A few years back, many organisations jumped on the social media (read Facebook) bandwagon. But few actually reflected on what business outcomes they could expect from such a move. For example by asking themselves: What does success look like?
Some time later, the same businesses were disillusioned. As they did not observe any return on their investment, they came to the conclusion that online marketing was just another hype. Why Swiss SME’s are reticent to embrace digital marketing.
This is a shame, because finding quality leads and customers online does work – provided you have a sound business model and a smart, digital (content) marketing strategy.
Are you detached enough?
Right now, I’d like you to find a cloud high high up in the sky – and sit on it.
This is a rare moment when you get the chance to look at your business in an aloof and detached way. Imagine a gentle breeze, refreshing, tonifying, clearing your mind of all unnecessary clutter.
What do you see?
Your business is successful right now. But you observe that customer acquisition is getting a little harder every quarter.
And you’re left wondering how you could get more quality leads, without needing to squeeze your already busy colleagues, or hire new staff, with the inevitable hit on your budget.
To add to your unrestfulness, you observe a new set of competitors who joined your market space a few months back.
You’ve noticed that they they’re very active online and, in fact, just last night your supplier and good friend John told you that they’re hiring!
At three in the morning, when you’ve woken up because of a noise, you find it’s difficult to get back to sleep. Are these competitors threatening your existing customer base?
You have loyal customers who are your best ambassadors. They’re also the first to buy from you, when you have a new product or service.
But are you making the best out of your existing customer relationships ?
Everyone is just so busy in your company.
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Time to act.
1. Business Model Canvas and Value Proposition Design are techniques that help you look at your business in a new way. One of the major advantage of these tools is that they are visual and hence make sharing and explaining easy. Capturing people’s attention in a seemingly playful way is a great plus when you need to seek advice about the complex challenges you face.
2. As you’re reading these lines, you’re at a convenient place. Please have a quick look at the website whose link I am listing in the previous paragraph. Then take a moment and read through the 5 steps here below. These illustrate how you can make a first portrait of your company without needing to call in expensive consultants. The example we use is Le Cirque du Soleil – an amazing story of business transformation that merits its own separate article.
3. At the end of this blog post, I provide more resources, downloads and links to help you get familiar with these new techniques so that you can proactively manage your business strategy.
Before we go any further, let me say that neither I personally nor my company profits from recommending the above tools. There’s no hidden agenda nor any affiliate link. However, based on my positive experience I have created the Geneva Lean Startup Group. This is a growing community of >600 entrepreneurs who are offered monthly hands-on workshops, durich which we teach the proposed techniques.
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An example to help you understand. Make a portrait of your current business model, in 5 simple steps.
One of the most valuable actions you can take right now is to describe the current business model of your company. By understanding what you have today, you give yourself and your organisation the opportunity to create new strategic alternatives.
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Indeed, in an age where many certainties are challenged: think of the music, newspaper and travel industries – we must avoid becoming victims of our success. It pays to be smart for our businesses: by continuously scanning the landscape and assessing our industry and our strategy.
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To make a portrait of your business, reserve one quiet hour this evening to do a dry run, together with me.
If you like the approach, I recommend you repeat the process with your own team. I provide links to useful resources in the end chapter entitled Resources, downloads and links to proactively manage your business strategy.
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Start with these 5 steps.
Step 1
Download the free Value Proposition Design Canvas and Business Model Canvas. These documents are released under the Creative Commons license.
PS regarding the license: Anyone may use the canvas for their own work or to support others in understanding, analysing or changing their business models. This includes people who use the tool within their own companies or in a consulting capacity. The requirement is full identification and credit of the source of the tool. The source is Strategyzer.com.
Print several copies in A3 if possible, otherwise A4 will do.
Make sure you have Post-it® notes handy.
