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Extended Business Model Canvas (OOP 2021)

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Extended Business Model Canvas (OOP 2021)

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The Extended Business Model Canvas (EBMC) links Lean Portfolio Management, System Thinking, Lean Product development, and agile development in a way suitable for established enterprises, not just startups.
Two additional components, the "Contribution to Strategy" and "Technical Debt," apply now to operational and development values. Those components are supported by two special lenses that help agile teams to connect better, align, and achieve more business agility.

The Business Model Canvas (BMC) developed by Osterwalder and Pigneur explains "how value is created, delivered and captured from an organizational perspective." The BMC excels through the addition of the simple yet effective Value Proposition Canvas (VPC). The BMC combined with the VPC unfolds the driving powers and key pivot points along the operational value stream. It is a valuable Business Agility artifact increasing transparency along the operational value stream.

However, linking development value streams to operational value streams helps abandon the greenfield approach and extend the BMC by to additional components.

The two extensions are "Contribution to the Strategy" and "Technical Debt." Nearly every epic has to legitimate its strategic fit for purpose in a more transparent way. Technical debt is also a matter that has to be dealt with transparently, as it seldom will disappear in the short term.

With those two extensions, the BMC grows from a useful Startup-Tool to an even more powerful Business Agility Enterprise Artifact.

The Extended Business Model Canvas (EBMC) links Lean Portfolio Management, System Thinking, Lean Product development, and agile development in a way suitable for established enterprises, not just startups.
Two additional components, the "Contribution to Strategy" and "Technical Debt," apply now to operational and development values. Those components are supported by two special lenses that help agile teams to connect better, align, and achieve more business agility.

The Business Model Canvas (BMC) developed by Osterwalder and Pigneur explains "how value is created, delivered and captured from an organizational perspective." The BMC excels through the addition of the simple yet effective Value Proposition Canvas (VPC). The BMC combined with the VPC unfolds the driving powers and key pivot points along the operational value stream. It is a valuable Business Agility artifact increasing transparency along the operational value stream.

However, linking development value streams to operational value streams helps abandon the greenfield approach and extend the BMC by to additional components.

The two extensions are "Contribution to the Strategy" and "Technical Debt." Nearly every epic has to legitimate its strategic fit for purpose in a more transparent way. Technical debt is also a matter that has to be dealt with transparently, as it seldom will disappear in the short term.

With those two extensions, the BMC grows from a useful Startup-Tool to an even more powerful Business Agility Enterprise Artifact.

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Extended Business Model Canvas (OOP 2021)

