NEW TOOLS NEW SKILLS NEW MINDSET

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1 BE A REBEL BUSINESS MODEL INNOVATION FOR MARKETERS DESIGNBETTERBUSINESS NIMA, 8 december 2016 YOU WILL ALL BE DESIGNERS! NEW TOOLS NEW SKILLS NEW MINDSET WHY? BUSINESS AS USUAL IS DEAD 1

2 BUSINESS PLANS ARE SO 1980 OUR SHARED GOAL, A BETTER BUSINESS WE WILL GIVE YOU TOOLS A COMMON LANGUAGE TO DISCUSS BUSINESS WE WILL WORK ON BUSINESS MODELS IMPORTANT LESSONS FOR YOUR BUSINESS 2

3 ARE YOU ` READY? THRILLING RIDES OR NOT WE ARE ALL RESPONSIBLE WHO ARE ` YOU? WHAT DO YOU ` EXPECT? AN INTRODUCTION 3

4 GIJS MENSING HOW IT ALL STARTED 4

5 WE WANTED TO DISRUPT THE PUBLISHING INDUSTRY 24 USD 36 USD 5

6 54 USD 81 USD 243 USD 1.2 MILLION COPIES 32 TRANSLATIONS MOST ADDED VALUE IN VALUE PROPOSITION DESIGN PUBLISHED OCTOBER

7 ENGINGE IN START-UPS ` WE (RE-) DESIGN BUSINESSES ENGINGE IN CORPORATES ` LOCATIONS POINT OF VIEW GOAL DESIGNING BETTER BUSINESSES designbetterbusiness.com 7

8 IDEATE VALIDATE POINT OF VIEW UNDERSTAND PROTOTYPE WHY IS BUSINESS MODELING SO POPULAR? DESIGNING BETTER BUSINESSES DESIGNING BETTER BUSINESSES DISRUPT BEFORE WE ARE DISRUPTED 8

9 Insights from Moments of Impact: UNFORESEEN TURBULENCE IS A CONSTANT FEATURE IN OUR WORLD VUCA WORLD: NON-STOP VOLATILITY, UNCERTAINTY, COMPLEXITY AND AMBIQUITY LIKE AN AMUSEMENT ` PARK: FULL ` OF THRILLING RIDES. ` NOT ALL OF THEM ` ARE FUN. THE WORLD HAS CHANGED Source: Moments of Impact IN LEGAL SUPPORT 9

10 IN GROCERIES FROM THIS TO THIS IN LEGAL SUPPORT IN LEGAL SUPPORT OR EVEN THIS! IN LEGAL SUPPORT IN EDUCATION 10

11 FROM THIS ` TO THIS ` FINANCING IN LEGAL SUPPORT IN PUBLISHING 11

12 FROM BOOKS ` TO KINDLE ` FROM THIS ` IN PUBLIC TRANSPORT TO UBER ` IN OWNERSHIP 12

13 FROM THIS ` TO BMW DRIVENOW. ` FROM SHOP ` IN RETAIL TO AMAZON ` IN MUSIC 13

14 FROM RECORD ` SHOP TO STREAMING ` SUSTAINABILITY ` THE RULES OF BUSINESS HAS CHANGED NEW GROWTH ` REGIONS NEW WAYS OF ` PAYMENT 14

15 NEW TECHNOLOGY ` CHANGING REGULATION ` ONLINE REVOLUTION ` ONLINE REVOLUTION ` CHANGING `CONSUMER 15

16 SO 16

17 THE WORLD HAS CHANGED THE TRADITIONAL MARKETING MIX IS NO LONGER RELEVANT FROM INSIDE-OUT ` TO OUTSIDE-IN ` AND REPLACED ` BY SAVE 1 SINGLE QUESTION WHERE IS VALUE CREATED? 17

