & skills
Focus Costs Service People
Examples Google, Amazon, Cisco,
airlines, Dell, cars
Redhat, SAP, IBM,
Nespresso
Apple, P&G,
What about Microsoft, Nokia, Facebook, Media, Telcos, Luxury goods
What key activities?What key activities?
The canvas 1-7: Key resourcesThe canvas 1-7: Key resources
internal external
Human & intellectual HR, R&D
communities &
network
stock exchange,
Financial EBIT
stock exchange,
equity holders,
banks
IT Information systems
web, cloud,
partners
facilities & assets
Processes, assembly
lines
outsourced,
partnered, subs
logistics Warehouses, fleet
Transport partners,
distributors
What key resources?What key resources?
The canvas 1-8: Key
partnerships
The canvas 1-8: Key
partnerships
Strategic Allies = focus on speed & risk
Global & long term
Balanced relationship
Increase customer value
Share risk, reduce cost (ex:R&D)
Third party in customer relationship
Business / channel partners = focus on market accessBusiness / channel partners = focus on market access
Regional and/or opportunistic
Increase customer value
Share risk, enhance customer intimacy
Third party in customer relationship
Innovation Ecosystem = focus on R&D
Global or Regional, specific
Share technological risk
Advanced technology providers
Technology has the potential to become global tech
Subcontractors= focus on production capacity & cost
No risk sharing
Not part of customer relationship
What key partnerships?What key partnerships?
The canvas 1-9: cost structuresThe canvas 1-9: cost structures
Economy of scale come when upstream components
(execution) can be shared between BM
Key activities
Key resources
Key partnershipsKey partnerships
Cost models
strategy consistency market efficiency
The canvas 1-9: cost structureThe canvas 1-9: cost structure
contribution
to value
Costs (F/V)
H-L strategic
H-H strategic
outsource
Key activities/ressources
high high
low low
L-L outsource
L-H change
outsource
Economies of scale (bulk purchase)
Economies of scope (mkg costs)
What could be their cost
structure?
What could be their cost
structure?
Summarize the canvasSummarize the canvas
Cust.
Seg.
value
prop cust. Rel channels
rev.
Streams key act. key res. key part.
cost
struct.
Nike
Apple
CitroënCitroën
Coca Cola
Facebook
Nintendo
EasyJet
Nespresso
agendaagenda
1. The BM canvas
2. The main BM patterns
3. Build your BM3. Build your BM
4. Evaluate your BM
5. Implement your BM
2-1 BM patterns: unbundle the models2-1 BM patterns: unbundle the models
Identify core models in current business
Check trade-offs in 9 building blocks
(constraints & conflicts = self limitation to
value delivered)value delivered)
Evaluate potential added value from
unbundling (revenues, costs, investments,
ebit)
Simulate unbundled models
Examples: Amazon, mobile operators,
private banking
2-2 BM patterns: multi-sided
platforms
2-2 BM patterns: multi-sided
platforms
1. Facilitate interactions between separate but interdependent customer
groups
2. Typical network effect (metcalf law)
3. Key success factors
1. A brand!
2. Scalable low cost platform
Customer
A
Customer
B
Value
gener.
Credit cards : consumers merchants
Media: eyeballs advertisers
Videogames players developpers
OS editors Users OEM service operators
LBS content providers
MVNO network operators
Customer
C
2-2 BM patterns: long tail2-2 BM patterns: long tail
% total demand
NETFLIX
DVD popularity
2-3 BM patterns: the long tail2-3 BM patterns: the long tail
http://www.thelongtail.com/the_long_tail/2007/10/are-facebook-ap.html
1. Theory
1. The natural shape of most markets is a powerlaw distribution (Pareto)= a
significant part of the market in the tail (25-50%)
2. If your market doesn't exhibit a powerlaw shape, you're probably doing
wrong in driving demand down the tail.
3. The best way to test whether a market is a powerlaw is to rank the items3. The best way to test whether a market is a powerlaw is to rank the items
in order of popularity and plot them on a log-log scale= straight line
2. Key success factors
1. Supply side factor: Inventory & distribution costs to zero
2. Demand side factor: traffic & networked recommendations
3. BM
1. Global niche players
2. Viral marketing & social networks, PPx
3. Massive multiple player platforms (games, e-training, education)
4. Micro-finance
5. User generated innovation & contents
4. Examples: Netflix/Glowria, Amazon, World of Warcraft, Facebook,
eBay, AdWords, Easyjet, Appstore…
2-3 BM patterns: Open2-3 BM patterns: Open
1. Open XXL: everything goes open (innovation IS open!)
2. Outside/in (participatory innovation)
a) P&G Connect & Develop + YourEncore
b) Challenges.gov http://challenge.gov/
c) Orange Labsc) Orange Labs
d) EcoImagination GE
e) Innoplace Solvay
3. Inside/out (ecosystem building)
a) GsK Patent Pooling
b) Google / Apple
c) Sony/ Nokia
a) Business cases
a) Innocentive
b) Planet Eureka
2-4 BM patterns: Loss leader2-4 BM patterns: Loss leader
1. attractive (free?) initial offer encourages further purchases of related
products & services
2. Key success factor
1. Controlled cost structure & delivery channels
2. Patent for lock-in
3. Brand
3. Examples3. Examples
1. Printers
2. Razor & blades
3. Mobile phones
4. Video game consoles
5. Free apps / mobile stores
2-BM Patterns: applying the core
models
2-BM Patterns: applying the core
models
Key feature Platform
Mngt
Cust.
