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Sustainable Business Model Innovation using the Business Model Canvas - Michelin Case Study

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Sustainable Business Model Innovation using the Business Model Canvas - Michelin Case Study

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Got a new business idea, but don't know how to put it to work? Want to improve your existing business model? Overwhelmed by writing your business plan? There is a one-page technique that can provide you the solution you are looking for, and that's the business model canvas.

In this guide, you'll have the Business Model Canvas explained, along with steps on how to create one. All business model canvas examples in the post can be edited online.

What is a Business Model Canvas

A business model is simply a plan describing how a business intends to make money. It explains who your customer base is and how you deliver value to them and the related details of financing. And the business model canvas lets you define these different components on a single page.

The Business Model Canvas is a strategic management tool that lets you visualize and assess your business idea or concept. It's a one-page document containing nine boxes that represent different fundamental elements of a business.

The business model canvas beats the traditional business plan that spans across several pages, by offering a much easier way to understand the different core elements of a business.

The right side of the canvas focuses on the customer or the market (external factors that are not under your control) while the left side of the canvas focuses on the business (internal factors that are mostly under your control). In the middle, you get the value propositions that represent the exchange of value between your business and your customers.

The business model canvas was originally developed by Alex Osterwalder and Yves Pigneur and introduced in their book ' Business Model Generation ' as a visual framework for planning, developing and testing the business model(s) of an organization.

Business Model Canvas Explained (Click on the template to edit it online)

What Are the Benefits of Using a Business Model Canvas

Why do you need a business model canvas? The answer is simple. The business model canvas offers several benefits for businesses and entrepreneurs. It is a valuable tool and provides a visual and structured approach to designing, analyzing, optimizing, and communicating your business model.

The business model canvas provides a comprehensive overview of a business model's essential aspects. The BMC provides a quick outline of the business model and is devoid of unnecessary details compared to the traditional business plan.

The comprehensive overview also ensures that the team considers all required components of their business model and can identify gaps or areas for improvement.

The BMC allows the team to have a holistic and shared understanding of the business model while enabling them to align and collaborate effectively.

The visual nature of the business model canvas makes it easier to refer to and understand by anyone. The business model canvas combines all vital business model elements in a single, easy-to-understand canvas.

The BMC can be considered a strategic analysis tool as it enables you to examine a business model's strengths, weaknesses, opportunities, and challenges.

It's easier to edit and can be easily shared with employees and stakeholders.

The BMC is a flexible and adaptable tool that can be updated and revised as the business evolves. Keep your business agile and responsive to market changes and customer needs.

The business model canvas can be used by large corporations and startups with just a few employees.

The business model canvas effectively facilitates discussions among team members, investors, partners, customers, and other stakeholders. It clarifies how different aspects of the business are related and ensures a shared understanding of the business model.

You can use a BMC template to facilitate discussions and guide brainstorming brainstorming sessions to generate insights and ideas to refine the business model and make strategic decisions.

The BMC is action-oriented, encouraging businesses to identify activities and initiatives to improve their business model to drive business growth.

A business model canvas provides a structured approach for businesses to explore possibilities and experiment with new ideas. This encourages creativity and innovation, which in turn encourages team members to think outside the box.

How to Make a Business Model Canvas

Here's a step-by-step guide on how to create a business canvas model.

Step 1: Gather your team and the required material Bring a team or a group of people from your company together to collaborate. It is better to bring in a diverse group to cover all aspects.

While you can create a business model canvas with whiteboards, sticky notes, and markers, using an online platform like Creately will ensure that your work can be accessed from anywhere, anytime. Create a workspace in Creately and provide editing/reviewing permission to start.

Step 2: Set the context Clearly define the purpose and the scope of what you want to map out and visualize in the business model canvas. Narrow down the business or idea you want to analyze with the team and its context.

Step 3: Draw the canvas Divide the workspace into nine equal sections to represent the nine building blocks of the business model canvas.

Step 4: Identify the key building blocks Label each section as customer segment, value proposition, channels, customer relationships, revenue streams, key resources, key activities, and cost structure.

Step 5: Fill in the canvas Work with your team to fill in each section of the canvas with relevant information. You can use data, keywords, diagrams, and more to represent ideas and concepts.