18 NEW TOOLS NEW SKILLS NEW MINDSET THE SPEED OF DEVELOPMENTS HAS INCREASED DO YOU ALSO SEE THIS? WHAT DO YOU WANT TO ACHIEVE? IT S MY JOB AS A DESIGNER TO MAKE CHOICES THAT TRIGGER THE RIGHT RESPONSES. Nathan Shedroff (Chair of the DMBA) IF YOU RE SITTING IN A ROOM WITH A BUNCH OF SLIDE DECKS, THERE S VERY LITTLE THAT CAN GO WRONG. THERE S JUST VERY LITTLE THAT CAN GO RIGHT, TOO. 18

19 LEAD BY DESIGN DESIGN IS A HUMAN SKILL THAT, FOR NOW EVEN GOOGLE CAN T AUTOMATE. John Maeda (Partner Kleiner Perkins) DESIGN IS NOT WHAT IT LOOKS LIKE IT IS HOW IT WORKS OBSERVE THE USUAL SUSPECTS BE PARANOID INNOVATION AS A DEPARTMENT RADICALLY SELF-DISRUPT ALL THE ROLES AND RULES COVERED WAR FOR TALENT REGULAR HIERARCHY A TEAM OF BELIEVERS 19

20 SIT THROUGH MEETINGS CREATE MOMENTS OF IMPACT WORK ON THAT SINGLE RIGHT SOLUTION EXPLORE OPTIONS AND PIVOT YOU WILL ALL BE DESIGNERS! BUSINESS MODEL? BUSINESS MODEL 20

21 A BUSINESS MODEL DESCRIBES THE RATIONALE OF HOW AN ORGANIZATION CREATES, DELIVERS, AND CAPTURES VALUE 1 CUSTOMER SEGMENTS THE BUSINESS MODEL CANVAS 2 VALUE PROPOSITIONS 3 CHANNELS 21

22 4 CUSTOMER RELATIONSHIPS 5 REVENUE STREAMS 6 KEY RESOURCES 7 KEY ACTIVITIES 8 KEY PARTNERS 9 COST STRUCTURE 22

23 KEY PARTNERS KEY ACTIVITIES VALUE PROPOSITIONS CUSTOMER RELATIONSHIPS CUSTOMER SEGMENTS #1 EASY CHECK IN COST STRUCTURE KEY RESOURCES CHANNELS REVENUE STREAMS ADD VALUE CHECK-IN TERMINALS #2 13M2 ROOMS ADD VALUE ROOMS #3 COSY ROOM AND FREE WIFI 23

24 ADD VALUE LOBBY LIVING ROOMS ADD VALUE DESIGN ADD VALUE CANTEEN M #4 DIY COUNTER ADD VALUE LOBBY LIVING ROOMS #5 LEAVE WHEN U WANT 24

25 REDUCE COSTS AMBASSADORS MICHAEL DID SOMETHING SMART ADD VALUE citizenm: business model EXERCISE What is our context? 1 25

26 WHERE `IS THE COMPETITION? ` OFTEN PEOPLE WANT TO ADD A 10 TH BUILDING BLOCK TO THE CANVAS CALLED COMPETITION WHAT DOES THE CONTEXT LOOKS LIKE? WE NEED A COMMON UNDERSTANDING OF WHAT IS IMPORTANT AND WHAT IS NOT LET S LOOK ` AT STRATEGYZER ` 26

27 EXERCISE: 10 MINUTES CONTEXT OF THE MUSIC INDUSTRY IN MINUTES EXERCISE: 5 MINUTES CONTEXT OF THE MUSIC INDUSTRY IN MINUTES DEFINE THE THREE MOST IMPORTANT ELEMENTS EXERCISE 2 The business models of the music industry 27

28 THE MUSIC INDUSTRY VALUE CREATION? FIRMS THAT RECORD, PRODUCE, PUBLISH, DISTRIBUTE AND MARKET MUSIC. FANS THAT LISTEN TO (OR EXPERIENCE) MUSIC. HOW DOES THE MUSIC INDUSTRY CREATE, DELIVER AND CAPTURE VALUE? 28

29 WHAT DIFFERENT BUSINESS MODELS DO EXIST IN THE MUSIC INDUSTRY? Music is something most people love, that no one dislikes and that touches everyone throughout their lives BrandAmp study, Millward Brown, 2007 BUSINESS MODELS IN THE MUSIC INDUSTRY WE WILL EXPLORE 4 BUSINESS MODELS IN THE MUSIC INDUSTRY! 1. RECORD COMPANY 2. PIRACY 3. I-TUNES 4. SPOTIFY 20 MINUTES 29