Relationship
Prod.
innovation
Examples
Multi-
sided
platforms
Facilitate interactions
between customer
groups
Economy of scale
Critical Critical derived eBay, Apple,
videogames,
Google, Media
Long tail Sell less to more
Requires low
Critical critical derived Amazon
Requires low
inventory/distrib cost,
scalable platform
Economy of Scale
Free Subsidize, freemium,
Loss leader
non monetary
Cost based
Economy of scope
Optional Critical critical Google,
Metro,
Open Outside/in & inside/out
Networked
optional critical derived P&G, Orange
Labs
loss
leadership
Cost management
Patent control
optional critical critical HP, mobile
operators
What core models?What core models?
agendaagenda
1. The BM canvas
2. The main BM patterns
3. Build your BM3. Build your BM
4. Evaluate your BM
5. Implement your BM
industry
job
Issues segmentation
Build your BM (1): the
customer perspective
Build your BM (1): the
customer perspective
Business model
Solution(s)
expertise
organisation
53
CONTEXT
Build your BM (1): the
customer perspective
Build your BM (1): the
customer perspective
WAYS WANTS WISH
RELATIONS
CONTEXT
JOB DONE!
PAINS GAINS
TRANSACTION
RELATIONS
Build your BM(1): customer
perspective (Transaction)
Build your BM(1): customer
perspective (Transaction)
Jobs to be done
(issues)
Unsolved issues
Urgencies, second priorities
Major constraints (inside/outside) & risks
How do we help?
Pains
Key stakes per job to be done (objective)
Fears & frustrations (subjective)Pains Fears & frustrations (subjective)
obstacles
How do we help?
Gains
What the customer wants
Key benefits/targets
Key success factors
How do we help?
What is he ready to
pay for ?
What he is used to paying (budgets, models)
Other funding sources (already used) (internal/external)
Budget types (capex, opex, R&D)
Build your BM (1): customer
perspective (relations)
Build your BM (1): customer
perspective (relations)
The customer way
What he/she is used to – ready to try
What he wishes/ prefers
What he refuses
How do we fitHow do we fit
context
What he sees: environment, market, colleagues
What she hears: colleagues, boss, influencers, competitors
What he express: words, behaviours (public, private)
How the customer sees
the relationship?
Explicit/ formalised
Implicit /unformalised (suggested)
How do we cope
What customer perspective?What customer perspective?
Build your BM (2):
prototype your BM
Build your BM (2):
prototype your BM
R$C$
KA
KR
KP
CR
VP
CH
CS R$C$
KA
KR
KP
CR
VP
CH
CS
R$C$
KA
KR
KP
CR
VP
CH
CS R$C$
KA
KR
KP
CR
VP
CH
CS
Resource driven Customer driven
Cost driven Offer driven
Build your BM (2):
prototype your BM
Build your BM (2):
prototype your BM
Mock up/ prototype / industrialize
Brainstorm & Sketch out
Elaborate / canvas
Define business case
Field test (VP, CH, R$...)Field test (VP, CH, R$...)
Design/provoke/decide
BM coherence & clarity
BM sustainability
Optimize & go beyond comfort of first results
Build your BM (3): tell a storyBuild your BM (3): tell a story
Build your BM (3): tell a storyBuild your BM (3): tell a story
Articulate stories
Company perspective
Customer perspective
VisualizeVisualize
Sketches & Images, videos, strips
Role play
Make the future tangible
Challenge status quo (demonstrate pitfalls)
Create urgency (context & evolution)
Demonstrate benefits
Show the way (articulate change)
Build your BM (3): tell THIS storyBuild your BM (3): tell THIS story
2- Build
innovative BM
3 minutes!
1- list
characteristics
Choose segment
Tell the story
(play, draw,
write, sing…)
Have fun!
