11. Uncover Opportunity Nucleus
– Increase customer satisfaction
– Create a new experience
– Uncovering
• unmet need
• underserved needs
Entrepreneurship@TBS 2012
12. Two Generic “Value types”
– Trapped Value
• More efficient markets
• More efficient value systems
• Ease of access
• Disrupt current pricing power
– New-To-The-World Value
• Customize offerings
• Extend reach and access
• Build community
• Enable collaboration
• Introduce new functionality or experience
Entrepreneurship@TBS 2012
13. Revealing Unmet or Underserved Needs
What are the steps in the Customer Decision Process:
l What is the ideal experience? How does reality differ?
l What are the key frustration points?
l What compensating behaviors do we see?
l How/why is the customer successful?
l Are their groups with underserved needs?
Entrepreneurship@TBS 2012
16. Profit Zones / Profit Pools
Source: Adapted from Walters (2002), Gadiesh and Gilbert (1998) and Slywotzky and Morrison (1997)
16
Entrepreneurship@TBS 2012
17. โมเด็ลกําไร 22 แบบ
Customer Solutions Profit Product Pyramid Profit Multicomponent Profit Switchboard Profit
Buyers Sellers
Profit
0
Price
Base Business
Volume
Other Components
Time
Time Profit Blockbuster Profit Profit Multiplier Model Entrepreneurial Profit
Other Forms
Price
$/Unit
$/Project
Revenue
Cost
Cost Base
Business
Q2 Q4 Q6 Q8 Q10 Key Asset Spin-Outs
Project Type
Post-Launch
17
Entrepreneurship@TBS 2012
28. Thirty profit patterns
MEGA PATTERNS CUSTOMER PATTERNS
No profit
Back to profit Profit shift
Convergence Microsegmentation
Collapse of the middle Power shift
de facto standard
Technology shifts the board Redefinition
CHANNEL PATTERNS Product patterns
Multiplication
Concentration Product to brand
Compression Product to blockbuster
Disintermediation
Product
Profit multiplier
KNOWLEDGE PATTERNS Product to pyramid
product to customer knowledge product to solution
Operations to knowledge ORGANISATION PATTERNS
Knowledge to product
VALUE CHAIN MODELS Skill shift
Deintegration Pyramid to network
Value Chain squeeze
Strengthening the weak link Cornerstoning
Reintegration
Conventional to digital
business design
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30. Which would you prefer?
Business Business
Design “A” Design “B”
Revenue $10 billion $8 billion
Profit $50 million $300 million
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31. business design
Today Next
Customer Selection
Unique Value Proposition
Profit Model
Strategic Control
Scope
Entrepreneurship@TBS 2012
32. Business Design Example: Airline Industry
Within a particular industry, companies may pursue very different Business Designs
United Southwest Southwest Next?
Customer Selection & • International & domestic; coach, • Domestic travelers;
Value Proposition business and first-class travelers coach only
• Broad network & loyalty program • Low-cost, no-frills w/ highly
consistent customer service
Value Capture/ • Tiered fares based on class, • Every-day low prices
Profit Model flexibility • High asset utilization
• Ancillary revenues
Scope • Global hub-and-spoke route • US-only point-to-point route
system system
Strategic Control • Controlled-access airports in key • Lowest costs
geos • High frequency route coverage
• Loyal frequent fliers
Organizational Systems • Sophisticated IT • Cultural emphasis on Southwest
• International Sales & Regulatory way
capability
Revenue • $16BB • $10BB
Market Cap • $4.7BB • $10BB
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33. Business Model
Partner Customer
Network Relationship
Core Value Value Distribution Customer
Capacities Configuration Proposition Channel Segment
Cost Success / Revenue
Structure Failure Streams
33
Entrepreneurship@TBS 2012
36. Example business models over the years
• The open business model • The loyalty business models
• The subscription business model • The Collective business models
• The razor and blades business model • The
(bait and hook) industrialization of services business
• The pyramid scheme business model model
• The • The
multi-level marketing business model servitization of products business model
• The network effects business model • The low-cost carrier business model
• The monopolistic business model • The online content business model
• The cutting out the middleman model • The freemium business model
• The auction business model • The premium business model
• The online auction business model • The direct sales model
• The bricks and clicks business model • The professional open-source model
• Various distribution business models
36
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45. Components of the Value Proposition
Customer expectations
Customer Ø Product – service
characteristics
Ø Service – support
characteristics
Ø Availability
Ø Information
Relative
competitive
positioning
Value Ø Distinctive
Customer Value
Proposition competencies
Model
Ø Competitive
necessity
Ø Competitive
advantage
Partner roles:
Ø Co-development
Ø Co-production
Ø Reseller services Organisation
Ø Customer servicing
45
Source: Adapted from Walters (2002) Entrepreneurship@TBS 2012
46. Customer Value Customer value Component Customer Value
Criteria Perceptions
Security Warranty, Parts availability Ø Response to claims
Ø Service parts for
emergencies
Performance Productivity Ø Plant utilisation
Customer Ø Decrease in number of
reworked products
Value
Ø Decreased R & D
expenditure
Ø Increased competitive
Criteria and
advantage
Aesthetics Customisation, Style/design Ø Enhanced workplace
image – ‘modern’
Value Convenience Order management system
appearance – PR benefit
Ø Ease of ordering, rapid
response. Order
Perceptions progressing information
readily available
Economy Price levels maintained Ø Price consistency
ensures margins
maintained and
competitive position
held
Reliability Delivery and product-service Ø Inventory holding can be
availability consistent maintained at financially
viable levels
Ø Customer’s customer 46
Source: Walters (2002)
Entrepreneurship@TBS 2012
service delivery
