1.
Webinar: Business Models 1
DEVELOPING NEW BUSINESS MODELS
19 APRIL 2018
B U S I N E S S M O D E L T R A N S F O R M A T I O N

2.
Webinar: Business Models 2
W H A T W E D O
We partner with leaders in corporate and government organisations
to design and execute new innovation strategies, services and products
through the customer or stakeholder lens.
We bring together the best of Design Thinking, Lean Startup, Corporate
Strategy and Customer Centric approaches to co-create experiences
that will delight your customer.

3.
Webinar: Business Models 33
DR JEFFREY TOBIAS
MANAGING DIRECTOR, THE STRATEGY GROUP
AGSM FELLOW
• Innovation thought-leader and entrepreneurship strategist
• Expertise from academic, entrepreneurial and corporate worlds
• Active angel investor on the board of various well known startups
• Professor of innovation and entrepreneurship teaching MBA students at the
Australian Graduate School of Business at the University of New South Wales
• Conducted numerous engagements with government departments and
commercial businesses on the principles of Design Thinking other stakeholder-
centric methodologies
• Trained over 1,000 senior executives in Westpac on Design Thinking and Lean
Startup.
• Previously Cisco’s Global Lead for Innovation in the Internet Business
Solutions Group helping Fortune Global 500 companies improve customer
experience and grow revenue by transforming how they do business.
• Focus: Innovation, Business model transformation, Design Thinking, Lean
Startup, Customer centricity, Leadership
M: +61 401 890 071
T: +61 2 9388 9925
jeffrey@thestrategygroup.com.au
www.thestrategygroup.com.au
Suite 606a, 3 Waverley Street,
Bondi Junction 2022
NSW Australia
Qualifications
Bachelor of Science (first-class
Honours; University Medal), UNSW
PhD, UNSW

4.
Webinar: Business Models 44
T HE ST R AT EGY GR OUP
O U R U N I Q U E VA L U E P R O P O S I T I O N
We offer a unique combination of global leading methodologies
and skills by operating at the intersection of innovation,
entrepreneurship and academia.

5.
Webinar: Business Models 55
OUR CLIENTS

6.
Webinar: Business Models 66
AGENDA
1. The changing landscape
2. Business model lifecycle
3. Introducing business model transformation
4. Frameworks for business models
5. Validating your new business model
6. Examples
7. Impact on people and leadership

7.
Webinar: Business Models 7
THE CHANGING LANDSCAPE
01

8.
What got us here,
won’t get us there.

9.
Webinar: Business Models 99
IMAGINE YOUR THINKING IN 2007
…if you were in
one of these
businesses…

10.
Webinar: Business Models 1010
SHOULD AUSTRALIA WORRY ABOUT
AMAZON?
USA
Changing Retailer Market
(Data 2016)

11.
Webinar: Business Models 1111
SOME ORGANISATIONS ARE ABLE TO
TRANSFORM
But what about now …
2017?

12.
Webinar: Business Models 1212
FORCES ARE RESHAPING OUR WORLD
> Exponential technology progress –
automation, big data, and robotics
> New consumers (emerging
economies)
> Global competition
> Disruption . . .
> Value shifting from products to
experience (in many arenas)
> Product/market power, scale, and
legacy positions are NO LONGER
SECURE guarantees of future success
> Creative capability is a critical resource

13.
Webinar: Business Models 13
BUSINESS MODEL LIFECYCLE
02

14.
Webinar: Business Models 1414

15.
Webinar: Business Models 1515
Source: Upfront Ventures @cbinsights
COST TO LAUNCH A TECH STARTUP

16.
Webinar: Business Models 1616
ORGANISATIONAL LIFECYCLE
Maturity
Why does it exist?
DANGER

17.
Webinar: Business Models 17
INTRODUCING BUSINESS MODEL
TRANSFORMATION
03

18.
Webinar: Business Models 1818
THE BIG QUESTIONS
How can an organisation deal with rapid
change and uncertainty in their environments?
How can an organisation generate, evaluate,
and implement a sensible new business model?
What can an organisation do to protect itself
from possible disadvantageous changes in its
external environment at point B rather than
experiencing performance problems at point A?
Transforming the Business
Model and the Organisation . . .
Performance
Time
B
A

19.
Webinar: Business Models 1919
HYPOTHESIS
This life cycle
decline, for an
organisation, is not
inevitable!
Great leaders jump
their organisations to
a new life-cycle curve
– frequently a new
business model.

20.
Webinar: Business Models 2020
PERHAPS WE LIVE IN A ERA OF
“ALWAYS-ON TRANSFORMATION”
Source: BCG 2015 A Leader’s Guide to Always-On Transformation. Hemerling, J, Dosik, D, and Rizvi, S.
DELIVER
LAUNCH
SUSTAIN
DELIVER
LAUNCH
SUSTAIN
DELIVER
LAUNCH
SUSTAIN

21.
Webinar: Business Models 2121
BUSINESS MODEL PATTERN
Razor and Blade
The basic product is cheap, or given away free.
The consumables that are needed to use or operate it, on the other hand, are expensive

22.
Webinar: Business Models 2222
BUSINESS MODEL PATTERN
Freemium
The basic version of an offering is given away for free in the hope of eventually persuading
the customers to pay for the premium version.

23.
Webinar: Business Models 2323
BUSINESS MODEL PATTERN
Peer to Peer
The model is based on a cooperation that specialises in mediating between individuals
belonging to an homogeneous group. It is often abbreviated as P2P.