The silly cow BMThe silly cow BM
CR
Customer
relationship
KR
Key
Ressources
CS
Customer
segments
R$
Revenue
streams
C$
Cost
structure
VP
Value
proposition
CH
Channels
KA
Key Activities
KP
Key
Partnerships
Build your BM (3): Tell the storyBuild your BM (3): Tell the story
Build your BM (4):
build scenarios
Build your BM (4):
build scenarios
Identify key market drivers
Select two key ones (define Biz as Usual)
« what if?... »« what if?... »
Shape 4 scenarios, name them & tell the
story
Build BM for each scenario
Extract key info: thresholds, risk analysis,
cost & benefits
Building BM (4): scenariosBuilding BM (4): scenarios
Driver 1
R
$
C
$
KA
KR
CR
VP
C
S
R
$
C
$
KA
KR
CR
VP
C
S
Scenario 2
Scenario 4
Driver 2
$$
KR
KP
VP
CH
S $$
KR
KP
VP
CH
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
BUSINESS AS USUAL Scenario 3
Building BM (4):
the pharma industry scenarios
Building BM (4):
the pharma industry scenarios
R
$
C
$
KA
KR
CR
VP
C
S
R
$
C
$
KA
KR
CR
VP
C
S
The healthy
patient
Reinventing
pharmaScenario 2
Scenario 4
Prevention as main value generator
$$
KR
KP
VP
CH
S $$
KR
KP
VP
CH
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
BUSINESS AS USUAL
My medicine
Treatment as main value generator
Personal medicine
A fad
Personal medicine
mainstream
Building BM (4):
the telecom industry scenarios
Building BM (4):
the telecom industry scenarios
R
$
C
$
KA
KR
CR
VP
C
S
R
$
C
$
KA
KR
CR
VP
C
S
The BOX
model
The
MOBILE
GRID model
Scenario 2
Scenario 4
Device interconnection
A key driver
$$
KR
KP
VP
CH
S $$
KR
KP
VP
CH
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
BUSINESS AS USUAL
The WEB model
Infrastructure
as a key driver
Content (voice
messages/ data)
= main usage
Apps & services
= main usage
Building BM (4):
the XXX industry scenarios?
Building BM (4):
the XXX industry scenarios?
R
$
C
$
KA
KR
CR
VP
C
S
R
$
C
$
KA
KR
CR
VP
C
S
Scenario 2
Scenario 4
$$
KR
KP
VP
CH
S $$
KR
KP
VP
CH
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
R
$
C
$
KA
KR
KP
CR
VP
CH
C
S
BUSINESS AS USUAL
agendaagenda
1. The BM canvas
2. The main BM patterns
3. Build your BM3. Build your BM
4. Evaluate your BM resilience
5. Implement your BM
Evaluate your BM resilience
(1): environment impact
Evaluate your BM resilience
(1): environment impact
Identify Key trends
Regulation
Societal & culture
technologies
Identify potential changes in market forces
Segments evolution, Consumption patterns & demandSegments evolution, Consumption patterns & demand
Costs + Revenue models evolution & attractiveness
Identify potential changes in macro-economics
Cost of capital, currency gaps
Cost of goods
Economic downturn (regional/global)
Identify potential changes in industry forces
Porter 5 forces
Evaluate impact on 9 BM building blocks
Evaluate your BM resilience
(1): environment impact
Evaluate your BM resilience
(1): environment impact
+/- CS CR VP CH R$ KA KR KP C$
key trends
regulatory
societal
technos
changes in
segment evol.
consumpt patternschanges in
market forces
consumpt patterns
RM evol & attractiveness
IP/generic
changes in
macro-eco
capital/ currency
goods
eco. Downturns
changes in
industry
supply power
demand power
comp. Rivalry
new entrants
substitutes
What key changes?What key changes?
Evaluate your BM resilience
(2): building blocks SWOT
Evaluate your BM resilience
(2): building blocks SWOT
strength weakness opportunities threats
CS
VP
CRCR
CH
R$
KA
KR
KP
C$
What key building blocks SWOT?What key building blocks SWOT?
agendaagenda
1. The BM canvas
2. The main BM patterns
3. Build your BM3. Build your BM
4. Evaluate your BM
5. Implement your BM
Implement/optimise your BM
(1)
Implement/optimise your BM
(1)
CS CR VP CH R$ KA KR KP C$
EliminateEliminate
target/value/key steps
Reduce
Raise
Create
Implement/optimise your BM (2):
the BSC
Implement/optimise your BM (2):
the BSC
Goal Target Values Key steps
Ability to serve
goal target values Key steps
profit EBIT 15% Red. Ext.
costs
Portfolio
analysis
finances
Ability to grow
Goal Target Values Key steps
Ability to execute
Vision & strategy
Goal Target Values Key steps
Cust.
Intim.
Contract
duration
From 2
to 4 y.
Mkg
campaign
# visits From 2
to 4/ y
Capture
plan
Cust. & markets
Goal Target Values Key steps
Adapt
managt
.
Personal
versatility
15%
chged /y
Training,
incentive plan
Init. DD 4 /y ISO 16001
Change dynamics
Ability to learn
Goal Target Values Key steps
Service
quality
24/7 Within 2
y.
