Sunday, July 21, 2013

Business Model Generation, Alexander Osterwalder & Yves Pigneur

"Brainstorming for business models"
“Business model” has always been an obscure thing for me. Of course, I knew that a business model is the “how an organization creates, delivers, and captures value”, but this remained quite obscure to me. The book of Osterwalder and Pigneur makes a great step in putting some light on the “business model” concept. This is firstly done by defining a canvas, which describes the components of a business model, then giving a set of interesting patterns (templates), which are complemented by very clear and interesting market examples.
Model / Concepts
The main model is the “business model canvas”:
  • Key Activities: The most important activities in executing a company's value proposition.
  • Key Resources: The resources necessary to create value for the customer.
  • Key Partners: Buyer-supplier relationships permitting focusing on their core activity.
  • Value Proposition: The collection of products and services a business offers to meet the needs of its customers. Characterized by newness, performance, customization, design, brand, price, status, risk reduction, convenience/usability.
  • Customer Segments: Mass, niche, segmented, diversified, multi-sided
  • Channels: Direct/ indirect. Phases: awareness, evaluation, purchase, delivery, after sales.
  • Customer Relationship: Personal, dedicated personal, self-service, automated services, communities.
  • Cost Structure: Cost-driven, value-driven, fixed-cost, variable costs, economy of scale/scope.
  • Revenue Streams: Asset sales, usage fee, subscription fee, lending/renting/leasing, licensing, brokerage fee, advertising. Fixed pricing vs. dynamic pricing.

This is the weak point: It’s not easy to generate a direct impact for a company. In my case, it has been very helpful to better structure the business plan and also to better communicate it, but then it’s over. Probably the impact is more important in larger companies, where there are a lot of people in charge of the business model.
  • rating Amazon - 4.5/5.0 (268 reviews)
  • my rating - 4.0/5.0
  • fun factor - 4.0/5.0
  • simplicity - 5.0/5.0
  • impact - 3.0/5.0

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