Business Model Canvas

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Business Model Canvas by Mind Map: Business Model Canvas

1. Designing the Business Model

1.1. Design patterns

1.1.1. Unbundling Business Models examples Private Banking Unbundling the Telco Business Types Operational excellence Customer intimacy Product leadership

1.1.2. The long tail Coined by Chris Anderson In media industry, shift from selling many of few items to selling few of many items Made possible by Selling less of more Focus on offering a large number of products which sells infrequently Aggregate of all infrequent sales of large number of items can be more than selling many of a few items Requires Customer segment of ONE 20% of sales from 80% of items Selling more of less items - Traditional 80% of sales from 20% of items examples Book publishing industry Lego's new long tail Business Model Canvas Customer Segments Revenue Streams Cost Structure

1.1.3. Multi-sided platforms brings together 2 or more distinct but interdependent groups of customers Platform of valkue to one group only if the other groups are present platform creates value by facilitating interactions between diff groups platform grows in value to the extent that it attracts more users known as network effect examples Visa Google Apple eBay MS Windows Financial Times Free newspaper Wii Game console Xbox/PSP Facebook dilemma chicken or egg questions

1.1.4. FREE as a business model definition at least one substatial customer segment is able to continuously benefit from a free-of-charge offer. non-paying customers are financed by another part of the business model or by another customer segment patterns free-offer based on multi-sided platform free basic services with optional premium initial free-offer leads into repeat purchases

1.1.5. Open Business Model definition create and capture value by systematically collaborating with outside partners outside-in inside-out examples P&G Connect and develop GSK's Patent pools The connector:Innocentive

1.2. Design Thinking

1.2.1. Customer insights Personalize her what does she What are her

1.2.2. Ideation Divergent Generation Convergent Synthesis epicenters of BM innovation Resource driven Offer driven Customer driven Finance driven Multiple-epicenter driven Process 1 Team composition 2 Immersion 3 Expanding 4 Criteria selection 5 Prototyping Brain storming Stay focused Enforce rules Think visually Prepare

1.2.3. Visual thinking

1.2.4. Prototyping Napkin sketch Elaborated canvas Business case Field test

1.2.5. Storytelling

1.2.6. Scenarios

1.3. Strategy

1.3.1. Business Model environment FORESIGHT Key Trends COMPETITIVE ANALYSIS Industry forces MACROECONOMICS Macro-economic forces MARKET ANALYSIS Market forces How Business Model Changes over time

1.3.2. Evaluating Business Models example Assessment in 2005 Opportunities explored in 2006 SWOT How SWOT impacts Business Model Evaluation Internal External How to use

1.3.3. Business model perspective on Blue Ocean Strategies Blue Ocean Strategy is about creating completely new industries through fundamental differentiation as opposed to competing in existing industries by tweaking established models. Rather than outdoing competitors in terms of traditional performance metrics, Kim and Mauborgne advocate creating new, uncontested market space through what the authors call value innovation. This means increasing value for customers by creating new benefi ts and services, while simultaneously reducing costs by eliminating less valuable features or services. Notice how this approach rejects the traditionally accepted trade-off between differentiation and lower cost. Four Actions Framework 1. Which of the factors that the industry takes for granted should be eliminated? 2. Which factors should be reduced well below the industry standard? 3. Which factors should be raised well above the industry standard? 4. Which factors should be created that the industry has never offered? Blending with Business Model Canvas Blend Examples Nintendo Wii Example Cirque de Soliel example Blue Ocean Steps The combination of Blue Ocean Strategy tools and the Business Model Canvas provide a solid foundation upon which to question your business model from value creation, customer, and Cost Structure perspectives.