Distributed
prod
Key processes
Ability
to
compete
Useful litteratureUseful litterature
Business Model Generation
A. Osterwalder/ Y. Pigneur + 470 practitioners
7 Etapes pour un BM solide
Denis Dauchy
The Lean Start-up
Eric Ries
HBR on business model innovation

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Building business models

  • 1. Successful business model design Successful business model design With the BM Canvas A. Osterwalder & Y. Pigneur With the BM Canvas A. Osterwalder & Y. Pigneur
  • 2. agendaagenda 1. The BM canvas 2. The main BM patterns 3. Build your BM3. Build your BM 4. Evaluate your BM 5. Implement your BM
  • 3. agendaagenda 1. The BM canvas 2. The main BM patterns 3. Build your BM3. Build your BM 4. Evaluate your BM 5. Implement your BM
  • 4. What is a business modelWhat is a business model A coherent & effective business logic, specific to the company, time, environment A company specific way to create, deliver and share value It involves People with specific consumption & need patterns = customer segments People with skills within the company (ressources) and outside of the company (partners)= ressources Assets & processes = ressources Business specific revenue streams = revenue model
  • 5. Why is a BM necessary?Why is a BM necessary? It makes value generation explicit: Revenue streams Growth Value for stakeholdersValue for stakeholders Brings together context/values/people An explicit business logic helps maximise efficiency Critical to understand & optimise competitive position
  • 6. Key value driversKey value drivers
  • 8. 1-The canvas: traditional way1-The canvas: traditional way CR Customer relationship KA Key Activities Marketing Sales OperationsFinance CS Customer segments R$ Revenue streams C$ Cost structure VP Value proposition CH Channels KR Key Ressources KP Key Partnership s visionvisionexecutionexecution
  • 9. 1-The canvas: dynamic way1-The canvas: dynamic way CSCSR$C$ CR Customer relationship CR Customer relationship VP Value VP Value KA Key Activities KR share (depth & width) CS Customer segments CS Customer segments R$ Revenue streams C$ Cost structure Value proposition Value proposition CH Channels CH Channels KR Key Ressources KP Key Partnerships Co-create value executeexecute serveserve (depth & width)(depth & width) visionvisionexecutionexecution
  • 10. 1-The canvas: your turn!1-The canvas: your turn!
  • 11. The canvas 1-1: customer segments (theory) The canvas 1-1: customer segments (theory) Intrinsic criteria (usage & customer driven) Homogeneous & distinct Specific behaviours, expectations & needs Specific types of relationship & similar access to offering Extrinsic criteria (operation driven) Identifiable & Measurable (accurate data, time & resource consuming) Substantial (not too big, not too small): global niches vs mass market Operational: accessible/durable Examples of segments Demographics & user profiles, geographic Behaviorist: benefits sought, brand loyalty, usage/purchase behaviour, readiness to buy psychographic (activities, opinions, interests, attitudes, values…) Operating: techno, capabilities Purchasing functions & preferences (policies, criteria, …) Situational (urgency, applications, size of order…)
  • 12. The canvas 1-1: customer segmentsThe canvas 1-1: customer segments The golden rule A business model is specific to a customer segment
  • 13. The canvas 1-1: customer segments (practice 1/7) The canvas 1-1: customer segments (practice 1/7) The more mature the market, the more segments From mass marketing to target marketing From segments to individualization of needs Fashion : purchase pattern (ex: UK) Male: 15 types/5 groupsMale: 15 types/5 groups Female: 20 types/ 7 groups In depth analysis Demographics/ expenditures Purchases Typical shops attitudes
  • 14. The canvas 1-1: customer segments (practice 2/7) The canvas 1-1: customer segments (practice 2/7)
  • 15. The canvas 1-1: customer segments (practice 3/7) The canvas 1-1: customer segments (practice 3/7) Fashion : purchase pattern (ex: UK) mid range dressed in the best distinguished classicsprofessional lookquality not quantity functional fashion seeker 14 16 18 20 spend/item/20 conventional appearance mid range suitability selective habit mainstream fathers brand boy low cost long last Any shirt will do youthful aspiration budgetimage sporty basics 0 2 4 6 8 10 12 14 0 2 4 6 8 10 12 14 16 age/20
  • 16. The canvas 1-1: customer segments (practice 4/7) The canvas 1-1: customer segments (practice 4/7) Fashion : purchase pattern (ex: UK) distinguished classics dressed in the best 20 25 spend/item/20 Circle =% pop youthful aspiration Any shirt will do functional fashion seeker sporty basics budgetimage mainstream fathers professional look mid range suitability classics quality not quantity brand boy low cost long last conventional appearance selective habit 0 5 10 15 -2 0 2 4 6 8 10 12 14 16 18 age/20
  • 17. The canvas 1-1: customer segments (practice 5/7) The canvas 1-1: customer segments (practice 5/7) rank % male pop type spend 129 8,6 conventional appearance 15 108 7,2 mid range suitability 15 105,6 8,8 selective habit 12 104,5 5,5 dressed in the best 19 97,6 6,1 mainstream fathers 1697,6 6,1 mainstream fathers 16 97,5 7,5 brand boy 13 74,9 10,7 low cost long last 7 72 4 distinguished classics 18 71,4 4,2 professional look 17 61,6 7,7 quality not quantity 8 58,5 6,5 functional fashion seeker 9 55 5 Any shirt will do 11 50 5 youthful aspiration 10 40,8 6,8 budget image 6 31,5 6,3 sporty basics 5
  • 18. The canvas 1-1: customer segments (practice 6/7) The canvas 1-1: customer segments (practice 6/7) Fashion : purchase pattern (ex: UK) Circle =% pop 4- dressed in the best distinguished classicsprofessional look functional fashion seeker 20 25 spend/item/20 1- conventional appearance 2- mid range suitability 3- selective habit 5- mainstream fathers brand boy low cost long last quality not quantity functional fashion seeker Any shirt will do youthful aspiration budget image sporty basics 0 5 10 15 -2 0 2 4 6 8 10 12 14 16 18 age/20
  • 19. The canvas 1-1: customer segments (practice 7/7) The canvas 1-1: customer segments (practice 7/7) Other markets Nuclear plants: 3 to 4 segments Automotive: 9 segments # A segment-mini # B segment-small # C segment-lower-medium # D segment-upper-medium# D segment-upper-medium # E segment-executive # F segment-luxury # G segment-sports # H segment-dual-purpose # I segment-multi-purpose vehicle (MPV) Mobile phones Cosmetics? Real estate? Beverages? IT?
