Business Model Canvas 2.0

Proposing a change to the Holy Grahl of Lean Start-Up methodology is quite risky… but I hope you will like…

Dear Fellow Innovator,

Business Model Canvas today is the base of any Start-up and most of business initiatives.

Alexander Osterwalder has crafted it in 2008 providing all of us with a great tool to describe a business idea in a simple and effective way.

Its 9 blocks are really a guide in analyzing:

- “why” a Customer should buy your value proposition
- “how” your value proposition will reach your Customer
- “what” you need to make it happen

and the cost / revenues sources that will make your business run.

they are:

1 — Customer Segments
2 — Channels
3 — Customer Relationships
4 — Value Propositions
5 — Key Activities
6 — Key Resources
7 — Key Partners
8 — Costs Structure
9 — Revenues Streams

You can find a lot of books explaining the 9 blocks and how to use them,

However, every time I see wanna-be Entrepreneurs trying to apply it,

I see minds wandering in space.

So I want to try to help with a couple of recommendations
and a slight modification to the “holy Canvas” of Entrepreneurship
that comes from few years of experience as Marketeer and as Business Process re-Engineer.

Recommendations:

1) Start with “Customer”

No Customer — No Party. You may say what you want, but “Business follows Relationship”.
and if you do not “have” a Customer, you cannot even think of doing business.

If you have a look at the yellow picture of the Canvas I put in the heading,
the number “1” is in the “value proposition” block.

This yellow canvas is “borrowed” from a Steve Blank* presentation.
So moving that “1” in another block, it’s quite a bold move…I recognize,
But my experience is that: when you start describing your Customer,
all the following blocks come easy.

2) Go on with “Problem”

Ok, “Problem” is not an official block of the Canvas,
but it’s the core of the “Value Proposition” block.

I am used to say to my Clients that “Problem” is the block
written full page on the reverse side of the canvas.

If you can articulate the problem (and here a bit of classic marketing tools may help), to talk about the “Value Proposition”, comes much easier.

Modifications:

So far for the easy part.

Now let’s talk about the slight modification I want to propose.
(Osterwalder, please, I beg your pardon…)

As someone of you knows, I have done this “doubleface” career path
that make me think Marketing as a Process guy
and Business Processes as a Marketing guy

The result is that every time I approached the Business Model Canvas
my schizophrenia was pumped to stars, causing me a lot of headaches.

My “Marketing-me” loved the Canvas at first sight.
My “Process-me” was unable to stare at it.

My “Process-me” was striving to find simmetry and directions in it
but everything conjured against both of them.

For what concerns directions,

I told you above that the problem was the starting point.
As a seasoned project manager, I am used to think “R2L” — Right to Left:
i.e. from “Customer” to “Resources”.
Moving the “1” to the “Customer” block
helped a lot to build again a R2L rythm into the Canvas.

But much more helped moving the “Key Resources” block
to the extreme left, in place of the “Key Partners” block.

Now you can read the canvas Left to Right almost as a classic
Porter’s “Value Chain”: where “resources” are the foundation of your
business process.

But “simmetry” was reeeealy a nightmare.

Till I noticed that the blocks were perfect, but in the “wrong” place.

“Wrong” I mean, (with all due respect to Osterwalder) compared
the two key organizational models used in any business organization
already running on Earth:

A) Taylorism — or co-ordination of activities
B) Mayo-ism — or co-laboration as a form of human relationship**

If you draw a red line from R2L across the upper part of the canvas
You will notice that the remaining blocks are kind of “reversed”

Try reading the blocks in this way:

Key Activities → it’s a matter of co-ordination — processes — Taylor
Key Partners → it’s a matter of co-laboration — relationship — Mayo

while:

Customer Relationships → it’s a matter of co-laboration — relationship — Mayo
Channels → it’s a matter of co-ordination — processes — Taylor

Now you see what I saw:

The Business Model Canvas describes key organizational models too.

But displaced in an asymmetric order.

This was causing my “Process-me” get mad: I could not follow the R2L reading.

So I decided to invert the “Customer Relationships” with the “Channel” Block.

Now I have a Canvas that I can read from “Customer” to “Resources”
without wandering up and down at middle way.

Above I have all the “Taylor” blocks:
and i can see how the value chain processes co-ordinate
to use the resources to deliver the value proposition to Customer.

Below I have all the “Mayo” blocks
and they point me to all the “human factors” on which
I have to count, to make those processes work.

It’s really presumptuous to name these little changes

Business Model Canvas 2.0
(in this moment I do not have a better name at hand…)

But I really hope that you will like this re-shuffling of blocks
and that it will help you “digest” faster the “business model canvas”
methodology, and
sprint up your next Investors Presentation.

*) Steve Blank has invented “Lean Startup”
**) Taylor has started the “scientific management” approach to organizations at Ford Motor Company.
Mayo has started the”human relationship” approach to organizations at Western Electric.

— — — — — — — — — — — — — — — — —

To talk about this, or how I can help you bring your next business idea to market,

Just give me a call at +39 349 648 2225

(call me now, at breakfast time, when you drive to work, wait at the airport…)

Cordialmente,

Flavio

www.business-exploration.com

Copyright © 2015 Business Exploration ®, All rights reserved.

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Originally published at www.business-exploration.com.

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