BUSINESS MODELLING WORKSHOP
BRIEF INTRO
Who we are
What we want to achieve
What are we expecting/looking for
THE STARTING POINT
Stating something obvious
Every customer has a problem,
every problem has a solution
Not every solution has a problem
Not every problem has a customer
And context evolves quickly:
▪ Markets
▪ Needs, behaviors and expectations
▪ Technologies
Source: FET2RIN project
Without a customer WILLING TO PAY for your solution, you are condemned to fail
THE STARTING POINT
From Investopedia
“A business model is a company's plan for how it will generate revenues and make a profit. It
explains what products or services the company plans to manufacture and market, and how it
plans to do so, including what expenses it will incur”
Definitions
BUSINESS MODEL – SOME EXAMPLES
The bricks and clicks business model – Business model which integrates both offline (bricks) and
online (clicks) presences
The direct sales business model – Direct selling is marketing and selling products to consumers
directly, away from a fixed retail location
Franchise – Franchising is the practice of using another firm's successful business model (the
franchisor build the brand, the production and delivery model, the value proposition, … and the
franchisee contributes to building the chain of stores
The freemium business model – Business model that works by offering basic Web services for free,
while charging a premium for advanced or special features
BUSINESS MODEL – SOME EXAMPLES
The razor and blades business model – It is a business model where one item is sold at a low price
(or given away for free) in order to increase sales of a complementary good, such as supplies
The subscription business model – It is a business model where a customer must pay a subscription
price to have access to the product/service (and pays different prices for different packages)
The utility or pay-as-you-go or on-demand business model – It is a business model based on
metering usage
The flat rate business model – A single fixed rate fee for a product or service is charged, regardless
of actual usage or time restrictions, while the company benefits from a constant revenue stream
The add-on business model – It is a business model where the core offering is priced competitively,
but there are numerous extras that drive the final price up
BUSINESS MODEL – SOME EXAMPLES
The experience selling business model – The value of a product or sevice is increased with the
customer experience offered with it
The hidden revenue business model – This concept facilitate the ideas of separation between user
and customer
The layer player business model – A layer player is a specialized organisation limited to the provision
of one value-adding step for different value chains
The open source business model – The source code of a software product is not kept proprietary,
but it is freely accessible (partially or totally) for anyone, the benefit is the contribution provided by
third parties to the improvement of the product/service
BUSINESS MODEL – SOME EXAMPLES
The white label business model – A white label producer allows other companies to distribute its
goods under their brands, so that it appears as if they are made by them
The trash-to-cash business model – Used products are collected and either sold in other parts of the
world or transformed into new products
WHAT OTHER BUSINESS MODEL IS ALREADY UNDER DEVELOPMENT?
DEFINING THE BUSINESS MODEL
Knowing the problem
▪ What are the requirements
▪ What are the functionalities
▪ What are the core features
The traditional approach to innovation
Knowing the solution
▪ How to implement it
▪ How to deliver it
▪ How to maintain it
The context evolves quickly
HIGH RISK of wasting time and
resources
TOP DOWN
APPROACH
DEFINING THE BUSINESS MODEL
From Wikipedia
“Lean startup is a methodology for developing businesses and products, which aims to
shorten product development cycles by adopting a combination of business-hypothesis-driven
experimentation, iterative product releases, and validated learning. The central hypothesis of
the lean startup methodology is that if startup companies invest their time into iteratively
building products or services to meet the needs of early customers, they can reduce the
market risks and sidestep the need for large amounts of initial project funding and expensive
product launches and failures”
Eric Ries, The lean Startup (2008), Ash Mayura, Running Lean (2012)
Definitions
THE BUSINESS MODEL CANVAS
The Business Model Canvas is a
strategic management template
invented by Osterwalder and Pigneur
for developing new business models
or documenting existing ones
It is a visual chart with elements
describing a firm's value proposition,
infrastructure, customers, and
finances. It assists firms in aligning
their activities by illustrating potential
trade-offs
UNDERSTAND THE PROBLEM FIRST AND DEFINE THE SOLUTION AFTERWARDS
The Lean Canvas is a version of the
Business Model Canvas adapted by
Ash Maurya specifically for startups
The Lean Canvas focuses on
addressing broad customer problems
and solutions and delivering them to
customer segments through a unique
value proposition
UNDERSTAND THE PROBLEM FIRST AND DEFINE THE SOLUTION AFTERWARDS
Understanding the problem implies the need to interact with your potential clients and
discuss/explore what are the problems they face – the focus should be the problem NOT the
solution
▪ What is “his/her” problem
▪ Who is “he/she”
▪ How does he/she solve the problem now
▪ Is our product more efficient in solving this issue?
Exploring the market and discussing the problems and issues with potential clients implies
leaving the office/lab and interviewing them
UNDERSTAND THE PROBLEM FIRST AND DEFINE THE SOLUTION AFTERWARDS
INNOVATION
PRODUCT
INFORMATION
The virtuous cycle of market-
oriented innovation
VALUE PROPOSITION CANVAS
The Value Proposition Canvas
matches on the one hand the
customer profile (the set of customer
characteristics that you assume,
observe and verify in the market) with
on the other hand the value map (the
set of value proposition benefits that
you design to attract customers)
CUSTOMER DRIVEN INNOVATION
PRODUCT DRIVEN INNOVATION
Q & A
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