  • 20. What are the targetted customer segments What are the targetted customer segments
  • 21. The canvas 1-2: value proposition The canvas 1-2: value proposition Economic equation between customer/ distributor & company The reason to be preferred… now and (everlasting) later The job to be done (material/immaterial) User perceived value, made ofUser perceived value, made of Products (I provide you with ) Service (I do for you) Relationship (we do/are together) User generated value Includes: performance, quality, price, Design, status Convenience, accessibility, Risk reduction
  • 22. The canvas 1-2: value proposition The canvas 1-2: value proposition segment 1 segment 2 Segment 3 advantages 2000 compatibility 300 transparency 100 internal cost (direct/indirect) 200 risk 100 transfert costs 200 UVPC g-p 1900 0 0 A GENUINE VALUE PROPOSITION is an economic equation on how to share the value created figures in 000 Usage Value Perceived by customer gain pain UVPC g-p 1900 0 0 price 1000 Maintenance 100 Evolution 100 Training 100 exchange value 1 300 - - margin 500 0 0 cost 600 investments 1000 # years 5 amortized investments 200 - - total costs 800 - - VALUE PROPOSITION UVPC-costs 1100 0 0 customer 500 0 0 % commission 10% distributors 100 0 0 company (margin) 500 0 0 value shared exchange value production
  • 23. What value propositions?What value propositions?
  • 24. The canvas 1-3: channelsThe canvas 1-3: channels sell in effort sell out effort cost brand efficiency delivery efficiency level of service required value added to customer(% portfolio) (% of life) own direct sales force web own direct web own store partner indirect 1/3 p stores wholesaler reseller affiliation customer network mkg
  • 25. The canvas 1-3: channelsThe canvas 1-3: channels sell in effort sell out effort cost brand efficiency delivery efficiency level of service required value added to customer (% portfolio) (% of life) own direct sales force N-A high high high high high high web high low low medium medium low medium own direct web high low low medium medium low medium own store N-A medium high high high high medium partner indirect 1/3 p stores high medium medium medium high high medium? wholesaler low medium low low medium medium low reseller medium medium low low medium medium medium? affiliation high low low low low low low customer network mkg high low low high low low high?
  • 26. What access channels?What access channels?
  • 27. The canvas 1-4: Customer relationships The canvas 1-4: Customer relationships Deliver (transaction) + exchange (relation)= build trust Customer acquisition vs retention Customer intimacy & upsell (one to one)Customer intimacy & upsell (one to one) From short to long term The tools CRM (level 0) Customer assistance & survey (level 1) Training, user conferences (level 2) Network & communities of practice (level 3) Co-creation & supply chain (level 4)
  • 28. What kind of customer relationship? What kind of customer relationship?
  • 29. The canvas 1-5: Revenue streams (1/2) The canvas 1-5: Revenue streams (1/2) fixed (static variables) dynamic (market conditions) Price list yield management (airlines, hotels) direct feature dependent real time market licence/ subscription auctions usage (ppu) Future value renting/leasing indirect subsidised sales (advertising) free revenue sharing/ embedded brokerage
  • 30. The canvas 1-5: Revenue streams (2/2) The canvas 1-5: Revenue streams (2/2) Freemium (software) Advertising (search, media) Cross subsidies (mobile op., razor & blades)op., razor & blades) Zero marginal cost (online music) Labor exchange (yahoo answers, …) Gift economy (Wikipedia)
  • 31. What revenue streams?What revenue streams?