Step 6: Analyze and iterate Once your team has filled in the business model canvas, analyze the relationships to identify strengths, weaknesses, opportunities, and challenges. Discuss improvements and make adjustments as necessary.

Step 7: Finalize Finalize and use the model as a visual reference to communicate and align your business model with stakeholders. You can also use the model to make informed and strategic decisions and guide your business.

What are the Key Building Blocks of the Business Model Canvas?

There are nine building blocks in the business model canvas and they are:

1. Customer Segments

2. Customer Relationships

3. Channels

4. Revenue Streams

5. Key Activities

6. Key Resources

7. Key Partners

8. Cost Structure

9. Value Proposition

When filling out a Business Model Canvas, you will brainstorm and conduct research on each of these elements. The data you collect can be placed in each relevant section of the canvas. So have a business model canvas ready when you start the exercise.

Business Model Canvas Template (Click on the template to edit it online)

Let's look into what the 9 components of the BMC are in more detail.

Customer Segments

These are the groups of people or companies that you are trying to target and sell your product or service to.

Segmenting your customers based on similarities such as geographical area, gender, age, behaviors, interests, etc. gives you the opportunity to better serve their needs, specifically by customizing the solution you are providing them.

After a thorough analysis of your customer segments, you can determine who you should serve and ignore. Then create customer personas for each of the selected customer segments.

Customer Persona Template for Business Model Canvas Explained (Click on the template to edit it online)

There are different customer segments a business model can target and they are;

Mass market: A business model that focuses on mass markets doesn't group its customers into segments. Instead, it focuses on the general population or a large group of people with similar needs. For example, a product like a phone.

Niche market: Here the focus is centered on a specific group of people with unique needs and traits. Here the value propositions, distribution channels, and customer relationships should be customized to meet their specific requirements. An example would be buyers of sports shoes.

Segmented: Based on slightly different needs, there could be different groups within the main customer segment. Accordingly, you can create different value propositions, distribution channels, etc. to meet the different needs of these segments.

Diversified: A diversified market segment includes customers with very different needs.

Multi-sided markets: this includes interdependent customer segments. For example, a credit card company caters to both their credit card holders as well as merchants who accept those cards.

Use STP Model templates for segmenting your market and developing ideal marketing campaigns
Visualize, assess, and update your business model. Collaborate on brainstorming with your team on your next business model innovation.

Create a Business Model

Customer Relationships

In this section, you need to establish the type of relationship you will have with each of your customer segments or how you will interact with them throughout their journey with your company.

There are several types of customer relationships

Personal assistance: you interact with the customer in person or by email, through phone call or other means.

Dedicated personal assistance: you assign a dedicated customer representative to an individual customer.

Self-service: here you maintain no relationship with the customer, but provides what the customer needs to help themselves.

Automated services: this includes automated processes or machinery that helps customers perform services themselves.

Communities: these include online communities where customers can help each other solve their own problems with regard to the product or service.

Co-creation: here the company allows the customer to get involved in the designing or development of the product. For example, YouTube has given its users the opportunity to create content for its audience.

You can understand the kind of relationship your customer has with your company through a customer journey map. It will help you identify the different stages your customers go through when interacting with your company. And it will help you make sense of how to acquire, retain and grow your customers.

Customer Journey Map (Click on the template to edit it online)

Channels

This block is to describe how your company will communicate with and reach out to your customers. Channels are the touchpoints that let your customers connect with your company.

Channels play a role in raising awareness of your product or service among customers and delivering your value propositions to them. Channels can also be used to allow customers the avenue to buy products or services and offer post-purchase support.

There are two types of channels

Owned channels: company website, social media sites, in-house sales, etc.

Partner channels: partner-owned websites, wholesale distribution, retail, etc.

Revenue Streams

Revenues streams are the sources from which a company generates money by selling their product or service to the customers. And in this block, you should describe how you will earn revenue from your value propositions.