  1. 1. Extended Business Model Canvas Business Agility, extended Kurt Cotoaga February, 9th 2021
  2. 2. Kurt Cotoaga (CGI) Pivots towards Business Agility… 2 Evolutionary algorithms for np-hard problems Quant Research Assistant Large financial web- portals and market information systems for banks and media Fool Product Manager XP, the agile manifesto and a lot of luck opened a path from team, via program towards the portfolio Learner SME SPC, RTE, LPM, CLP, PSM I Business Value Artist Digital Evangelist Consultant ?
  3. 3. 3 Working Agreement #gerneperDu English slides just because they are simpler to share Switch on your web cam and unmute – be present Assume positive intent from everybody and enjoy Think loud, feel free to interrupt, give feedback This is a Workshop!
  4. 4. 4
  5. 5. 5 Some numbers on CGI Inc. People trained: 15.000 + people trained in scrum and scaling in last 3 years Over 125 agile @ scale engagements in the last two years Launched over 1.750 scrum teams in the last two years Over 15 large scale transformations ($150m) in the last 3 years CGI coaches have an average of 19-month tenure at clients Big ($1.2b) agile transformations
  6. 6. 6 Very few enterprise-wide agile transformations are going well Those who aren’t doing well, are not talking about it for obvious reasons – it’s not going well.. … Those who are successful, are not talking about it either – because lean agile has become a huge competitive advantage
  7. 7. When we examine corporations, we usually find this combination 7 Daily Stand Ups JIRA Tablets Digital Theater in Ivory Silos Factory style local workshop optimization from the steel age Silos and management paradigm from the age of mass production
  8. 8. 8 Impediments on unleashing the power of Lean and Agile at scale orthodox contracting connecting to portfolio & vision broken CE/CI/CD pipeline frameworks help scaling beyond single teams but…
  9. 9. Workshop Goals – Extended Business Model Canvas (EBMC) Get a new tool, understand it, learn how to use in your context… Application • Use Cases • Limitations • Application Foundation • Multi Loop Learning • Perspectives • Language EBMC • Flow of Business Value • Design Thinking • Value Streams • Strategy • Technical Debt
  10. 10. 10 Perspectives – an old source for philosophical debates… Ludwig Wittgenstein (1889-1951) True True Truth
  11. 11. 11 Design Thinking (DT) – Double Diamond Discover Define Ideate Prototype Test Understand the problem Design the right solution Insights Ideas Reality Divergent Convergent Divergent Convergent Desirable Feasible Viable Sustainable
  12. 12. 12 Why DT? Because the Spice Must Flow… Paul Atreides
  13. 13. 13 Porters Value Chain – Economies of Scale (orthodox) Human Resource Management Infrastructure Procurement Technology Development Inbound Logistics Operations Outbound Logistics Marketing and Sales Service M a r g i n M a r g i n Primary Activities Support Activities
  14. 14. 14 Value Streams – Economies of Flow for Business Value (orthodox) Value Stream Throughput Inventory OpEx Dead-end X Cashflow https://amzn.to/3mFfrfM
  15. 15. 15 Business Value (VUCA Version) : get new code in production… Dead-end Value Stream New Code in Production
  16. 16. 16 Value Stream Forces Dead-end Disruption Value Stream Planned Operation Unplanned Evolution Business Agility Technical Debt Action (self controlled) Reaction (triggers outside)
  17. 17. 17 Value Stream analysis via Business Model Canvas Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Value Stream #pull #push https://amzn.to/2Vq0jYL
  18. 18. 18 Value Proposition Canvas Customer Segment Value Proposition Gain Creator Pain Relief Products & Services Pain Gain Jobs https://amzn.to/3gasnI8
  19. 19. 19 Let’s take a look at the Movie Theater Business Model
  20. 20. 20 The Business Model Canvas Revisited (Movie Theaters) Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Value Stream
  21. 21. 21 Let’s take a look at the Broadcasting Business Model
  22. 22. 22 The Business Model Canvas Revisited (TV Broadcasting) 22 Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels
  23. 23. 23 Linking Value Streams to Business Models Value Stream D e v e l o p m e n t V a l u e S t r e a m D e v e l o p m e n t V a l u e S t r e a m #evolve
  24. 24. 24 Link Portfolio to Program Link Reality to Expectation Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Technical Debt Contribution to Strategy Value Proposition Gain Creator Pain Relief Products & Services Customer Segment Pain Gain Jobs Value creation (single point in time) V a l u e e v o l u t i o n ( b u s i n e s s a g i l i t y )
  25. 25. 25 The Extended Business Model Canvas Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Contribution to Strategy Technical Debt
  26. 26. 26 Link Portfolio to Program Link Reality to Expectation Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Technical Debt Contribution to Strategy
