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The business model canvas is a great tool to help you understand a business model in a straightforward, structured way. Using this canvas will lead to insights about the customers you serve, what value propositions are offered through what channels, and how your company makes money. You can use the business model canvas to understand your own business model or that of a competitor! The Business Model Canvas was created by Alexander Osterwalder, of Strategyzer.
The business model canvas is a shared language for describing, visualizing, assessing and changing business models. It describes the rationale of how an organization creates, delivers and captures value.
You can learn a lot from your competition. Choose some competitors and map their business models. Armed with this information you’ll have deep insight into what customers want and what they are willing to pay for. You’ll have a clearer picture of just how customers’ needs are met across the entire industry, not just in your company. And, you’ll uncover vital information about how other businesses, maybe even very successful businesses, have created their own spaces in the market.
Start by mapping out the business on a high level: only the most important, vital aspects of the business model.
Link up the building blocks: every value proposition needs a customer segment and a revenue stream!When everything is on the board, take a step back. Have a short break. Did you miss anything? Forget something?
Tip! If you have multiple customer segments it is best to pick a color for each segment. That way you easily see if for each segment there is a value proposition and a revenue stream.
Example Checkout the business models of BMW versus Tesla
Don’t mix ideas for a future state with what is going on right now, and don’t mix different departments!
Tip! If you work for a large organization you might find varying value propositions and business models. In that case, ask the different departments map out their own business model. Compare them afterwards.
Take a step back check if every customer segment is linked to a value proposition and a revenue stream. Make sure everything on the left side of the canvas is needed to support the right side of the canvas. Everything else can go.
Rank your business model's performance (0:bad, 10:excellent) for each of the following questions:
Tip! Have an artist visualize your business model. It helps creating impact when sharing the model and it makes it easier for others to become connected.
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