A revenue stream can belong to one of the following revenue models,

Transaction-based revenue: made from customers who make a one-time payment

Recurring revenue: made from ongoing payments for continuing services or post-sale services

There are several ways you can generate revenue from

Asset sales: by selling the rights of ownership for a product to a buyer

Usage fee: by charging the customer for the use of its product or service

Subscription fee: by charging the customer for using its product regularly and consistently

Lending/ leasing/ renting: the customer pays to get exclusive rights to use an asset for a fixed period of time

Licensing: customer pays to get permission to use the company's intellectual property

Brokerage fees: revenue generated by acting as an intermediary between two or more parties

Advertising: by charging the customer to advertise a product, service or brand using company platforms

Key Activities

What are the activities/ tasks that need to be completed to fulfill your business purpose? In this section, you should list down all the key activities you need to do to make your business model work.

These key activities should focus on fulfilling its value proposition, reaching customer segments and maintaining customer relationships, and generating revenue.

There are 3 categories of key activities;

Production: designing, manufacturing and delivering a product in significant quantities and/ or of superior quality.

Problem-solving: finding new solutions to individual problems faced by customers.

Platform/ network: Creating and maintaining platforms. For example, Microsoft provides a reliable operating system to support third-party software products.

Key Resources

This is where you list down which key resources or the main inputs you need to carry out your key activities in order to create your value proposition.

There are several types of key resources and they are

Human (employees)

Financial (cash, lines of credit, etc.)

Intellectual (brand, patents, IP, copyright)

Physical (equipment, inventory, buildings)

Key Partners

Key partners are the external companies or suppliers that will help you carry out your key activities. These partnerships are forged in oder to reduce risks and acquire resources.

Types of partnerships are

Strategic alliance: partnership between non-competitors

Coopetition: strategic partnership between partners

Joint ventures: partners developing a new business

Buyer-supplier relationships: ensure reliable supplies

Cost Structure

In this block, you identify all the costs associated with operating your business model.

You'll need to focus on evaluating the cost of creating and delivering your value propositions, creating revenue streams, and maintaining customer relationships. And this will be easier to do so once you have defined your key resources, activities, and partners.

Businesses can either be cost-driven (focuses on minimizing costs whenever possible) and value-driven (focuses on providing maximum value to the customer).

Value Propositions

This is the building block that is at the heart of the business model canvas. And it represents your unique solution (product or service) for a problem faced by a customer segment, or that creates value for the customer segment.

A value proposition should be unique or should be different from that of your competitors. If you are offering a new product, it should be innovative and disruptive. And if you are offering a product that already exists in the market, it should stand out with new features and attributes.

Value propositions can be either quantitative (price and speed of service) or qualitative (customer experience or design).

Value Proposition Canvas (Click on the template to edit it online)

What to Avoid When Creating a Business Model Canvas

One thing to remember when creating a business model canvas is that it is a concise and focused document. It is designed to capture key elements of a business model and, as such, should not include detailed information. Some of the items to avoid include,

1. Detailed financial projections such as revenue forecasts, cost breakdowns, and financial ratios. Revenue streams and cost structure should be represented at a high level, providing an overview rather than detailed projections.

2. Detailed operational processes such as standard operating procedures of a business. The BMC focuses on the strategic and conceptual aspects.

3. Comprehensive marketing or sales strategies. The business model canvas does not provide space for comprehensive marketing or sales strategies. These should be included in marketing or sales plans, which allow you to expand into more details.

4. Legal or regulatory details such as intellectual property, licensing agreements, or compliance requirements. As these require more detailed and specialized attention, they are better suited to be addressed in separate legal or regulatory documents.

5. Long-term strategic goals or vision statements. While the canvas helps to align the business model with the overall strategy, it should focus on the immediate and tangible aspects.

6. Irrelevant or unnecessary information that does not directly relate to the business model. Including extra or unnecessary information can clutter the BMC and make it less effective in communicating the core elements.

What Are Your Thoughts on the Business Model Canvas?

Once you have completed your business model canvas, you can share it with your organization and stakeholders and get their feedback as well. The business model canvas is a living document, therefore after completing it you need to revisit and ensure that it is relevant, updated and accurate.

What best practices do you follow when creating a business model canvas? Do share your tips with us in the comments section below.

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Business Model Canvas: Explained with Examples | Creately

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Unlock the 9 Steps of the Business Model Canvas! Analyze and transform any business strategy with this comprehensive guide with examples. Learn more!.

