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Busines Model Innovation


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מצגתו של Sachin Joshi שהוצגה במפגש שווקים מתפתחים ופיתוח בר קיימא

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Busines Model Innovation

  1. 1. Business ModelInnovationSustainable & Inclusive © Confederation of Indian Industry
  2. 2. We live in an increasingly volatile world 25% of 100 global companies surveyed by AMR Research said thatSource: The Global Poverty Project commodity cost volatility/availability is the biggest risk challenge facing their company today. © Confederation of Indian Industry
  3. 3. Consumption footprint Population footprintWe live in an increasingly disfigured world Poverty footprint Ecological footprint © Confederation of Indian Industry
  4. 4. Though incremental population is ondecline, most people will be added inless developed countries © Confederation of Indian Industry
  5. 5. Scramble forbasic needswill only getcomplex © Confederation of Indian Industry
  6. 6. Consumption will rise with increase inurbanisation; less than 50% people nowlive in rural areas © Confederation of Indian Industry
  7. 7. There aren’t moreEarths to supporthuman footprint in aBAU scenario Pressure on = f ( # of People) X (Quality of Life) the Earth 7 Billion Food, Energy, Water, Housing, Transportation, Lifestyles Pressure on = f ( # of People) X (Quality of Life) the Earth 9 Billion Respectable QoL for All © Confederation of Indian Industry
  8. 8. Create value through transformation +++ Transformative New markets BoP Energy positive buildings Mobility solutions Radical Solutions for theSustainability poorValue IT@help Resource saving Incremental Electric cars Alignment with business Renewables Reactive Community initiatives Reacting to Resource conservation outside pressure Policies & systems in an ad-hoc way + + Business Value +++ © Confederation of Indian Industry
  9. 9. NEW OPPORTUNITIESNEW MODELS © Confederation of Indian Industry
  10. 10. What? 1stW solns ≠ 3rdW needs India, a Why? world in itself potential = gap + challenge Next big export Poverty in the EU & the US Show the way (process) New biz models Meet unmet needs (soln) Affordability thru scale for penetration Energy, health, sanitation, water, education Energy, health, jobs Successes Infrastructure HUL-Shakti Experience Drivers Selco NetworksShortages/deficits – scramble NDDB Institutions Entrepreneurship HITW Collaborations Market opps ITC Recognition H2O purifier Finance M-banking © Confederation of Indian Industry
  11. 11. "I shall have to defend myself on one point, namely, sanitary conveniences. I learnt 35 years ago that a lavatory must be as clean as a drawing- room.” 24 May 1925India is ranked as the second worst country for sanitation © Confederation of Indian Industry
  12. 12. 2.6 bn without facilities Shit is good business © Confederation of Indian Industry
  13. 13. Four characteristics of SI2• add value to the life of the people much beyond the immediate use of the product or service• create a product or service of an uncompromising quality at a price that is affordable• address the challenge of resource use efficiency to manage drastically low cost structures• scalable and replicable to suit requirements of local circumstances and complexities © Confederation of Indian Industry
  14. 14. Often, constraints to growth lie within• Policies/ regulations • Project approach• Infrastructure deficit • Iterative & not linear• Finance scarcity • Detached business• Customer knowledge strategy/ model• Cultural differences • High costs/ overheads • Need based External Internal © Confederation of Indian Industry
  15. 15. Why is BMI important?Constant need to find new ways to grow and remain competitiveNew competition comes with radically different business modelsIndustry structures are transforming © Confederation of Indian Industry
  16. 16. In which industry is © Confederation of Indian Industry
  17. 17. What industry are they in? © Confederation of Indian Industry
  18. 18. © Confederation of Indian Industry
  19. 19. © Confederation of Indian Industry
  20. 20. 01 / Shaadi.comFor proving that marriage, Indian-style, works online as well as off. This year, the worlds largestmatrimonial site plans to open retail sites for marriage counselors for its 20 million registered users.02 / Tata MotorsFor leveraging its knowledge of the Indian market. Since the launch of the Indica in 1999, Tata Motorshas launched products such as the Nano, Aria, Indigo and a host of commercial and utility vehicles thatmeet the particular transport needs of Indian consumers and businesses.03 / HarVaFor expanding Indias outsourcing industry to rural areas. Created to "harness the value of rural India"--and head off the loss of outsourcing businesses to even lower-cost locations than Bangalore or Mumbai--HarVa is one of Indias first rural business process outsourcing (BPO) operation. HarVa trains young ruralpeople, especially women, to develop technical skills, from data entry to software testing.04 / Apollo Telemedicine Networking FoundationFor scaling telemedicine. With more than 150 telemedicine centers across the globe, Apollo offers mobiletelemedicine units in areas where there are no hospitals, remote consultations, and ICU monitoring. Itsweb-enabled telemedicine app, Medintegra WEB, allows doctors, nursing homes, and hospitals to bettertreat patients in rural areas.05 / Gram Vaani (Village Talk)For making community radio possible in villages and small towns. Gram Vaanis simple server andsoftware helps rural communities create their own radio stations. Twelve are broadcasting today, witheven more in the queue. © Confederation of Indian Industry