30 BUSINESS MODEL CANVAS RECORD COMPANY 1 A RECORD COMPANY Distribution channels Manufacturer s Marketing & promotion Detecting & building talent (contracting) Portfolio of star artists Hits and wannabee hits TV Retailers Mass market Copyrighted content Radio Digital Marketing & promotion Subsidizing unsuccessful Royalty payments Tours and concerts Huge sales from a few artists Merchandising artists albums BUSINESS MODEL CANVAS PIRACY UPLOAD DEVELOPERS OF ILLEGAL PEER-TO- PEER PIRACY 2 APPLICATION S AND SOFTWARE A NETWORK OF COMMITTED USERS DOWNLOAD USER SKILLS, INTEREST AND COMMITMENT ALL THE WORLDS MUSIC DIGITAL MASS MARKET HOSTING ADVERTISING BUSINESS MODEL CANVAS ITUNES HARDWARE/S OFTWARE DESIGN RECORD LABELS LOVEMARK ITUNES 3 OEMS MARKETING & SALES ITUNES SOFTWARE APPLE BRAND CONTENT & AGREEMENTS SUPPLY CHAIN MANAGEMEN T IPOD HARDWARE TALENTED PEOPLE (DESIGNERS SEAMLESS MUSIC EXPERIENCE AND GREAT DESIGN (MUSIC AND HARDWARE) ITUNES STORE RETAIL STORES SWITCHING COSTS APPLE STORES APPLE. COM MASS MARKET ) PEOPLE, DESIGN & DEVELOPMEN T MUSIC ROYALTIES MARKETING & SALES HARDWARE MANUFACTURI NG HIGH-VOLUME CONTENT REVENUE HIGH-MARGIN HARDWARE REVENUE 30

31 BUSINESS MODEL CANVAS SPOTIFY SPOTIFY 4 RIGHTHOLDER S (LABELS AND PUBLISHERS) ROYALTIES TO RIGHTHOLDER S PLATFORM AND BRAND PLATFORM DEVELOPMEN T AND MAINTENANC E LICENSING AGREEMENTS SALARIES SOFTWARE AND NETWORK ENGINEERS BANDWITH COSTS ADVERTISING ACCESS TO MUSIC VIA STREAMING AND DOWNLOAD SERVICES AD FEES 3 RD PARTY APIS AUTOMATED ONLINE RELATIONSHIP INTERNET + PC INTERNET + MOBILE COMMUNITIES SUBSCRIPTIO N FEES PC + MOBILE ADVERTISERS GLOBAL MUSIC FANS FREE DESIGNING BETTER BUSINESSES WHAT ARE THE LESSONS LEARNED FROM THE MUSIC INDUSTRY? THE BUSINESS MODEL OF THE FUTURE BUSINESS MODELS ARE NOT FIXED 31

32 YOU NEED TO LOOK AT THE MARKET UNDERSTAND YOUR CUSTOMER BE FAST & FLEXIBLE AND ADAPT! HOW CAN THE BUSINESS MODEL BE USED? THE BUSINESS MODEL CANVAS CAN BE USED FOR REDESIGN AND INVENTION HOW DOES IT CONNECT TO VISION, CONTEXT AND STRATEGY 32

33 OUR PROCESS THESE ARE THE MINIMUM STRATEGIC CONVERSATIONS IDEATE POINT OF VIEW UNDERSTAND EXERCISE Who is our customer? 3 VALIDATE PROTOTYPE WHO IS OUR CUSTOMER? MOST COMPANIES HAVE NO IDEA WHO THEIR CUSTOMER IS. DATA IS NOT ENOUGH 33

34 WHO IS OUR `CUSTOMER? WHAT DOES `HE WANT? WILLINGNESS ` TO PAY? 34

35 JOB TO BE DONE MILKSHAKE MOVIE WHAT IS THE JOB YOU GET DONE? NOT ABOUT A ROOM NOT ABOUT WINE TASTING THE EASE OF FEELING AT HOME POWER & SHOWING OFF! 35