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Carlsen Center for Innovation & Entrepreneurship

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Defining Your Social Impact Business Model with the Mission Model Canvas

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With the wave of the Lean Startup Method, the business model canvas has become a regular in our startup vocabulary. You’ve maybe even tossed the term around yourself, but what does it actually mean and how do you actually implement it?

Social Business Model Canvas

The business model canvas allows you to frame a hypotheses which you then test with customers until you get to the point in the validation process where you have enough to go on to build a minimum viable product. In simple terms, a good and conclusive canvas lays the groundwork for your business and changes with every iteration you go through. It describes how you create, deliver and capture value.

Originally crowdsourced, the book “Business Model Generation” by Alexander Osterwalder and Yves Pigneur at Strategyzer has sold over one million copies in 30 languages. The canvas allows you to frame a hypotheses which you then test with customers until you get to the point in the validation process where you have enough to go on to build a minimum viable product. In simple terms, a good and conclusive canvas lays the groundwork for your business and changes with every iteration you go through. It describes how you create, deliver and capture value.

The aim of this article is not to reinvent the wheel or summarize the extensive literature on the topic. It is a guide covering the basics and hopefully sparking your interest with lots of extra reading to dive into the deep end of the business model canvas pool for social entrepreneurs.

The Why and the How

Now I realize the term ‘business model’ has a corporate ring to it - not a language that the social sector historically has been friendly with, let alone fond of. But if you think about it, creating, delivering and capturing value is precisely what social entrepreneurs do. Let’s face it, a business model - the engine for sustained earned revenue - is what any social entrepreneur needs if (s)he doesn’t want to be stuck in the endless cycle of writing grant proposals and worrying about next month’s payroll. Besides, approaching your social enterprise through the lens of a business-model seeker will put your venture on an entrepreneurial path of seeking beneficiary-centered solutions, validated by their willingness to pay for the product or service you provide.

The business model canvas is a business’ blueprint once you strip away all the fine-tuned details and impossible-to-make business predictions found in a traditional business plan. It sketches out what you are trying to do for whom and how you think it’s going to work. The original canvas is made up of nine blocks that easy to grasp..

Image via Stategyzer

The Business Model Canvas in 3 (Big) Steps

Creating Value

Start with customer segments specifying who your customer is and what his/her specific characteristics and circumstances are. What can you find out about their socio-economic situation? Their income? Their preferences, needs, behaviors, attitudes? You may be serving different segments of one population. Start with one.

As a social entrepreneur, you may have to segment customers from beneficiaries. The ones paying for your product or service are not always the ones using it exclusively (think Ruby Cup’s one-for-one model). Consider both customer segments and develop personas for each.

The value proposition is the key to your business. Is the value you are creating - providing education to underserved communities or improving healthcare access - something that your beneficiaries appreciate as much as you think? The value proposition explains what problem you are solving for your beneficiaries and how. Figuring out whether or not your product or service meets customer needs may be my favorite part of the whole canvas exercise. If forces you to develop an in-depth understanding of customers needs, desires, and their reasons for not being able to overcome the issue themselves. The product or service you develop should address these factors to ensure you are meeting a real need under your beneficiaries’ limited condition. Use the Value Proposition Canvas to drill down on the specific details of what problem your customer is facing and how exactly you are addressing it. Getting this part right is crucial.

A social enterprise’s value proposition includes the value created for both the individual and society at large - the enterprise’s social impact. If your customers and beneficiaries are not identical, ensure it specifies how you create value for both.

Channels describe how you are going to deliver that value to your customers. Will you have your own storefront, partner with existing stores, or sell your goods and services online?

Depending on the beneficiaries you are trying to reach, you may have to get creative in reaching them. Identify channels that are easy - or at least possible - for them to access. Consider whether they are literate, use mobile technology, have reliable access to electricity or public transport. Access limitations are easily overlooked so consider these from the start.

Customer relationships outline how you interact with your customers. Are you offering personal assistance or will they be able to get their hands on your product through self-service? Will you offer service through community relations or will customers go through an automated system?

Trust and respect are key when working with underserved communities. Relationships with your customers should reflect this in every aspect of communications.

