The document discusses business model transformation and innovation, emphasizing the importance of defining customer value propositions and profit formulas. It highlights examples from companies like Hilti and Godrej that illustrate different strategies for market transformation and new growth creation. The text concludes with a quote from Jeff Bezos about the necessity of adapting to customer needs to maintain a competitive advantage.

2. Business Model Transformation:
Succeeding in new growth and renewal
Mark W. Johnson
Co-Founder and Senior Partner
Innosight

3. The evolution of the MP3 player
Rio Diamond Rio Riot iPod Shuffle iPod Touch
1998 2002 2005 2007
2000 2003 2006
Best Data iPod 3G iPod
Cabo64 Nano

4. iTunes/iPod and Apple’s growth

5. Steve Jobs announcing Apple’s Digital Hub Strategy January 2001

7. Core vs. New Growth Innovation
Established New
Business Business
(Model) (Model)
Strengthening and
Creating the new
extending the core
AND not OR!

8. The business model defined
Customer Value
Proposition
Profit Formula
Key Key
and Core Mission
Resources Processes

9. Hilti: transforming an existing market
vs.
Tradt’l Power Tool Company Tool Fleet Management Services
Customer
Value Fleet management to
Power tools and accessories
Proposition improve on‐site productivity
Profit Low margin, Subscription model covering
Formula high inventory turnover asset‐heavy balance sheet
Key Key Direct Sales, Contract
Retail distribution
Resources Processes management, IT Systems

10. Godrej: creating a new market
Addressing Awareness, Access, and Affordability

11. The new growth innovation process
1 2 3
Identify Blueprint
Test and Learn
The Jobs-to-be-Done business model

12. Addressing the “job-to-be-done”

13. Key to a powerful CVP:
Start with understanding the important, unsatisfied
jobs-to-be-done

14. The new growth innovation process
1 2 3
Identify Blueprint
Test and Learn
The Jobs-to-be-Done business model

15. The business model defined
Customer Value
Proposition
Profit Formula
Key Key
and Core Mission
Resources Processes

16. Maximizing the value proposition
CVP = Job Offering
(Importance)
(Satisfaction)
Price

17. Blueprinting a Business Model
Partnerships, Job to be done Offering:
collaboration, • Product / Service
shared
Rules,
services
Norms &
Metrics
(e.g. brand, people, • Access/Channel
technology, channel) Customer
Value
Rules, Key Proposition • Payment scheme /
Norms, and Resources Price
Metrics
Key Revenue model
Processes Profit
Formula
(e.g. R&D,
manufacturing, HR, Rules,
marketing, IT)
Cost structure (direct and overhead) & Norms, and
Resource velocity Metrics
(e.g. margin)
17
© Copyright 2012 Innosight LLC 17

18. The new growth innovation process
1 2 3
Identify Blueprint
Test and Learn
The Jobs-to-be-Done business model
© Copyright 2012 Innosight LLC 18

19. The need for testing and learning

20. Amazon.com: Built to transform

21. Business Model Innovation:
Design around the job
“If you want to continuously
revitalize the service that you
offer to your customers, you
cannot stop at what you are good
at. You have to ask what your
customers need and want, and
then, no matter how hard it is, you
better get good at those things.”
–Jeff Bezos, CEO, Amazon

22. Thank You
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