1.3.4. How to manage multiple business models Integrated SMH - Swatch Separated Nestle - Nespresso Daimler Car2Go - unsure Untitled

1.4. Design Process

1.4.1. Mobilize

1.4.2. Understand

1.4.3. Design

1.4.4. Implement

1.4.5. Manage

1.4.6. Motivation for Business Model Design Startup Satisfy market Bring to market Improve market Create market Challenges Established Reactive Adaptive Expansive Pro-active/explorative Challenges

1.4.7. Design attitude Traditional Easy to come up with alternatives but difficult to choose one Design attitude Difficult to design outstanding alternatives but easy to decide on the right one

2. Other issues

2.1. Business models beyond profit

2.2. Computer-aided business model design

2.3. Business models and Business plans

2.4. Implementing business models in new or existing organisations

2.5. Achieve better business model and IT alignment

3. Revenue stream

3.1. Asset sale

3.1.1. selling ownership rights to a physical product

3.2. Usage fee

3.2.1. pay as you use

3.3. Subscription fees

3.3.1. selling continuous access to a service

3.4. Lending/Renting/Leasing

3.4.1. temporarily granting someone the exclusive right to use a particular asset for a fixed period in return for a fee

3.5. Licensing

3.5.1. giving customers permission to use protected intellectual property in exchange for licensing fees

3.6. Brokerage fees

3.6.1. intermediation services on behalf of 2 or more parties

3.7. Advertising

3.7.1. fees for advertising a specific brand, product or service

3.8. Pricing mechanisms

3.8.1. Fixed menu pricing list price Product feature dependent ustomer segment dependent Volume dependent Predefined prices are based on static variables

3.8.2. Dynamic pricing Negotiation Yield management Real-time market Auctions Prices change based on market conditions

4. Customer relationships

4.1. definition

4.1.1. types of relationships company establishes with customer segments

4.2. types

4.2.1. Personal assistance The Body Shop

4.2.2. Dedicated personal assistance Doctor

4.2.3. Self service supermarket

4.2.4. Automated services Citibank Telkomsel

4.2.5. Communities network

4.2.6. Co-creation invites customers to build content for other customers benefit

5. Key resources

5.1. definition

5.1.1. the most important assets required to make a business model work

5.2. Types

5.2.1. Physical

5.2.2. Intellectual

5.2.3. Human

5.2.4. Financial

6. Customer Facing Brain: Emotion, Creativity Creating Value

6.1. Customer Segments

6.1.1. definition different groups of people or organisations

6.1.2. types Mass market Anyone, all markets, One undifferentiated group Niche market one specific specialized customer segments Segmented market segments with Diversified chunks of market segments that have totally different needs and problems Multi-sided markets 2 or more interdependent customer segments

6.2. Channels

6.2.1. definition how a company communicates with and reaches its customer segments to deliver a value proposition

6.2.2. interface with customers thru communications distribution sales

6.2.3. Mix Partner's channels indirect Own Channels direct indirect Both

6.2.4. Phases Raising awareness Helping customers evaluate the company's value proposition Allowing customers to purchase specific products and services Delivering the Value proposition Providing post purchase customer support

6.2.5. find great customer experience maximize revenues

6.2.6. channel choice

7. The Canvas

7.1. Value Proposition

7.1.1. Definition is a bundle of For <target customer> sample For For

7.1.2. Levels weak Nice to have medium Must have strong Shadow cost

7.1.3. Types Newness Performance Customization Design Brand Price Cost or Risk reduction Accessibility Usability

7.2. Infrastructure Brain: Logic Efficiency

7.2.1. Key activities definition most important thing to make its business model work Types Production Problem solving Platform/Network

7.2.2. Key partners definition network of suppliers and partners that make the business model work purpose optimize business model and economy of scale reduce risks acquire resources Types Strategic alliances between non-competitors Coopetition: Strategic partnerships between competitors Joint ventures to develop new businesses Buyer-supplier reltionships to assure reliable supplies Commitments and obligations

7.2.3. Cost structure definition all costs incurred to operate the business model pick most important costs incurred while operating under a particular business model all these incur costs creating and delivering value maintaining customer relationships generating revenue Types Cost-driven Value driven Fixed costs Variable costs Economies of scale Economies of scope