Delivering Value

Key resources are a breakdown of what inputs you will need to deliver your product or service. If you make a product, your key resources may include costly machinery and manufacturing facilities. If you are in the service industry, your key resources may be technology or some specific intellectual property. Think of them in terms of physical, human, intellectual, financial.

Speaking of activities: What is your main job to run this business successfully? Are you developing a technological solution? Are you selling fair-trade goods, training ex-convicts in job skills? These are your key activities. Make sure they all drive your intended social impact. It is easy to be overwhelmed with all the opportunities you can potentially pursue to make the world a better a place. Stick to your guns and focus on your KEY activities. For now. If you are successful with your first set, you can always expand. One step at a time.

Often, especially in the social sector, you rely on partners to make your solution work. Key partnerships highlight the relationships that are crucial to your business’ success.

As a social entrepreneur you pursue at least a double- if not triple-bottom line. This means you are - by definition - accountable to a wider spectrum of stakeholders. The best way to nurture and manage these relationships is by building partnerships with key stakeholders in sectors relevant to your venture. Who else is trying to solve the issue you are working on? Who are your allies? Especially if you work in emerging economies it is crucial to forge trust and strong relationships with partners in your value chain.

Capturing Value

How are you going to pay for all this? Revenue streams indicate how you make money. Ideally, you are selling your product to generate revenue. If that’s not an option, can you sell one version to customers who can afford it in order to subsidize sales to less affluent customers? Your revenue streams may be based on the direct sale of your product or service, a subscription fee, or renting, lending or leasing. Be creative. This also brings us back to customer segments and value proposition.

Every social entrepreneur I’ve worked with has heard this piece of advice early on: Don’t give your product away for free. Don’t make your beneficiaries dependent on free handouts, give them the dignity to pay for what you offer, even if it is a very small amount. We all appreciate the things we pay for more than for the ones we get for free. Charge SOMETHING for your product or service, and find other ways to generate revenue to at least break even. Is there a secondary customer base for your product or service? Can you partner with third parties to bring your product to market (development agencies, insurance companies)? Generating multiple revenue streams makes you less dependent and more resilient in case one stream dries up.

In order to define your price points for revenue streams, you need to have a very clear idea of your cost structure. Cheap airlines operate on a low-cost structure while your social business - hopefully - runs on a value-driven one, which may include high quality (think Cartier) and high ethical value. Ideally you manage to combine elements of both. Don’t sacrifice quality to save on cost. Think of your cost structure in terms of fix versus variable costs, and whether you capitalize on economies of scale (cost per unit decreases with more units produced) or scope (can you produce similar products or services while banking on shared machines, packaging, etc.?).

Depending on how you’re structured and what partnerships you have in place, consider whether you can outsource any costs to partners, and which elements you may be able to receive at a discount or through philanthropic giving. Which types of market capital do you have access to?

Wrap-up

There are many (many!) variations on the business model canvas, specifically for social entrepreneurs and mission-driven businesses. I have used the Social Lean Canvas for teaching before, and I recently came across the Mission Model Canvas by Alexander Osterwalder. These are great resources and I highly recommend playing around with them to see which language works best for you. At the end of the day, you should be able to fill in any version of the canvas and arrive at the same conclusions.

The business model canvas is a great tool to help you sketch out your social enterprise idea. It evolves along with every round of testing and iteration your idea goes through - make sure to keep it up to date (post-its go along way!).

With that said, remember that it’s also only that. A tool. It does not focus on analyzing your competition, nor does it guide you in terms of marketing and communicating your product or service - all of which inform your strategy. The canvas captures the key factors of your potential business; it’s up to you to complement elements that are crucial to YOUR business’ success.

Further Reading

If you’re intrigued and want to learn more about the business model canvas, I recommend the following:

Osterwalder, Alexander and Pigneur, Yves (2010). Business Model Generation.

Osterwalder, Alexander; Pigneur, Yves; Bernarda, Greg and Smith, Allen (2014).  Value Proposition Design.

Specific to Social Entrepreneurs

Acumen. Business Models for Social Enterprise (MOOC).

Osterwalder, Alexander (2016). This Mission Model Canvas: An Adapted Business Model Canvas for Mission-Driven Organizations (Strategyzer Blog).

