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Flexible Business Modeling

April 9th, 2013

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Canvas tips AlternativesIn today’s business environment, business models are changing constantly. Technology changes, competition adjusts, collaboration opportunities present themselves. Imagine being able to view your business model on a single sheet, to be able to adjust and develop it in real time as circumstances alter and work collaboratively within the business and with your business partners.

Sorry if that sounds like a sales pitch – it is not. However, it is an approach that has many businesses thinking differently about their business model simply through the ability to see it visually and understand the connections and dependencies within it.

The original concept of a one page business model has been around for years. This approach, in its execution, has been ‘crowdsourced’ and tested throughout its development by businesses in a number of industries – including consultants and advisers.

“Business Model Generation has been co-authored by 470 Business Model Canvas practitioners from 45 countries. The book was financed and produced independently of the traditional publishing industry. It features a tightly integrated, highly visual design that enables immediate hands-on use.”

The basic page format is downloadable from the web and can be used without any further resources. There is a book that explains how it can be used in different businesses and business model types and a short video on YouTube to get you started. There are also software tools available to support the processes that encountering the Canvas will trigger.

So what does the canvas look like?

Business Model Canvas Format - click image to get a larger view

The main sections are –

  • 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 products and services are we offering to each Customer Segment?
    Which customer needs are we satisfying?
  • Customer Segments
    For whom are we creating value?
    Who are our most important customers?
  • 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?
    For what value are our 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?
  • Key Activities
    What Key Activities do our Value Propositions require?
    Our Distribution Channels?
    Customer Relationships?
    Revenue streams?
  • Key Resources
    What Key Resources do our Value Propositions require?
    Our Distribution Channels? Customer Relationships?
    Revenue Streams?
  • 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?

Finally, the two key areas that determine if the Business Model works –

  • Revenue Streams
    For what value are our 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?
  • 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?

There is a slightly different version of the Canvas for sole traders and for career planning which can be accessed through the Business Model Generation site.

Give it a try. We’d love your feedback here on the applicability to our members’ businesses. Consider how you can use it with the effectuation approach set out in a previous article in this newsletter.

Enjoy the planning experience!

 

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