  • 32. The canvas 1-6: Key activitiesThe canvas 1-6: Key activities Operations & actions required to execute at the best Generate/sustain customer relationship Deliver value proposition Earn revenuesEarn revenues Types Production (incl. Supply, process, inventory mngt) Development Knowledge & problem solving (incl. R&D, IP) Platform & network management Relationships: stakeholders, Customer response & partnership management Check quality & environment impact
  • 33. The canvas 1-6: key activities the 3 core models The canvas 1-6: key activities the 3 core models Platform Mngt Cust. Relationship Prod. innovation Key Value generator Operational excellence Customer intimacy Product leadership Economics Economy of scale, standards Economy of scope Speed (1st entrant)Economics Economy of scale, standards Economy of scope Speed (1st entrant) Culture Network, IT, process, Consolidate Sales, Diversify R&D, Open for best talents & skills Focus Costs Service People Examples Google, Amazon, Cisco, airlines, Dell, cars Redhat, SAP, IBM, Nespresso Apple, P&G, What about Microsoft, Nokia, Facebook, Media, Telcos, Luxury goods
  • 34. What key activities?What key activities?
  • 35. The canvas 1-7: Key resourcesThe canvas 1-7: Key resources internal external Human & intellectual HR, R&D communities & network stock exchange, Financial EBIT stock exchange, equity holders, banks IT Information systems web, cloud, partners facilities & assets Processes, assembly lines outsourced, partnered, subs logistics Warehouses, fleet Transport partners, distributors
  • 36. What key resources?What key resources?
  • 37. The canvas 1-8: Key partnerships The canvas 1-8: Key partnerships Strategic Allies = focus on speed & risk Global & long term Balanced relationship Increase customer value Share risk, reduce cost (ex:R&D) Third party in customer relationship Business / channel partners = focus on market accessBusiness / channel partners = focus on market access Regional and/or opportunistic Increase customer value Share risk, enhance customer intimacy Third party in customer relationship Innovation Ecosystem = focus on R&D Global or Regional, specific Share technological risk Advanced technology providers Technology has the potential to become global tech Subcontractors= focus on production capacity & cost No risk sharing Not part of customer relationship
  • 38. What key partnerships?What key partnerships?
  • 39. The canvas 1-9: cost structuresThe canvas 1-9: cost structures Economy of scale come when upstream components (execution) can be shared between BM Key activities Key resources Key partnershipsKey partnerships Cost models strategy consistency market efficiency
  • 40. The canvas 1-9: cost structureThe canvas 1-9: cost structure contribution to value Costs (F/V) H-L strategic H-H strategic outsource Key activities/ressources high high low low L-L outsource L-H change outsource Economies of scale (bulk purchase) Economies of scope (mkg costs)
  • 41. What could be their cost structure? What could be their cost structure?
  • 42. Summarize the canvasSummarize the canvas Cust. Seg. value prop cust. Rel channels rev. Streams key act. key res. key part. cost struct. Nike Apple CitroënCitroën Coca Cola Facebook Nintendo EasyJet Nespresso
  • 43. agendaagenda 1. The BM canvas 2. The main BM patterns 3. Build your BM3. Build your BM 4. Evaluate your BM 5. Implement your BM
  • 44. 2-1 BM patterns: unbundle the models2-1 BM patterns: unbundle the models Identify core models in current business Check trade-offs in 9 building blocks (constraints & conflicts = self limitation to value delivered)value delivered) Evaluate potential added value from unbundling (revenues, costs, investments, ebit) Simulate unbundled models Examples: Amazon, mobile operators, private banking
  • 45. 2-2 BM patterns: multi-sided platforms 2-2 BM patterns: multi-sided platforms 1. Facilitate interactions between separate but interdependent customer groups 2. Typical network effect (metcalf law) 3. Key success factors 1. A brand! 2. Scalable low cost platform Customer A Customer B Value gener. Credit cards : consumers merchants Media: eyeballs advertisers Videogames players developpers OS editors Users OEM service operators LBS content providers MVNO network operators Customer C
  • 46. 2-2 BM patterns: long tail2-2 BM patterns: long tail % total demand NETFLIX DVD popularity
  • 47. 2-3 BM patterns: the long tail2-3 BM patterns: the long tail http://www.thelongtail.com/the_long_tail/2007/10/are-facebook-ap.html 1. Theory 1. The natural shape of most markets is a powerlaw distribution (Pareto)= a significant part of the market in the tail (25-50%) 2. If your market doesn't exhibit a powerlaw shape, you're probably doing wrong in driving demand down the tail. 3. The best way to test whether a market is a powerlaw is to rank the items3. The best way to test whether a market is a powerlaw is to rank the items in order of popularity and plot them on a log-log scale= straight line 2. Key success factors 1. Supply side factor: Inventory & distribution costs to zero 2. Demand side factor: traffic & networked recommendations 3. BM 1. Global niche players 2. Viral marketing & social networks, PPx 3. Massive multiple player platforms (games, e-training, education) 4. Micro-finance 5. User generated innovation & contents 4. Examples: Netflix/Glowria, Amazon, World of Warcraft, Facebook, eBay, AdWords, Easyjet, Appstore…
