The Business Model Canvas: A Global Standard
Every day organizations are creating new products and services for their customers. Unfortunately, customers don’t care about seven out of 10 of those innovations, according to Strategyzer.com.
However, there is a tool that is being used globally by millions of businesses of all sizes and in all industries to visualize, design, and test if and how you create value for your customers, before you take that product or service to market. It’s calledthe Business Model Canvas (BMC).
The BMC is a visual chart displaying the nine building blocks of an organization’s plan to create, deliver and capture value for the entity’s successful operation. The nine elements of the BMC are key partners, key activities, key resources, the value proposition, customer relationships, channels, customersegments, cost structure, and revenue streams.
To help illustrate the BMC, let’s pretend we’re a chic coffee shop and give illustrative examples of each element of the nine building blocks with that in mind.
1. Customer Segments: All the people and/or organizations for which you are creating value which includes users and customers.
o Example for coffee shop: Home and office clients
2. Customer Relationships: Outlines the type of relationship you’re establishing with your customers. How do you stay top of mind?
o Example for coffee shop: Product advertisement on TV and streets, loyalty cards
3. Channels: Shows which touchpoints you are interacting with customers and delivering value.
o Example for coffee shop: Supermarket retailers, official coffee shops, vending machines
4. Value Proposition: Each customer segment has a unique value proposition which is the bundle of products and services that create value for your customers. What problem or challenge are you solving for the customer?
o Example for coffee shop: Unique coffee, fast coffee, quality coffee, a place to hang-out with friends and/or a place to work
5. Revenue Streams: Makes clear how and for which pricing mechanisms the business model is capturing value.
o Example for coffee shop: Customers purchasing each item inside the shop
6. Key Resources: Shows which assets are indispensable in your business model; your infrastructure.
o Example for coffee shop: People (HR), bottling and packaging plants
7. Key Activities: Shows which things you really need to be able to perform well.
o Example for coffee shop: Marketing, production management, R&D, cleaning
8. Key Partners: Shows who can help you leverage your business model.
o Example for coffee shop: Coffee growers, coffee machine makers
9. Cost Structure: Once you know your business model’s infrastructure, you can determine costs.
o Example for coffee shop: Inventory of coffee and milk, lease of the building, payroll, and marketing
The middle column titled, Value Proposition, ties both sides of the canvas together and is the key to any organization’s success. If you’re not helping customers with some functional, social or emotional concern, solving a problem for the customer, and creating a positive outcome or results, then you’ll fall into that seven out of 10 category where your new product or service fails because it doesn’t bring a wanted value to the customer. The BMC is meant to be a tool that is cyclical so that you analyze, design, and test (via target market interviews and other methods) your new product or service over and over until you find the right fit (a.k.a. value) for you customer segment. Once you have the right fit, then you take your product or service to market, knowing already that it will be a success. The methodology works.
For more information contact your local Small Business & Technology Development Center.
This article is written by Director Rebecca Lobina, lobina@ nwmissouri.edu.
Griffons4Hire: We’re Here to Help
Missouri Western’s Career Development Center is making it easier for employers to find employees, thanks to a makeover of its Griffons4Hire online career management portal last month.
Dr. Vincent Bowhay said he and his staff have worked to make the site more user-friendly and intuitive for both employers seeking new hires and students and alumni who are looking for jobs. That included a mobile-friendly version, as well.
“We tried to remove any barriers to the success of connecting employees and employers,” he said.
Employers are invited to post job openings for free on the site, and they can arrange for on-campus interviews or information sessions.
“As liaisons between the university and the workplace, our goal is to assist employers with easy access to current students, recent graduates, and experienced alumni who are seeking new career opportunities,” Dr. Bowhay said.
He noted that Griffons4Hire is a “one-stop shop” for students, alumni, and employers. The center’s website also offers several resources, including interview and resume tips and access to CareerSpots career tips.
It also includes over 100 free careerreadiness videos to help students and alumni gain skills needed to achieve career success.
“Missouri Western students are ready for hire, and they have the skills employers need to be successful in on-campus, part-time, and full-time employment,” he said.
Dr. Bowhay said he has been visiting with several employers in the community to find out what their needs are and how Missouri Western can meet those needs, and he would like to meet more business leaders.
“Partnerships with the community is how we want to operate. That is key.” For more information, go to missoutiwestern.edu/ careerdevelopment.