Empowering New Business It s all about Strategy! Business Model Configuration Workshop part 1
Overview part 1 // Strategy // Direction, Future and Sustainability // Advantage & Environment // Understanding the Business // Business Models // Customer Segments // Value Propositions // Distribution Channels Overview part 2 // Business Models continued // Customer Relationships // Partner Network // Key Activities // Key Resources // Revenue Streams // Cost Structure // Example Business Model // Try it yourself! // References & Contact Details
It s all about Strategy // Strategy is the direction and scope of an organization over the long term: which achieves advantage for the organization through its configuration of resources within a changing environment, to meet the needs of markets and to fulfill stakeholder expectations. Source: Johnson and Scholes (2002)
Direction //What s your ambition and vision? Long term //And what about the future?
Have you thought about Sustainability?
Advantage & Environment //Please look outside you re not alone!
Direct and Indirect Action Environment Advantage & Environment //Please look outside you re not alone! Socio-cultural Environment Suppliers Technological Environment Competitors Company Complementors Political Environment Customers Source: Robben & Moenaert (2008) Economic Environment
Advantage & Environment //Please look outside you re not alone! Customer Process Product / Service Image Price The CODA (Customer s Outlook on Differentiating Advantages) // What do you offer? // How and where do you offer it? // What are the costs to the customer? // What do you represent? Source: Robben & Moenaert (2008)
Understanding the Business // What do you offer? // How and where do you offer it? // What are the costs to the customer? // What do you represent? How do you do that? Moenaert & Robben
Business Models Stories that explain how enterprises work // A good business model begins with an insight into human motivations and ends in a rich stream of profits. Source: Magretta (2002)
Partner Network The partners and suppliers we work with Key Activities The most important activities performed to implement our business model Key Resources The key resources on which our business model is built Cost structure The costs we incur to run our business model Value Proposition The bundles of products and services that satisfy our customer segment s needs Customer Relationships The types of relationships we entertain with each customer segment Distribution Channels The channels through which we communicate with our customers and offer our value proposition Customer Segments Our group of customers with distinct characteristics Revenue streams The streams through which we earn our revenues from our customers for value creation and customer facing activities The Business Model Canvas // Which story are you telling? Source: Osterwalder & Pigneur: Business Model Generation (2010)
The Business Model Canvas // The building blocks Partner Network Customer Relationships Key Resources Value Proposition Customer Segments Key Activities Distribution Channels Cost structure Revenue streams
Customer Segments // For whom are we creating value? // Who are our most important customers? // Who pays?
Customer Segment Examples // Mass Market // Niche Market // Segmented // Diversified // Multi-sided Platform
Customer Segment Examples // Mass market // Niche markets // Diversified // Segmented // Multi-sided platform
Customer Segment Questions // Do we know our customers and their needs good enough? // Are some customer groups likely to defect soon? // Do we regroup different customer segments well enough?
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?
Value Proposition Characteristics // Newness // Performance // Customization // Getting the Job Done // Design // Brand/Status // Price // Cost Reduction // Risk Reduction // Accessibility // Convenience/Usability
Value Propositions Questions // Does our value proposition still cater well enough to our clients needs? // Do we know how our customers perceive our value proposition? // Are our competitors offering similar value propositions at similar or better prices? // How well are our customers served by other competitors?
Distribution 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?
1. Awareness 2. Evaluation 3. Purchase 4. Delivery 5. After sales // How do we raise awareness about our company s products and services? // How do we help customers evaluate our organization s Value Proposition? // How do we allow customers to purchase specific products and services? // How do we deliver a Value Proposition to customers? // How do we provide postpurchase customer support? Distribution Channel Phases
Distribution Channels Questions // Do we have a well thought-through communication and distribution channel design? // How well do we reach our clients? // Do we know how successful our channels are in terms of customer acquisition? // How well are our different channels integrated? // Do we know how cost efficient are our channels are? // Do we use the right channels for the right clients (e.g. in terms of profitability)? End of part 1
References // Gulati, R. (2009). Reorganize for Resilience. Boston: Harvard Business School Publishing. // Johnson, G., & Scholes, K. (2002). Exploring corporate strategy. Harlow: Financial Times Prentice Hall. // Moenaert, R., Robben, H., & Gouw, P. (2009). Marketing, strategy & organization (4th ed.). Leuven: LannooCampus. // Osterwalder, A., & Pigneur, Y. (2009). Business Model Generation. Deventer: Kluwer. // Image courtesy of FreeDigitalPhotos.net