The Business Model Canvas: A Good Tool with Bad Instructions?
Alexander Osterwalder’s Business Model Canvas is widely used by entrepreneurs around the world. It is a good tool. However, the Business Model Canvas is not great because it does not explicitly focus on solving the pain of stakeholders. The Business Model Canvas is solution (value proposition)-focused rather than pain (problem)-discovery, learning, and elimination focused. The Business Model Canvas is driven by the Value Proposition, which assumes that a stated Value Proposition is the desired solution to the pain of the stated targeted customer. In short, the Business Model Canvas is not a direct tool for comprehensive pain (problem) discovery, learning, and solving. The Business Model Canvas also lacks inherent focus on a process for experimentation, prototyping, and execution of projects.
The Business Model Canvas was not developed as a tool for facilitating application of the paradigm of Pain Discovery, Learning, and Elimination, which is reminiscent of the “scientific method for discovering and solving problems.” Rather, the Business Model Canvas was originally conceived as a ‘scorecard’ for visually documenting a business model. Consequently, the Business Model Canvas is ‘time agnostic:’ it can be used for documenting past, present, and future business models. In theory, the Business Model Canvas is a visual synthesis of topics for comprehensively describing a business model or project and its impacts.
Recognizing the deficit of the Business Model Canvas with regard to pain (problem) discovery and solving, several practitioners have tried to modify or “patch” it as well as add complementary tools and processes. In his Customer Development Stack, Steve Blank adds the process of Customer Development to facilitate pain discovery. He also adds Agile Development (Lean Startup) Method to facilitate experimentation and testing of hypotheses from a “Future (Hypothetical) Business Model Canvas.” Even Osterwalder himself has developed the tool of “Value Proposition Canvas” to augment the pain (problem) discovery and solving capability of the Business Model Canvas.
Ash Maurya has modified building blocks of the Business Model Canvas to suit the mindset and language of “Lean Startup” entrepreneurs as well as directly include the paradigm of pain (problem) solving. Maurya includes building blocks such as for “Problem,” “Solution,” and “Key Metrics.” However, Maurya’s building blocks such as “Unfair Advantage” violate the visual system logic of the Business Model Canvas.
To date, many entrepreneurs are busy and sometimes, mindlessly completing building blocks of the Business Model Canvas without a clear pain (problem) solving process. The Build-Measure-Learn Loop of the Lean Startup Method can be used with the Lean Canvas. However, to date the Lean Startup Method which includes the process of “Innovation Accounting” has not been seamlessly integrated with the logic and building blocks of the Business Model Canvas. Without ‘proper’ instructions, entrepreneurs the world over have been ineffectively using the Business Model Canvas. The result is enormous waste of money, energy, and time while trying to rapidly discover and solve the pain of stakeholders especially customers. So, what are we to do?
This article introduces the Pain-Plan-Do-Review (PPDR) Cycle which can be used with or without the Business Model Canvas. Housing the PPDR Cycle is the Community Happiness Canvas which presents a Pain Solving Question (PSQ) that is answered by using 9 topics of LIST: List of Innovate Salone Topics. The LIST largely consists of topics from GMin’s application form of applicants to the community innovation program for school-going students in Sierra Leone, Kenya, and South Africa. Dozens of innovation projects have been successfully completed using the structure and content of the LIST. Unique features of the LIST include its consideration of the topics of “Problem/Challenge/Pain” and “Other Solutions.” Further, topics of the LIST inherently reflect the iterative paradigm of Pain Discovery, Learning, and Elimination.
The above presentation shows correspondences between topics of the Business Model Canvas and Community Happiness Canvas. The Community Happiness Canvas is a visual platform that can be used to “plug-and-play” any business tool including Brainstorming, Design Thinking, Customer Development, the Business Model Canvas, Lean Canvas, and Lean Startup Method. The Community Happiness Canvas therefore provides a universal visual language for all pain solvers: Brainstormers; Design Thinkers; Marketers; Business Modelers; Entrepreneurs; Managers; Executives.
By using the PPDR Cycle of the Community Happiness Canvas in conjunction with the topics of the Business Model Canvas, entrepreneurs can rapidly solve the pains of stakeholders especially customers. By solving widely experienced pains at a price that targeted customers can afford, entrepreneurs can rapidly build profitable business models that can scale. A simpler or more organic approach to incorporate “pain solving thinking” while using the Business Model Canvas is to initially pose a Pain Solving Question (PSQ) which is in the format of: “How Might We Eliminate Pain (HMWEP) of ‘X’?” The symbol “X” represents any of the 9 building blocks as well as any element in the Business Model Environment.
Every time an experiment or testing of a business model hypothesis is completed, the entrepreneur should check whether a targeted pain has been eliminated. Thereafter, the entrepreneur must decide whether to persevere with reducing the targeted pain or to pivot to another pain for elimination. A Pain Solving Question simply provides a framework that justifies iterative pain solving while using the Business Model Canvas.
So, what do you think?