Photo Credit: stuffinjello on Photobucket
Post-it® notes function like idea containers that can be added, removed, and easily shifted between business model building blocks. (They’re going to be particularly useful for exploratory discussions with your team, when some elements might be removed and replaced multiple times, to explore new ideas)..
Step 2
Click on the image to watch this 4 minute video for a quick explanation of the Value Proposition Design canvas.
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Step 3
Make sure you have the printed document in front of you or pinned to a wall. When you’re ready, play the short animated presentation. I’ll walk you through the 9 building blocks of the Business Model Canvas.
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Step 4
Now that you have an overall idea, let’s take Cirque du Soleil as an example. The description and illustration are copied from page Page 228 and 229 of the Business Model Generation book.
Example: The Cirque du Soleil Business Model.
PS: The text here below is a direct quote from the Business Model Generation book.
The Business Model Canvas lets you systematically analyze a business model innovation in its entirety. You can ask the Four Actions Framework questions (eliminate, create, reduce, raise) about each business model Building Block and immediately recognize implications for the other parts of the business model, e.g. what are the implications for the cost side when we make changes on the value side? and vice versa.
Cirque du Soleil features prominently among Blue Ocean Strategy examples. Below we apply the blended Blue Ocean and Business Model Canvas approach to this intriguing and highly successful Canadian business.
First, the Four Actions Framework shows how Cirque du Soleil “played” with the traditional elements of the circus business Value Proposition. It eliminated costly elements, such as animals and star performers while adding other elements, such as theme, artistic atmosphere, and refined music.
This revamped Value Proposition allowed Cirque du Soleil to broaden its appeal to theatergoers and other adults seeking sophisticated entertainment rather than the traditional circus audience of families.
As a consequence, it was able to substantially raise ticket prices. The Four Actions Framework, outline in blue and gray in the business model canvas above, illustrates the effects of changes in the Value Proposition.
Click on the image to view a bigger format.
Step 5
Now that you’ve observed the train of thought, have a first go at sketching out the different elements of the canvas for your own business. Make sure not to write on the canvas itself, use the Post-it® notes instead.
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Resources, downloads and links to proactively manage your business model.
If you liked the dry run, your next step could be a team session to assess your current situation and brainstorm new opportunities. Best is to start out simple and as you evolve, get help: buy the book, download more resources and seek coaching or training.
Buy
Value Proposition Design & Business Model Generation.
These books take you by the hand and lead you through each step in a detailed and clear way. The accompanying illustrations are enjoyable and make for an easy and agreeable read.
http://www.businessmodelgeneration.com/book/order
German, French, Spanish, Chinese, Russian, check for other languages here.
Download
– The Value Proposition Design and Business Model Canvas: http://www.businessmodelgeneration.com/canvas
– A 72-page review of the Business Model Generation book
http://www.businessmodelgeneration.com/book – Watch out for this icon:
Read the Harvard Business Review article.
Creating an entrepreneurial, innovation-based economy. An excellent article, available in Harvard Business Review, May 2013.
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Training & Coaching
Please contact me or leave a comment here below if you’d like advice and/or individual & group training about Value Proposition Design and Business Model Generation. We’re a complementary team of successful business owners, entrepreneurs and digital marketers who have initiated many training workshops around the above topic. We not only talk, but use these techniques to address our own professional challenges.
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Still keen? Here’s a BONUS!
The Silly Cow Exercise – 3 minutes.
Ask your colleagues to sketch out three different business models using a cow.
First, they should define the characteristics of a cow, for example: produces milk, eats all day, makes a mooing sound, etc.
Then they must use those characteristics to come up with an innovative business model (based on a cow). For example, Value Proposition=Lawn-Mower-Combined-Fertilizer.
The goal is to take people out of their day-to-day business routines and show them how readily they can generate ideas by disconnecting from orthodoxies and letting their creativity flow.
Enjoy!
Photo credits:
Header Image Creative Commons License. With thanks to steve-c-photo.fr
PS: We’ve cropped the black spaces on top and bottom of photo.