A One-Page Method For Reinventing Your Business Model
When you’re starting a new project or a new company you need quick and efficient tools to help you focus on executing things faster and better. The Business Model and Value Proposition Canvas is a simple tool that quickly gets you to the ‘minimum viable clarity’ required to start building, testing and understanding in one simple page how your business works.
For many startups, using these tools can help them develop a clear view of their value proposition, operations, customers and finances. As a small-business owner, you can use it to identify how the different components of your business relate to each other. That’s powerful when deciding where you need to focus your attention as you slowly grow your business. On the 28th of June 2016 at the Desjardins Lab was held a conference by eCOM MTL where Yves Pigneur, professor at HEC Lausanne discussed how to conceive a Business Model that creates value for your business.
For many in the business world, Yves Pigneur, the co-author of the “Business Model Generation” and “Value Proposition Design” is the reference in terms of creating a Business Model and Value Proposition.
The first model discussed during the conference, the Business Model Canvas is a strategic management and entrepreneurial tool that allows you to describe, design, challenge, invent, and pivot your business model. The latter can be described using 9 basic building blocs: customer segments, value propositions, channels, customer relationships, revenue streams, keys resources, key activities, key partnerships and cost structure. However, it not sufficient to roughly enumerate these blocs, in fact, business must map them out on a structured canvas. These blocs must be used in coordination with one an other and not play the role of a check list. You can click on this link to download the canvas and start planning!
The main objective of this canvas is to fill out the boxes with information relevant to your organization to map out your entire Business Mode. This works for beginning entrepreneurs just as for senior executives.
According to Pigneur, prototyping plays a major role. Two fun practices illustrated during the conference:
- Use a color code to visually show associations between different elements.
- Draw connecting lines between boxes to show existing links.
The second canvas model, Value Proposition, is a plug-in to the previous model. The tool is based on two elements; the customer segment whom you intent to create value for and the value proposition, which you believe will attract customers. The customer segment profile describes the characteristics of your customers: customer job they are trying to get done in their lives, related pain outlining the negative aspects they will want to avoid and gains translating the benefits customers will like to have from using the product or service.
On the hand side, the Value Proposition Map, which you are designing to address your customer profile. This section includes the products and services, the pain reliever outlining your offers that alleviate customer pain and the gain creators describing the benefits your produce for your customers. This part of the model answers the problems illustrated in the other part.
As we’ve seen, your business model can truly make the difference between world-leading success and dismal failure. However, they widely remain poorly understood even thought they transform the framework in competitive settings. Disruptive business models are an emblematic figure in this generation. These two models will give you the base line to design, test and deliver what customers want and leverage on existing assets.
I highly recommend your read these two books before planning your Business Model!
Have you used these Canvases in your strategic planning? Did you find them useful? Please comment to let us know!