24.
Webinar: Business Models 2424
BUSINESS MODEL PATTERN
Subscription
The customer pays a regular fee, typically on a monthly or an annual basis, in order to gain
access to a product or service.

25.
Webinar: Business Models 2525
BUSINESS MODEL PATTERN
Subscription
The customer pays a regular fee, typically on a monthly or an annual basis, in order to gain
access to a product or service.

26.
Webinar: Business Models 2626
BUSINESS MODEL PATTERN
Traditional Business Model
Movie Ticket Purchase
New Business Model
Movie Pass

27.
Webinar: Business Models 2727
BUSINESS MODEL PATTERN
Presales
Mercedes
Traditional: Build – Market - Sell
Tesla
New Business Model: Market – Sell – Build
Image: Tesla.comImage: MercedesBenz.com

28.
Webinar: Business Models 2828
TESLA: MARKET – SELL – BUILD
On May 27th, 2016, Tesla opened pre-orders for their Model 3, and within 24 hours,
more than 200,000 customers had paid deposits to reserve their place in line —
without the physical product existing. Tesla’s cost of advertising was only $6 per
car — less than 1/90th of the ad cost of their closest price-range competitor.
Image: Tesla.com

29.
Webinar: Business Models 29
FRAMEWORKS FOR BUSINESS MODELS
04

30.
Webinar: Business Models 3030
NINE BOX BUSINESS MODEL FRAMEWORK
Key Partners
• Who are our Key
Partners?
• Who are our key
suppliers?
• Which Key
Resources are we
acquiring from
partners?
• Which Key Activities
do partners
perform?
Key Activities
• What Key Activities do
our Value Propositions
require?
• Geographies?
• Client Relationships?
• Revenue streams?
Key Resources
• What Key Resources do
our Value Propositions
require?
• Our distribution
channels? Customer
Relationships?
• Revenue Streams?
Customer Relationships
• What type of relationship does each of
our customer segments expect us to
establish and maintain with them?
• Which ones have we established?
• How are they integrated with the rest of
our business model?
• How costly are they?
Channels
• Through which channels do our
customer segments want to be reached?
• How are we reaching them now?
• How are our Channels integrated?
• Which ones work best?
• Which ones are most cost-efficient?
• How are we integrating them with
customer routines?
Value Propositions
• What value do we deliver to the
customer?
• Which one of our customer’s problems
are we helping to solve?
• What bundles of services are we
offering to each customer segment?
• Which customer needs are we
satisfying?
Characteristics
• Newness
• Performance
• Customization
• Getting the Job Done
• Brand/Status
• Price
• Cost Reduction
• Risk Reduction
• Accessibility
• Convenience/Usability
Customer
Segments
• For whom are we
creating value?
• Who are our most
important customers?
Cost
Structure
• What are the most important costs inherent
in our business model?
• Which Key Resources are most expensive?
• Which Key Activities are most expensive?
Revenue
Streams
• For what value are customers really
willing to pay?
• For what do they currently pay?
• How are they currently paying?
• How would they prefer to pay?
• How much does each revenue
stream contribute to overall
revenues?

31.
Webinar: Business Models 3131
AMAZON’S BUSINESS
MODEL CANVAS

32.
Webinar: Business Models 32
VALIDATING YOUR NEW BUSINESS MODEL
05

33.
Webinar: Business Models 3333
FROM IDEA TO EXECUTION
Search Execution

34.
Webinar: Business Models 3535
?
?
?
? ?
?
?
?
?
POPULATED MODEL
IS A BUNCH OF HYPOTHESES
Source: Strategyzer.com

35.
Webinar: Business Models 3636
DESIRABILITYFEASIBILITY
VIABILITY
THREE LENSES
Source: Strategyzer.com

36.
Webinar: Business Models 3737
THE BUSINESS MODEL CANVAS
FEASIBILITY
Can we build it?
VIABILITY
Sanity check
DESIRABILITY
Do they want it?
Source: Strategyzer.com

37.
Webinar: Business Models 3838
THE BUSINESS MODEL CANVAS
EXECUTION
RISK
FINANCIAL
OPPORTUNITY & RISK
MARKET
OPPORTUNITY & RISK
Source: Strategyzer.com

38.
Webinar: Business Models 3939
BUILD AN EXPERIMENT LIBRARY
Strong evidence
Long time to set
up and conduct
experiment
short time to set
up and conduct
experiment
Weak evidence
The stronger your evidence,
the stronger your confidence level.

39.
Webinar: Business Models 4040
THE PROGRESS BOARD
BUSINESS
HYPOTHESIS
TEST:
backlog
TEST:
build
TEST:
measure
TEST:
learn
PROGRESS
✗
invalidated
?
unclear results
✓
validated
http://blog.strategyzer.com/posts/2015/3/11/lean-startup-progress-board

40.
Webinar: Business Models 41
EXAMPLE
06

41.
Webinar: Business Models 42
REWARDS
Shopper Reward
System
Sport Activities
in the Mall
Drop-off Play Zones
for Kids
SCENTRE GROUP INITIATIVE

42.
Webinar: Business Models 4343
IN SUMMARY
1. Most organisations need new business models to
combat disruption
2. The Business Model Canvas is an excellent way of
describing a business model
3. Business models need to be desirable, feasible and
viable
4. By conducting simple, low-fidelity experiments
starting with desirability, the new business model
can be significantly de-risked
5. The Progress Board enables you to keep track of
these experiments

43.
Presentation: ???
T H A N K Y O U
KEEP IN TOUCH
Dr Jeffrey Tobias, Managing Director
jeffrey@thestrategygroup.com.au
0401 890 071
www.thestrategygroup.com.au