36 NOT ABOUT A CAR NOT ABOUT THE HARDWARE CONVEY MY IMAGE! FIX OR REPAIR SOMETHING NOT ABOUT THE PERFECT SOLUTION BE SUCCESFUL & POSITION MYSELF 36

37 20 MINUTES YOU ARE NOW READY TO INNOVATE! 37

38 PROTOTYPING PROTOTYPING LET S YOU FAIL EARLY TO SUCCEED SOONER Ideo.com EXERCISE IN OCTOBER THIS BIKE AND $1,000.- ARE THE KEY RESOURCES OF YOUR BUSINESS MODEL DESIGN 3 DIFFERENT BUSINESS MODEL OPTIONS IN 6 MINUTES! Spend 6 minutes defining three different business model options with the bike and the $ 1.000,- as your key resources 38

39 BUSINESS MODEL 6 MINUTES 30 SEC BUSINESS MODEL INNOVATION WE NOW HAVE A LOT OF INFORMATION, BUT MAYBE 39

40 WE CAN PLAN FOR THE FUTURE! THINK LIKE A DESIGNER! DESIGN? DESIGN REQUIRES THE ABILITY TO IMAGINE THAT WHICH DOES NOT EXIST IT S A JOURNEY OF EXPLORATION 40

41 BOLDLY GO WHERE NO-ONE HAS GONE BEFORE It s a Journey. WHAT ARE DESIGN CRITERIA? CURRENT BUSINESS MODEL +/- +/- +/- +/- +/- 41

42 SO HOW DO WE GET FROM START TO FINISH? 42

43 IT S A PROCESS! 1 GENERATE OPTIONS EXPLORE OPTIONS 3 2CHECK Against design criteria 43

44 REPEAT 4 THERE IS NO SINGLE RIGHT ANSWER! KILL YOUR DARLINGS SHAKE YOUR BUSINESS MODEL! 44

45 FIRST WE WILL EXPLORE THE OPTIONS THERE IS MORE THAN 1 OPTION BUT Which options are the most interesting? IN ORDER TO ENABLE YOU TO EXPLORE THE OPTIONS IN DETAIL, WE WILL SEND YOU INTO SPACE 45

46 EXERCISE Marshmallow Challenge 4INGREDIENTS: 1 MARSHMALLOW 18 SPAGHETTI S 1 METER ROPE 1 METER TAPE 18 MINUTES HIGHEST FREE STANDING STRUCTURE MARSH MELLOW ON TOP BUSINESS MODEL VALIDATION LET S LOOK INTO SOME EXAMPLES SO YOU COME UP WITH A NEW IDEA OF BUSINESS MODEL INNOVATION 46

47 AND YOU THINK IT S WORTH A FORTUNE BUT IT S NOT BECAUSE AN IDEA OR BUSINESS MODEL IS ON PAPER ONLY A SET OF HYPOTHESES GUESS 47

48 IT HAS NO VALUE ZERO EVERY IDEA IS ALREADY INVENTED ONLY NOT BY YOU! BECAUSE WE ALL HAVE THE SAME PERSONAL FRUSTRATIONS AND THE SAME INFORMATION 48

49 SO WHAT DO WE DO THINK ABOUT YOUR NEW BUSINESS MODEL AS IF YOU ARE A START-UP LET S LOOK AT YOUR START-UP WHAT IS ACTUALLY A START-UP A START-UP IS NOT A SMALL VERSION OF A LARGE COMPANY. A START-UP IS A TEMPORARY ORGANIZATION IN SEARCH FOR A PROFITABLE, SCALABLE AND REPEATABLE BUSINESS MODEL Steve Blank 49

50 A START-UP IS ABOUT SEARCHING A (LARGE) COMPANY IS ABOUT EXECUTION Steve Blank Steve Blank EXECUTION IS NOT SEARCH EXECUTION FOLLOWS SEARCH IT IS ALL ABOUT LEARNING! PLEASE LOOK INTO THE FOLLOWING 50