  • 48. 2-3 BM patterns: Open2-3 BM patterns: Open 1. Open XXL: everything goes open (innovation IS open!) 2. Outside/in (participatory innovation) a) P&G Connect & Develop + YourEncore b) Challenges.gov http://challenge.gov/ c) Orange Labsc) Orange Labs d) EcoImagination GE e) Innoplace Solvay 3. Inside/out (ecosystem building) a) GsK Patent Pooling b) Google / Apple c) Sony/ Nokia a) Business cases a) Innocentive b) Planet Eureka
  • 49. 2-4 BM patterns: Loss leader2-4 BM patterns: Loss leader 1. attractive (free?) initial offer encourages further purchases of related products & services 2. Key success factor 1. Controlled cost structure & delivery channels 2. Patent for lock-in 3. Brand 3. Examples3. Examples 1. Printers 2. Razor & blades 3. Mobile phones 4. Video game consoles 5. Free apps / mobile stores
  • 50. 2-BM Patterns: applying the core models 2-BM Patterns: applying the core models Key feature Platform Mngt Cust. Relationship Prod. innovation Examples Multi- sided platforms Facilitate interactions between customer groups Economy of scale Critical Critical derived eBay, Apple, videogames, Google, Media Long tail Sell less to more Requires low Critical critical derived Amazon Requires low inventory/distrib cost, scalable platform Economy of Scale Free Subsidize, freemium, Loss leader non monetary Cost based Economy of scope Optional Critical critical Google, Metro, Open Outside/in & inside/out Networked optional critical derived P&G, Orange Labs loss leadership Cost management Patent control optional critical critical HP, mobile operators
  • 51. What core models?What core models?
  • 52. agendaagenda 1. The BM canvas 2. The main BM patterns 3. Build your BM3. Build your BM 4. Evaluate your BM 5. Implement your BM
  • 53. industry job Issues segmentation Build your BM (1): the customer perspective Build your BM (1): the customer perspective Business model Solution(s) expertise organisation 53
  • 54. CONTEXT Build your BM (1): the customer perspective Build your BM (1): the customer perspective WAYS WANTS WISH RELATIONS CONTEXT JOB DONE! PAINS GAINS TRANSACTION RELATIONS
  • 55. Build your BM(1): customer perspective (Transaction) Build your BM(1): customer perspective (Transaction) Jobs to be done (issues) Unsolved issues Urgencies, second priorities Major constraints (inside/outside) & risks How do we help? Pains Key stakes per job to be done (objective) Fears & frustrations (subjective)Pains Fears & frustrations (subjective) obstacles How do we help? Gains What the customer wants Key benefits/targets Key success factors How do we help? What is he ready to pay for ? What he is used to paying (budgets, models) Other funding sources (already used) (internal/external) Budget types (capex, opex, R&D)
  • 56. Build your BM (1): customer perspective (relations) Build your BM (1): customer perspective (relations) The customer way What he/she is used to – ready to try What he wishes/ prefers What he refuses How do we fitHow do we fit context What he sees: environment, market, colleagues What she hears: colleagues, boss, influencers, competitors What he express: words, behaviours (public, private) How the customer sees the relationship? Explicit/ formalised Implicit /unformalised (suggested) How do we cope
  • 57. What customer perspective?What customer perspective?
  • 58. Build your BM (2): prototype your BM Build your BM (2): prototype your BM R$C$ KA KR KP CR VP CH CS R$C$ KA KR KP CR VP CH CS R$C$ KA KR KP CR VP CH CS R$C$ KA KR KP CR VP CH CS Resource driven Customer driven Cost driven Offer driven
  • 59. Build your BM (2): prototype your BM Build your BM (2): prototype your BM Mock up/ prototype / industrialize Brainstorm & Sketch out Elaborate / canvas Define business case Field test (VP, CH, R$...)Field test (VP, CH, R$...) Design/provoke/decide BM coherence & clarity BM sustainability Optimize & go beyond comfort of first results
  • 60. Build your BM (3): tell a storyBuild your BM (3): tell a story
  • 61. Build your BM (3): tell a storyBuild your BM (3): tell a story Articulate stories Company perspective Customer perspective VisualizeVisualize Sketches & Images, videos, strips Role play Make the future tangible Challenge status quo (demonstrate pitfalls) Create urgency (context & evolution) Demonstrate benefits Show the way (articulate change)
  • 62. Build your BM (3): tell THIS storyBuild your BM (3): tell THIS story 2- Build innovative BM 3 minutes! 1- list characteristics Choose segment Tell the story (play, draw, write, sing…) Have fun!