  21. 21. 06 / Invention LabsFor giving a "voice" to speech-impaired children. The companys AVAZ device interprets the gross motormovements of a child and uses predictive software to help users form sentences, which it then readsaloud. It also includes a portable touch-screen voice synthesizer, which can be easily mounted on awheelchair.07 / A Little WorldFor taking banking to the remotest of villages in India. Relying on biometric authentication, it connectsmore than 3 million customers to 25 major banks, which allows them to expand without branches. It alsoprovides a means for disbursing various government payments to the poor.08 / Digital GreenFor crowdsourcing instructional videos. To reach the legions of Indian farmers that ignore instructionalmedia from the agriculture industry, Digital Green turned the camera over to a more trusted teacher: theirpeers. The company lets select villagers film themselves demonstrating new agricultural techniques.Then, after checking for accuracy, it screens them for the farmers using handheld projectors.09 / FabindiaFor connecting more than 40,000 traditional craftspeople with the worlds growing urban middle class.Through its website and 136 retail stores (including one each in Rome, Kathmandu, andDubai), Fasbindia sells clothing and products for the home, all of which are sourced from villages acrossIndia.10 / Godrej GroupFor introducing refrigeration to Indias rural masses. The Godrej ChotuKool costs roughly $70, does nothave a compressor and runs on batteries. © Confederation of Indian Industry
  22. 22. WHAT IS A BUSINESS MODEL? © Confederation of Indian Industry
  23. 23. What is a business model?Simplest form What How Who © Confederation of Indian Industry
  24. 24. Business model for the next gen enterprise Return Target Enablers Segment Value Creation Investme Delivery nts © Confederation of Indian Industry
  25. 25. What is business model innovation?• Change of two or more components• Redefine a company’s basis for competition• Lead to a superior value creation © Confederation of Indian Industry
  26. 26. notWhat is business model innovation?• Single function’s innovation• Uncoordinated functional innovation• Internal efficiency improvement• Mere product, service or technological innovation © Confederation of Indian Industry
  27. 27. Business model for next gen enterprise Return Target Enablers Segment Value Creation Investme Delivery nts © Confederation of Indian Industry
  28. 28. Business model for next gen enterprise What are the revenues & margins? What is the impact? Return What are the key competencies, capabilities, and capacities? Value Creation Target Enablers What is the impact Segment “beyond the job to be done” Who’s the customer? Who are the beneficiaries? Which “job to be done” is offered? Investme Delivery nts Which are the cost centres? What is the channel? What’s Who’s investing? What are the brand image? How do the values? you engage? © Confederation of Indian Industry
  29. 29. Twitter challengeValue creation statement in 140 characters © Confederation of Indian Industry
  30. 30. Non-poor, asset holders, credit worthy Unbanked poor, little/ no assetsMainstream loan portfolio Micro loans, no collateralsStrong risk management High repaymentHuge profit focus Community ownershipProfits shared with shareholders Profit reinvestment © Confederation of Indian Industry
  31. 31. BMI of a typical MFI Interest payments Financial access – loans, Return savings, pensions Government Target Enablers Segment Communities, women Value Creation Unbanked poor,Entrepreneurship training mainly women Micro-finance Income generating Investme Delivery Capital costs nts Direct / branches Low fixed costs Entrepreneurship training © Confederation of Indian Industry
  32. 32. © Confederation of Indian Industry
  33. 33. BMI for virtual micro-lending Interest or service charge Return Resourceful urbanitesOnline payment platforms Target Enablers Global Local MFIs Segment Value Creation Rural / urban poor Local MFIs Screening Investme Delivery nts Risk management Donations Online platform © Confederation of Indian Industry
  34. 34. Service charge from GP ReturnGrameen PhoneGrameen Bank Village phone Enablers Target operators Segment Value Creation Village poor Village phone Cellular services @ 50% discount Grameen branches Investme Delivery nts Airtime bills to GP Women entrepreneurs Service charge to Grameen Bank © Confederation of Indian Industry
  35. 35. Upto 1000 watt Output: 30 ltr/ wattSolar SubmersiblePanel Pump Solar Drive © Confederation of Indian Industry
  36. 36. Domestic lighting in night timeSolar Panel Solar Drive 12/24 V, 40 Ahr © Confederation of Indian Industry
  37. 37. The Period Industry ~500 mn women in India do not use sanitary napkins resort to using dirty rags, newspapers, dried leaves, and ashes buying sanitary napkins meant no milk for the family girls who attain puberty in rural areas either miss school for a couple of days a month or simply drop out altogether Indian market size: $ 35 mn / year Annual growth rate: 16%Source: "Sanitation protection: Every Women’s Health Right," a study by AC Nielsen. © Confederation of Indian Industry
