BUSINESS MODELAS DEFINED BY OSTERWALDER AND PIGNEUR“A business model describes the rationale of how an organization creates, delivers, and captures value”
BUSINESS MODELAS DEFINED BY OSTERWALDER AND PIGNEUR “A business model…show[s] the logic of how a company intends to make money.”
There are nine essential andinterrelated parts within any business covering “customers, offer, infrastructure and financial viability”
THE 9 BUILDING BLOCKS1 CUSTOMER SEGMENTS 2 VALUE PROPOSITIONS• Group of people a company • Products and services that targets and chooses to serve create value for the specified Customer Segment• Distinctly segmented based on common needs/attributes • Either solve a customer problem or satisfie a customer• Heart – “For whom are we need – “What value do we creating value?” deliver to the customer?• Mass? Niche? Segmented? Diversified? Multi-sided markets? • Newness? Performance? Customization? Convenience/ Usability? Brand? Price?
THE 9 BUILDING BLOCKS3 CUSTOMER SEGMENTS 4 CUSTOMER RELATIONSHIPS• Customer Touch Points • Types of relationships utilized to deliver a Value established with a specific Proposition Customer Segment• Finding the right mix/match • Motivated by Customer between Channel Types and Acquisition/ Customer Phases is crucial – “Through Retention/ Boosting Sales – which Channels do our “What type of relationship Customer Segments want does each of our Customer to be reached?” Segments expect us to• Partner/Own/Indirect/Direct with establish and maintain with Awareness/Evaluation/ them?” Purchase/Delivery/After Sales • Personal Assistance? Self-service? Automated services? Co-creation?
THE 9 BUILDING BLOCKS5 REVENUE STREAMS 6 KEY RESOURCES• Cash Earnings generated • Most important assets from each Customer Segment required to make the business model work• Transaction vs. Recurring Revenues , Fixed vs. Dynamic • Allow the company to create Pricing - “How much does and offer a Value Proposition, each Revenue Stream reach markets, maintain contribute to overall Customer relationships, and revenues?” earn revenues – “What Key Resources do our Value• Asset Sale? Usage Fee? Subscription Fee? Lending/Renting/Leasing? Propositions require?” Licensing? Brokerage Fees? Advertising? • Physical? Intellectual? Human? Financial?
THE 9 BUILDING BLOCKS7 KEY ACTIVITIES 8 KEY PARTNERSHIPS• Most important activities • Most important network required to make the business of suppliers / partners model work required to make the business model work• Routine/critical tasks that engage customers and turn a • Motivated by optimization and profit – “What Key Activities economy of scale/ Reduction do our Value Proposition of risk/ Acquisition of require?” particular resources – “Who• Production? Problem solving? are our Key Partners? Who Platform/Network? are our key suppliers?” • Strategic Alliance? Coopetition? Joint Venture? Buyer-Supplier?
THE 9 BUILDING BLOCKS9 COST STRUCTURE• All/Most important costs incurred to operate a business model• Cost-driven vs. Value-driven Cost Structures – “What are the most important costs inherent in our business model?”• Fixed costs? Variable costs? Economies of Scale? Economies of Scope?
A flexible template for capturing, analyzing, and creating a shared languagebetween the 9 building blocks of a business model
THE BUSINESS MODEL CANVAShttp://www.businessmodelgeneration.com/toolbox
BUSINESS MODEL GENERATION Plot the Understand Find the Regularly re- Review & RebuildWall Poster Design & Execute Sketch & Post Canvas on a and sketch pattern*/s assess Poster & put out business that best suit viability & on the wall model using your business future promise then design with a SWOT drawings & within each of moveable your own Mobilize the 9 and post-its rebuild design Design & as necessary Understand Implement Manage * “ U N BU N D L E D ” BU S I N E S S M O D E L / T H E LO N G TA I L / M U LT I - S I D E D P L AT F O R M / “ F R E E ” B U S I N E S S M O D E L / “ O P E N ” B U S I N E S S M O D E L