  • 63. The silly cow BMThe silly cow BM CR Customer relationship KR Key Ressources CS Customer segments R$ Revenue streams C$ Cost structure VP Value proposition CH Channels KA Key Activities KP Key Partnerships
  • 64. Build your BM (3): Tell the storyBuild your BM (3): Tell the story
  • 65. Build your BM (4): build scenarios Build your BM (4): build scenarios Identify key market drivers Select two key ones (define Biz as Usual) « what if?... »« what if?... » Shape 4 scenarios, name them & tell the story Build BM for each scenario Extract key info: thresholds, risk analysis, cost & benefits
  • 66. Building BM (4): scenariosBuilding BM (4): scenarios Driver 1 R $ C $ KA KR CR VP C S R $ C $ KA KR CR VP C S Scenario 2 Scenario 4 Driver 2 $$ KR KP VP CH S $$ KR KP VP CH S R $ C $ KA KR KP CR VP CH C S R $ C $ KA KR KP CR VP CH C S BUSINESS AS USUAL Scenario 3
  • 67. Building BM (4): the pharma industry scenarios Building BM (4): the pharma industry scenarios R $ C $ KA KR CR VP C S R $ C $ KA KR CR VP C S The healthy patient Reinventing pharmaScenario 2 Scenario 4 Prevention as main value generator $$ KR KP VP CH S $$ KR KP VP CH S R $ C $ KA KR KP CR VP CH C S R $ C $ KA KR KP CR VP CH C S BUSINESS AS USUAL My medicine Treatment as main value generator Personal medicine A fad Personal medicine mainstream
  • 68. Building BM (4): the telecom industry scenarios Building BM (4): the telecom industry scenarios R $ C $ KA KR CR VP C S R $ C $ KA KR CR VP C S The BOX model The MOBILE GRID model Scenario 2 Scenario 4 Device interconnection A key driver $$ KR KP VP CH S $$ KR KP VP CH S R $ C $ KA KR KP CR VP CH C S R $ C $ KA KR KP CR VP CH C S BUSINESS AS USUAL The WEB model Infrastructure as a key driver Content (voice messages/ data) = main usage Apps & services = main usage
  • 69. Building BM (4): the XXX industry scenarios? Building BM (4): the XXX industry scenarios? R $ C $ KA KR CR VP C S R $ C $ KA KR CR VP C S Scenario 2 Scenario 4 $$ KR KP VP CH S $$ KR KP VP CH S R $ C $ KA KR KP CR VP CH C S R $ C $ KA KR KP CR VP CH C S BUSINESS AS USUAL
  • 70. agendaagenda 1. The BM canvas 2. The main BM patterns 3. Build your BM3. Build your BM 4. Evaluate your BM resilience 5. Implement your BM
  • 71. Evaluate your BM resilience (1): environment impact Evaluate your BM resilience (1): environment impact Identify Key trends Regulation Societal & culture technologies Identify potential changes in market forces Segments evolution, Consumption patterns & demandSegments evolution, Consumption patterns & demand Costs + Revenue models evolution & attractiveness Identify potential changes in macro-economics Cost of capital, currency gaps Cost of goods Economic downturn (regional/global) Identify potential changes in industry forces Porter 5 forces Evaluate impact on 9 BM building blocks
  • 72. Evaluate your BM resilience (1): environment impact Evaluate your BM resilience (1): environment impact +/- CS CR VP CH R$ KA KR KP C$ key trends regulatory societal technos changes in segment evol. consumpt patternschanges in market forces consumpt patterns RM evol & attractiveness IP/generic changes in macro-eco capital/ currency goods eco. Downturns changes in industry supply power demand power comp. Rivalry new entrants substitutes
  • 73. What key changes?What key changes?
  • 74. Evaluate your BM resilience (2): building blocks SWOT Evaluate your BM resilience (2): building blocks SWOT strength weakness opportunities threats CS VP CRCR CH R$ KA KR KP C$
  • 75. What key building blocks SWOT?What key building blocks SWOT?
  • 76. agendaagenda 1. The BM canvas 2. The main BM patterns 3. Build your BM3. Build your BM 4. Evaluate your BM 5. Implement your BM
  • 77. Implement/optimise your BM (1) Implement/optimise your BM (1) CS CR VP CH R$ KA KR KP C$ EliminateEliminate target/value/key steps Reduce Raise Create
  • 78. Implement/optimise your BM (2): the BSC Implement/optimise your BM (2): the BSC Goal Target Values Key steps Ability to serve goal target values Key steps profit EBIT 15% Red. Ext. costs Portfolio analysis finances Ability to grow Goal Target Values Key steps Ability to execute Vision & strategy Goal Target Values Key steps Cust. Intim. Contract duration From 2 to 4 y. Mkg campaign # visits From 2 to 4/ y Capture plan Cust. & markets Goal Target Values Key steps Adapt managt . Personal versatility 15% chged /y Training, incentive plan Init. DD 4 /y ISO 16001 Change dynamics Ability to learn Goal Target Values Key steps Service quality 24/7 Within 2 y. Distributed prod Key processes Ability to compete
  • 79. Useful litteratureUseful litterature Business Model Generation A. Osterwalder/ Y. Pigneur + 470 practitioners 7 Etapes pour un BM solide Denis Dauchy The Lean Start-up Eric Ries HBR on business model innovation