51 YOU NEED TO CLARIFY YOUR ASSUMPTIONS YOU NEED TO TEST YOUR ASSUMPTIONS GO OUT OF THE BUILDING Source: Alex Osterwalder Instagram BEWARE! DON T DO IT THE EASY WAY 51

52 DON T HIRE AN AGENCY OR SET UP A TEST PANEL DO IT YOURSELF! THE MORE YOUR LEARN, THE SOONER YOU SUCCEED WHY? YOU LL INVENT SOMETHING PEOPLE DON T NEED 52

53 YOU NEED TO ASK YOURSELF THE FOLLOWING IS THE PROBLEM A REAL PROBLEM? DO WE IDENTIFY A TARGET CUSTOMER SEGMENT? CAN WE IDENTIFY THE NEED? AND ARE THEY WILLING TO PAY FOR THIS? YOU HAVE TO DO THIS TOGETHER 53

54 AND GO OUT TO TALK TO CUSTOMERS WATCH FIRST THEN ASK LOOK FOR NEEDS NOT SOLUTIONS PLUMBING BUSINESS LET S GO ON SAFARI! 54

55 8 PROTOTYPES FOR PUBLISHING A BOOK AND MAKE PIVOTS PIVOT YOUR IDEA OR VALUE PROPOSITION WHAT PIVOTS? IDEATE UNDERSTAND POINT OF VIEW TESTING THE ASSUMPTIONS PROTOTYPE VALIDATE 55

56 TEST CARD HOW DO WE DO THAT? Step 1 Hypothesis: We believe that Step 2 Test To verify that, we will Step 3 Metric And measure Step 4 Criteria We were right if IN THE LAST FEW YEARS WE HAVE BEEN WORKING WITH MORE THAN 400 INTERNATIONAL CLIENTS FROM START-UPS TO CORPORATE ORGANIZATIONS ON BUSINESS MODELING. WE PUT ALL OUR EXPERIENCES TOGETHER AND CAME TO THE FOLLOWING 10 TIPS FOR BUSINESS MODEL INNOVATION. TIP# 1 ENJOY BUSINESS MODELING! BE A DESIGNER! TIP# 2 56

57 KILL YOUR DARLINGS TIP# 3APPLY FRESHWATCHING LEARN FROM OTHER BUSINESS MODELS! TIP# 4 57

58 GENERATE OPTIONS THE SINGLE RIGHT SOLUTION DOES NOT EXIST THE PAST WAS ABOUT CHOOSING SOLUTIONS THE FUTURE IS ABOUT GENERATING OPTIONS TIP# 5 PROTOTYPING LET S YOU FAIL EARLY TO SUCCEED SOONER IDEO.COM 58

59 TIP# 6DISRUPT BEFORE YOU ARE BEING DISRUPTED TIP# 7 SHOW ME THE MONEY! 59

60 TIP# 8 DRAWING IS THE NEW WRITING THINK & WORK VISUALLY! DESIGNING BETTER BUSINESSES TIP# 9DON T RELY ON YOUR ASSUMPTIONS. 60

61 TIP#10 GET OUT OF THE BUILDING AND TEST! JUST DO IT! THE BUSINESS MODEL CANVAS USE THE BUSINESS MODEL CANVAS ;-) 61

62 BE A REBEL DESIGNBETTERBUSINESS IDEATE UNDERSTAND POINT OF VIEW DESIGNING BETTER BUSINESSES WORK LIKE A START-UPS VALIDATE PROTOTYPE WHAT ARE YOUR KEY SKILLS? START WITH THE CUSTOMER 62

63 ASK QUESTIONS CREATE OPTIONS EXPERIMENT DESIGNING BETTER BUSINESSES WORK VISUALLY TO CREATE A COMMON LANGUAGE WITH STRATEGIC DESIGNING BETTER TOOLS BUSINESSES 63

64 TO CREATE CERTAINTY AROUND STRATEGY GRAB THE OPPORTUNITIES OF UNCERTAINTY CEO VERSUS CSO I AM A F*** REBEL DESIGNBETTERBUSINESS 64

65 DESIGNBETTERBUSINESS 65