Successfully reported this slideshow.
Your SlideShare is downloading. ×

Scoring a business model scoring using the Business Model Whee (TM)

Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Ad
Loading in …3
×

Check these out next

1 of 25 Ad
Advertisement

More Related Content

Slideshows for you (20)

Similar to Scoring a business model scoring using the Business Model Whee (TM) (20)

Advertisement
Advertisement

Scoring a business model scoring using the Business Model Whee (TM)

  1. 1. 1 Using the Business Model Wheel ™
  2. 2. 2 Key concepts There are three broad aspects of every business model – the offering, monetization, and sustainability
  3. 3. 3
  4. 4. 4
  5. 5. 5 Key concepts The Business Model Wheel ™ breaks down these aspects into more detailed categories for analysis
  6. 6. 6 Using the Wheel to Analyze a Business Model © Business Model Institute 2013
  7. 7. Business Model Scoring example using online music service
  8. 8. 8 Step 1: Analyze Factors for Each Section © Business Model Institute 2013
  9. 9. 9 Note: There are hundreds of potential factors. These are just a few examples. © Business Model Institute 2013
  10. 10. 10 Factors • How large is the market? • Is the overall market growing? • Is the market expected to grow within the next 3-5 years? • What are the typical margins within your industry? • Are customers in this niche overly price sensitive? • What is the general economic health of your customers? • Are there any threats of any substitute products/services?
  11. 11. 11 Factors • What makes your offering unique and different? • What value does your product deliver? • Do you have a valid “Blue Ocean” strategy or “Red Ocean” strategy? • Are your products/services priced dramatically differently than the existing market? • How powerful and differentiated is your value proposition?
  12. 12. 12 Step 2: Score Each Section © Business Model Institute 2013
  13. 13. 13 Comments & Scoring • Great marketing niche • Growing • Attractive customers • High tech unique offer • Superior delivery system • More user control 16 14 30
  14. 14. 14 Step 3: Rinse & Repeat © Business Model Institute 2013
  15. 15. 15 Factors • Does the sale of the product make significant profits or are add-on sales required? • Do you have a limited profit margin due to the competitive nature of the market? • Is your revenue recurring or one- time hits? • Do you have a competitive cost advantage? • How do your margins compare to your competitors’? • Are any of your revenue streams proprietary?
  16. 16. 16 Factors • Is the product marketed or does it have to be sold? • Can a salesperson of ordinary skill sell your offerings? • Do you have a sales pipeline model that can accurately predict future sales? • How does the cost of customer acquisition compare to the lifetime margin generated?
  17. 17. 17 Comments & Scoring • Proven sales model • Magnetic marketing • Exceptional margins • Significant upsell possibilities • Better margin than competition • Margin protection 1115 26
  18. 18. 18 Factors • Does your product/service have competitive advantage based on differentiation or focus? • How significant is the value and quality of your intellectual property? • Are there any existing threats from substitute products in your market industry? If so, how significant are they? • Do you have a low break-even point? • Do you have a meaningful cost advantage? • Are there financial barriers that help or hurt you? • Are there opportunities to grow or modify your value chain? • Will you be able to maintain or grow your competitive advantage?
  19. 19. 19 Factors • If you fail to innovate fast enough, how severe are the consequences? • How much do you need to innovate to keep pace? • How well do your competitors innovate? • In this industry, how significant is the competitive advantage gained by successful innovation? • How much of an advantage or disadvantage is this combination of need for innovation and ability to innovate?
  20. 20. 20 Factors • Does the negative impact of a pitfall kill the business? • Are there any potential future threats from changing demographics, consumer behavior changes, and other trends? • Is your business prone to potential government or regulatory policy changes? • Is your business overly reliant on trends, fashion, or whims? • Is your overall business vulnerable to litigation or legal pitfalls? • Is a large competitor entering your market a possibility?
  21. 21. 21 Factors • Will you be able to sell your business for enough money so you would never need to work again if you choose? • Is the business over dependent on a few customers? • How reliant is sales success on owners’ involvement? • What happens if you immediately had to stop working in the business? • How many key partner, vendor, and customer relationships are dependent upon the owners?
  22. 22. 22 Comments & Scoring • Solid current competitive advantage • Advantage should continue • Solid moats of protection • No significant threats • Strong innovation culture • Consistently out-innovate competitors • Patent protection • Weak competitive innovation • Product somewhat faddish • Consumer whims favor us now • Other similar offerings have lost favor • Technological obsolescence an issue • Exit plan – go public • Strong management team • Excellent income 8 24 8 2 6
  23. 23. 23 Step 4: Total the Scores © Business Model Institute 2013
  24. 24. 24 Final Score 8 26 8 2 6 16 14 11 15 3024 80
  25. 25. 25 Download the Business Model Wheel ™ at businessmodelwheel.com

×