Social Lean Canvas (Website featuring the social business model canvas in different languages and examples of existing social enterprises)

Young Foundation. The Social Business Model Canvas

Social Entrepreneurs Resource Hub at Stanford: Social Business Model Canvas (download here).

Dohrman, Susanne; Raith, Matthias; Siebold, Nicole (2015). Monetizing Social Value Creation: A Business Model Approach. Entrepreneurship Research Journal.

About the Author

Anika Horn has devoted her career to working social entrepreneurs from around the world building mission-driven businesses. As a mentor and coach at Social Ventures Australia, Social Impact Lab Hamburg and the DO School, Anika recently moved to the United States where she builds ecosystems for social entrepreneurs in mid-tier cities. On an international level, Anika researches best practices and common challenges in social enterprise support around the world. Her research is published under www.socialventurers.com.

Learn more about her work: www.anikahorn.com

This article was originally published in April 2016.

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This three-step approach to the business model canvas will help social startups create, deliver and capture value.

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A Scientific Method for Startups - Teppo Felin, Alfonso Gambardella, Elena Novelli, Todd Zenger, 2024

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Recent scholarship has sought to develop a “scientific method” for startups. In this paper we contrast two approaches: lean startup and the theory-based view of…

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Alex Osterwalder - The Exploit-Explore Continuum

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If you've ever thought about starting your own business, chances are you've probably heard of the Business Model Canvas. What is it exactly? It is a strategic management and entrepreneurial tool that allows you to describe, challenge, invent, and pivot your business model.

We recently had the pleasure of interviewing Swiss entrepreneur Alexander Osterwalder, who shot to international fame with his Business Model Canvas, and asked him about past failures, his advice to startups, and what motivates him.

You co-founded your first startup Netfinance.ch before completing your PhD. What happened to it? What would you have done differently if you had known what you do today?

That was a fun project. Netfinance.ch was a training business to help people invest online with online tools. It was more of a project than a real startup.

If there's one thing I would have done differently, it's: build less, test more. So, use much cheaper ways of testing ideas to see what resonates.

The second piece of advice would be to think more holistically, to be less product-focused and be more business model-focused in order to figure out the best business model.

At a certain point with Net Finance, we killed the project. It wasn't a failure. E-banking was new at the time, and while we had some success, it was not a scalable business model, so we moved on.

And I think that's a good thing. That was surprisingly wise at the time. Not every company or project needs to survive. You need to know when to move on to the next thing.

You are the author, among others, of Business Model Generation Value Proposition Design. What was the main reason that you wrote these books? Is there a book, in addition to yours, of course, that you would recommend to young startups?

Today, we're at five books at Strategyzer [consultancy firm, co-founded by Osterwalder]. Our most successful book is The Invincible Company. But out of the five books in the [Business Toolkit] series, maybe the most relevant for startup entrepreneurs is Testing Business Ideas by lead author David Bland, and me as a coauthor.

I would recommend two books not in the Strategyzer series: Steve Blank's The Startup Owner's Manual for young entrepreneurs and early startups; and, for startups that have some success and are moving to scale, High Growth Handbook by Elad Gil.

What is in your workspace that keeps you motivated?

Two things keep me motivated: the Swiss mountains, because that's where I get my inspiration. I digest everything I learn from working with companies when I'm on ski tours, back country ski tours, or on hikes.

The second is my family. Spending time with my family gives me the biggest boost in motivation to keep going.

We're often told that failure comes with the territory for young startups. In your opinion, why is that?

Failure is never the goal, but it's part of the journey.

A startup starts with a vision or an idea, but that's the easy part. Steve Blank likes to say that there's a fine line between vision and hallucination for startups.

What's really hard is to adapt your idea by testing it in the field with customers.

And in that process -- in that journey of testing your idea and adapting it again and again, and again -- you will fail a lot. But the goal is to keep failure cheap and fast so you can learn from it and adapt your idea, until you have a

value proposition that resonates with customers and a business model that can scale.

In my early startup journey, I started with building stuff rather than testing in a cheap and fast way and adapting it before actually launching a product or a service.

