Discover how you can improve your capabilities to deliver real value to your organisation.

1. BUSINESS
ACUMEN
Improving Your Capabilities to Deliver Real Value to your Organisation

2. The Business Model Canvas

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A business model is the integrated manner in which an
organisation determines its customer’s needs, and designs its
enterprise to provide products and services that respond to those
needs, providing returns that ensure its success and growth.
What is a Business Model?

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• Organisations exist to create value for their customers,
shareholders, and employees. The choices made by leaders
about how best to create this value can be captured in a simple
equation:
The markets/customers targeted/their needs
+The value proposed (products/services)
+The organisation's capabilities
+ Advantage when compared to competitors
= Customer, Shareholder, and Employee Results
What is a Business Model?

5. The value proposition of
what is offered to the
market.
The segment(s) of clients
that are addressed by the
value proposition.
The communication and
distribution channels to
reach clients and offer
them the value
proposition.
The relationships
established with clients.
The key activities and
resources needed to
implement the business
model.
The Core internal
capabilities required to
execute the business
model.
The key partners and their
motivations to participate
in the business model.
The revenue streams
generated by the business
model (constituting the
revenue model).
The cost structure
resulting from the
business model.

6. VALUE
PROPOSITION
COST
STRUCTURE
CUSTOMER
RELATIONSHIP
TARGET
CUSTOMER
DISTRIBUTION
CHANNEL
KEY
ACTIVITIES /
RESOURCES
CORE
CAPABILITIES
PARTNER
NETWORK
REVENUE
STREAMS
gives an overall view of a
company's bundle of
products and services
portrays the network of
cooperative agreements
with other companies
describes the channels to
communicate and get in
touch with customers
describes the
arrangement of activities
and resources
explains the
relationships a company
establishes with its
customers
sums up the monetary
consequences to run a
business model
describes the revenue
streams through which
money is earned
describes the customers
a company wants to
offer value tooutlines the capabilities
required to run a
company's business
model
INFRASTRUCTURE
CUSTOMER
OFFER
FINANCE
Describing A Company’s Business Model

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DescribesWho a Company OffersValueTo
Describing TheTarget Market : Customer
TARGET
CUSTOMER
target customer 1
target customer 2
…
CUSTOMER

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• For whom are we creating value?
• Who are our most important customers?
Characteristics
– Mass Market
– Niche Market
– Micro Market
– Segmented
– Diversified
Customer

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Describing A Company’s Offer
Value Proposition
TARGET CUSTOMER VALUE PROPOSITION
target customer 1
target customer 1
…
value proposition 1
value proposition 2
…
OFFERCUSTOMER
Value Proposition

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• A customer value proposition gives an overall view of a company's
bundle of products, services and client solutions.
• It is the sum of the total benefits a customer is promised in return
for a payment (or other value transfer). It entail answering
questions such as:
o What value do we deliver to the customer?
o Which one of our customer’s problems are we helping to solve?
o What bundles of products and services are we offering to each
Customer Segment?
o Which customer needs are we satisfying?
Value Proposition

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Characteristics ofValue Propositions
– Performance
– Customisation
– Newness
– Design
– Brand/Status
– Price
– Cost Reduction
– Risk Reduction
– Accessibility
– Convenience/Usability
Value Proposition

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Most often, a real value proposition comes from:
• Better process (Walmart)
• Better people (McKinsey & Company)
• Better raw materials (luxury food items)
• Scarcity (diamonds)
Value Proposition

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Describes How a Company Reaches Its Customers
Distribution Channel
VALUE
PROPOSITION
TARGET
CUSTOMER
DISTRIBUTION
CHANNEL
value proposition 1
value proposition 2
…
distribution channel 1
distribution channel 2
…
target customer 1
target customer 2
…
CUSTOMEROFFER

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Through which Channels do our Customer Segments want to be
reached?
• How are we reaching them now?
• How are our Channels integrated?
• Which ones work best?
• Which ones are most cost-efficient?
• How are we integrating them with customer routines?
Customer

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Channel phases:
1) Awareness
How do we raise awareness about our company’s products and services?
2) Evaluation
How do we help customers evaluate our organisation’s Value Proposition?
3) Purchase
How do we allow customers to purchase specific products and services?
4) Delivery
How do we deliver aValue Proposition to customers?
5) After sales
How do we provide post-purchase customer support?
Channel