  38. 38. Small-scale sanitary napkin machine = $2,500 Return Value Creation TargetEnablers Low-cost sanitary Segment napkins Women entrepreneurs as Women entrepreneurs producers & sellers Better health Rural women as users Investme Delivery nts Small-scale production system; SHG model; women salespersons © Confederation of Indian Industry
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  40. 40. • Increased income by $300-400 / acre for onion farmers • Increased net incomes by $100-$1,000 / acre due to efficiency gains • Estimated reduction of 500 million cubic meters of water per year as compared to flood irrigation • 35,000 tons of onions procured from 1,800 contract farmers in 2008, of which 90% are small farmers © Confederation of Indian IndustrySource: IFC
  41. 41. Jain Irrigation • Ensured market and increased income by $300-400 per acre for onion farmers • Increase in net incomes by $100to $1,000 per acre due to efficiency gains • Estimated reduction of 500 million cubic meters of water per year as compared to flood irrigation • 35,000 tons of onions procured from 1,800 contract farmers in 2008, of which 90% are small farmersSource: IFC © Confederation of Indian Industry
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  43. 43. © Confederation of Indian Industry
  44. 44. Low-cost & high standardisation• Hospitals are taken on long leases (15-20 years) from those who could not run them• Focus on a particular niche – maternal and child care – cuts down on the need for many specialist doctors and also on the range of equipment needed• Standardisation in clinical procedures and kits brings down costs too – 8 times more procedures than other private clinics. – operating theatres accommodate 22-27 procedures each week compared to 4-6 in a private clinic © Confederation of Indian Industry
  45. 45. Skill-based deliverables• Doctors, on an average, perform 17-26 surgeries per month, which is 4 times compared to others• Earn fixed salaries rather than the variable consulting fees of their private clinic peers• Less qualified auxiliary nurse midwives (ANMs) rather than graduate nurse midwives (GNMs) – ANMs are trained as birth attendants; cost much less than GNMs © Confederation of Indian Industry
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  47. 47. Process re-engineering• 30 surgeries / day compared to 4-5 by other major hospitals – Doctors: vertical approach towards specialisation – Deskilling: train high school qualified women to take echocardiograms• Mortality rate – 2%• Wider reach – partnership with ISRO, Indian Post Services, SANA © Confederation of Indian Industry
  48. 48. “Goal: wipe out needless blindness”,Aravind’s founder, D G Venkataswamy• 60% of patients treated for free, even as it remains a profitable venture• disaggregated course of care• surgical eye-care process is the key• minimises the demands on doctors’ time: the doctor performs only the preliminary examination, final diagnosis, and surgery• rest is done by paraskilled paramedics• doctors at are highly productive and patient throughput is high; 2,400 surgeries / doctor / year compared to 300 in standard Indian clinics © Confederation of Indian Industry
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  50. 50. Leveraging technology for diagnosis ReMeDi (remote medical devices) set up kiosks in villages An integrated patient-record centre helps doctors in recording all health-related issues of a patient Basic set of parameters include:  Stethoscope, thermometer, blood pressure meter, webcam, and ECG Patient readings are transmitted to the doctor who make preliminary diagnoses and issue prescription © Confederation of Indian Industry
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  52. 52. Akash Ganga: 10,000 villages & still scaling 3. Collects in small community tanks 1A. Rent rooftops 1B. Get harvesting rightsWater used for horticulture 4. PRI leases for free 2. Channel water to tank: 10,000 M2 area 50% household use © Confederation of Indian Industry
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  54. 54. Micro-distribution Aim is to provide eye care and eyeglasses to people in developing countries that might not otherwise have access Vision entrepreneurs sell door-to-door spectacles Vision entrepreneurs are community members, sell health products to low income households © Confederation of Indian Industry
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  57. 57. The next gen enterprise model System sales, RE, Return livelihood creation RRBs, NGOs, farmer cooperatives, SHGs Target Enablers Segment Design, services and finances solar systems Value Creation Rural poor; Rs 2000 / mth Customised solar energy solution; livelihood linked Investme Delivery nts Energy service Manufacturing, servicing, centres training © Confederation of Indian Industry
  58. 58. Beyond the job-to-be-done• Longer business hours - higher monthly incomes• Cleaner, healthier environments, both at work and at home• Increased safety for mobility and protection from animals• Reduced dependence on kerosene/LPG - reducing monthly energy costs• More time for children to study after sunset• More quality time spent with families (television, dinner)• Increased possibility of use of televisions, computers, and cellular phones © Confederation of Indian Industry
  59. 59. THANK YOUSachin © Confederation of Indian Industry