  27. 27. 27 27 Strategy – an inflationary used term Carl von Clausewitz (Karl Wilhelm Wach around 1818) War is the realm of uncertainty; three quarters of the factors on which action in war is based are wrapped in a fog of greater or lesser uncertainty. A sensitive and discriminating judgment is called for; a skilled intelligence to scent out the truth. “ Keiretsu https://en.wikipedia.org/wiki/Keiretsu
  28. 28. 28 Visionary Leader Rally the change coalition towards a desirable future – be pulled positively in a direction
  29. 29. 29 Burning Platform Be pushed away from an undesirable state – structured retreat towards the unknown future…
  30. 30. A simplified approach Richard Rumelt outlines a strategy model that is excelling through its simplicity. 30 https://amzn.to/38dDPiM Focus Guardrails Initiatives
  31. 31. A simplified approach Richard Rumelt outlines a strategy model that is excelling through its simplicity. The strategy “kernel” has three layers. 31 Focus Guardrails Initiatives #diagnosis ACME Corporate Strategy #guiding policies Principles #coherent actions Epics and Features Connects: • The strategic planning silo • The orthodox methodology ivory tower • The program and portfolio management
  32. 32. 32 Technical Debt (do not be too strict)
  33. 33. Technology Debt Quadrants The term was introduced by Ward Cunningham back in 1992 but got famous through Martin Fowler’s work on refactoring and his technical debt quadrants from 2003. 33 Intentional Unintentional Prudent Reckless https://martinfowler.com/ bliki/TechnicalDebtQuadrant.html directed chaotic
  34. 34. Technology Debt Playground The term was introduced by Ward Cunningham back in 1992 but got famous through Martin Fowler’s work on refactoring and his technical debt quadrants from 2003. However, the definition of the term evolves and there are new fresh thoughts on this topic, as from Matt Warcholinski… 34 Intentional Technical Intentional Organizational Unintentional Technical Unintentional Organizational Prudent Reckless https://brainhub.eu/ blog/how-to-deal-with-technical-debt/ directed chaotic
  35. 35. Technology Debt Legacy Playground The term was introduced by Ward Cunningham back in 1992 but got famous through Martin Fowler’s work on refactoring and his technical debt quadrants from 2003. However, the definition of the term evolves and there are new fresh thoughts on this topic, as e.g. from Matt Warcholinski… Now let‘s mix it together to spice it up! …if you still have no idea where to start, add Legacy as a general area to put in first stickies. 35 Intentional Technical Intentional Organizational Unintentional Technical Unintentional Organizational Prudent Reckless Legacy directed chaotic
  36. 36. Strategy Technology Debt Canvas 36 Intentional Technical Intentional Organizational Unintentional Technical Unintentional Organizational Legacy Reckless Focus Guardrails Initiatives directed chaotic
  37. 37. Use Case: The Corona Warning App 37 Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Technical Debt Contribution to Strategy Population RKI Identification of unknown chains of infection Access to the test Information about the risk App Store Play Store Media (additional) Budget App Developer Hotline Community Management Virology Lawyers Development Operations Ongoing enhancements Apple Google RKI 20 (70) Reduce further spreading Distance and hygiene Test strategy 1,5 Meter Tape Masks Tests Vacine one centralized approach for the app Data protection concerns
  38. 38. Strategy Technology Debt Canvas 38 Intentional Technical Intentional Organizational Unintentional Technical Unintentional Organizational Legacy Reckless Focus Guardrails Initiatives directed chaotic one centralized approach for the app Data protection concerns Reduce further spreading Distance and hygiene Test strategy 1,5 Meter Tape Tests Vacine
  39. 39. Extended Business Model Canvas (EBMC) Avoid best practices for new situations. Try the Extended Business Model Canvas as a starting point for business agility and partnership between business and IT. Try stress testing the model by shifting or disabling boxes. Explore empty or full boxes. Avoid the urge to come up with quick solutions… 39 Cost Structure Revenue Streams Value Proposition Customer Segments Key Partners Key Activities Key Resources Customer Relationships Channels Contribution to Strategy Technical Debt
  40. 40. Strategy Technology Debt Canvas Avoid to fill the strategy by the LPM team, let the IT start Try the other way for the technical debt. Explore your recent retro boards for input for the technical debt. Try to run at least two cycles. Avoid the urge to come up with quick solutions… 40 Intentional Technical Intentional Organization al Unintentiona l Technical Unintentiona l Organization al Legacy Reckless Focus Guardrails Initiatives
  41. 41. The perception of Business Value on all organizational levels is essential to balance exploration, creation, and delivery, which is crucial for thriving in the Digital Age. Kurt Cotoaga Digitalization Evangelist, Business Value Artist Scaled Lean-Agile Coach kurt.cotoaga@cgi.com +49 162 4314289 linkedin.com/in/kurtcotoaga/ @Kydroon

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