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VALUE
PROPOSITION
TARGET
CUSTOMER
CUSTOMER
RELATIONSHIP
value proposition 1
value proposition 2
…
relationship type 1
relationship type 2
…
target customer 1
target customer 2
…
CUSTOMEROFFER
Describes the Relationships a Company Builds
Relationship Management
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What type of relationship does each of our Customer Segments expect us to
establish and maintain with them?
• Which ones have we established?
• How are they integrated with the rest of our business model?
• How costly are they?
Relationship Management

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• Examples
– Personal assistance
– Dedicated Personal Assistance
– Self-Service
– Automated Services
– Communities
– Co-creation
Relationship Management

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TARGET
CUSTOMER
REVENUE
STREAM
revenue stream 1
revenue stream 2
…
target customer 1
target customer 2
…
FINANCE
VALUE
PROPOSITION
value proposition 1
value proposition 2
…
OFFER CUSTOMER
Describes How a Company Makes Money
Revenue Streams
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For what value are our customers really willing to pay?
• For what do they currently pay?
• How are they currently paying?
• How would they prefer to pay?
• How much does each Revenue Stream contribute to overall
revenues?
Revenue Streams

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Types:
• Asset sale
• Usage fee
• Subscription Fees
• Lending/Renting/Leasing
• Licensing
• Brokerage fees
• Advertising
Fixed pricing
• List Price
• Product feature dependent
• Customer segment dependent
• Volume dependent
Dynamic pricing
• Negotiation( bargaining)
• Yield Management
• Real-time-Market
Revenue Streams

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DescribesWhat Activities are Required
VALUE
PROPOSITION
KEY
ACTIVITIES/RESOURCES
CORE
CAPABILITIES
value proposition 1
value proposition 2
…
core capability 1
core capability 2
…
activity 1
activity 2
…
INFRASTRUCTURE OFFER
Key Activities
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What Key Activities do ourValue Propositions require?
• Our Distribution Channels?
• Customer Relationships?
• Revenue streams?
Categories
• Platform/Network
• Production
• Problem Solving
Key Activities

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CORE
CAPABILITIES
VALUE
PROPOSITION
core capability 1
core capability 2
…
value proposition 1
value proposition 2
…
OFFERINFRASTRUCTURE
DescribesWhat Capabilities are Required
Core Capabilities/Key Resources
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• What Key Resources do ourValue Propositions require?
• Our Distribution Channels? Customer Relationships?
• Revenue Streams?
Types of resources
• Physical
• Human
• Intellectual (brand patents, copyrights, data)
• Financial
Core Capabilities/Key Resources

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Describes the Partners that Leverage the Business Model
VALUE
PROPOSITION
PARTNER
NETWORK
CORE
CAPABILITIES
value proposition 1
value proposition 2
…
core capability 1
core capability 2
…
partner 1
partner 2
…
INFRASTRUCTURE OFFER
Key Partners
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• Who are our Key Partners?
• Who are our Key Suppliers?
• Which Key Resources are we acquiring from partners?
• Which Key Activities do partners perform?
Motivations for partnerships:
• Optimisation and economy
• Reduction of risk and uncertainty
• Acquisition of particular scarce resources and activities
Key Partners

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VALUE
PROPOSITION
COST
STRUCTURE
cost account 1
cost account 2
…
value proposition 1
value proposition 2
…
FINANCEINFRASTRUCTURE OFFER
Describes the Costs of a Business Model
CORE
CAPABILITIES
core capability 1
core capability 2
…
Cost Structure
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• What are the most important costs inherent in our business model?
• Which Key Resources are most expensive?
• Which Key Activities are most expensive?
Is your business more:
• Cost Driven (leanest cost structure, low price value proposition, maximum
automation, extensive outsourcing)
• Value Driven ( focused on value creation, premium value proposition)
Sample characteristics:
• Fixed Costs (salaries, rents, utilities)
• Variable costs
• Economies of scale
• Economies of scope
Cost Structure

30. Click to edit Master title styleSample Business Models

31. Click to edit Master title styleSample Business Models

32. Click to edit Master title styleSample Business Models

33. Click to edit Master title styleSample Business Models

34. Click to edit Master title styleSample Business Models

35. Click to edit Master title styleSample Business Models

36. Click to edit Master title styleSample Business Models

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