There's this myth in startups that you need to build something to test. You do not. You need to start understanding the customer, talk to customers, make brochures to describe your value proposition and see how people react

You will create a lot of things or believe a lot of things that are wrong and that's okay as long as you test that quickly, fail quickly and cheaply, and adapt. As an entrepreneur, you can never avoid making mistakes and failing. The key of being an entrepreneur is to stand up again and again and again. I like to say that the best entrepreneurs are okay with being humiliated and looking stupid a thousand times -- until they look good.

You were born in Switzerland, and you also studied here. Do you recommend starting a business here? Why or why not?

We started Strategyzer in Switzerland and it has been very good. We looked at different places -- Toronto where my co-founder is from and Singapore, because we're always attracted by vibrant Asia -- but Switzerland turned out to be a very good place to start, for the stability, for the legal framework, for taxes.

What was important for us is that we've always operated as a remote-first company. We attract talent from around the world. So even though we're a Swiss company very few people physically live and work in Switzerland. Still, it's a great base from which to operate.

What question are you always hoping someone will ask during an interview, but no one ever does?

Maybe the question: what do I think the role of a company is?

For me, companies have four roles: creating value for customers, creating value for the business, creating value for the team and creating value for society.

Companies need to create value for customers because otherwise they'll disappear.

Of course, they also need to create value for the organization. The business model needs to work. Otherwise, it's not profitable and will disappear.

Creating value for the team, the people who work in an organization, is the best way to have a positive impact on society, I think. Because if you're not creating value for your team members, they're going to leave. If you have happy people on your team, they're going to be happy when they go back home to their friends and family.

Finally, companies have an important role to play as corporate citizens contributing to society. Companies that don't have a purpose, that don't make a difference in society, will have a harder and harder time attracting strong talent.

I see more and more people who don't just want to work at a company for the money. They want to work for a company that they can identify with, and where their values align with the values of their employer, like Patagonia, right?

A very special thanks to Alex Osterwalder for taking the time to interview with >>venture>>.

To learn more about the Business Model Canvas and Osterwalder's other works, visit

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A chat with Alex Osterwalder, inventor of the Business Model Canvas

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If you've ever thought about starting your own business, chances are you've probably heard of the Business Model Canvas. What is it exactly? It is a strategic management and entrepreneurial tool that allows you to describe, challenge, invent, and pivot your business model.

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The Business Model Canvas - 9 Steps to Creating a Successful Business Model - Startup Tips

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Effectively conveying your business model and value propositions can mean the difference between securing vital resources and fading into obscurity. A captivating business model presentation is a skill that demands finesse, precision, and a deep understanding of strategic storytelling.

In this Strategyzer webinar we aim to share with you the mistakes to avoid and the best practices for delivering a compelling business model presentation, using our well-known tool the Business Model Canvas. Your host is Benson Garner, a seasoned business design consultant and a member of the Strategyzer content team.

In the following article, we'll delve into the valuable insights shared by Benson in the webinar, unraveling the art of delivering a compelling business model presentation while sidestepping common pitfalls. We will dissect the key takeaways, mistakes to avoid, and best practices that can transform your business model presentation into a powerful tool for securing investment, garnering support, and propelling your venture toward success.

Presentation killers: mistakes to avoid

Here we unveil presentation killers - the blunders that can cast a shadow over your business model presentation, obstructing the effective delivery of your message. These pitfalls, though common, can derail your audience's understanding and engagement. In this section, we'll dissect each of these presentation killers and shed light on their impact.

Mistake 1
Cognitive Murder: Revealing the entire canvas at once

One of the most significant blunders that Benson highlighted is the tendency to expose the entire canvas upfront. He coined this mishap as "cognitive murder." Our brains can't handle all of that information all at once. Overwhelming the audience with an entire canvas instantly can lead your audience to disregard your spoken words and focus solely on the canvas.

For example, consider Ivan, the fictional presenter, and his dental clinic-focused business model canvas. Had Ivan displayed the entire canvas at the start of his presentation, the audience might have struggled to absorb the myriad of details, failing to grasp the interconnectedness of the elements. Instead, Benson advocated for a step-by-step approach, layering in elements of the story as you narrate, using visual cues like Post-it notes for a cohesive, comprehensible narrative.

Mistake 2
Excessive detail and granularity

Benson cautioned against delving too deep into the nitty-gritty of your canvas during the presentation. While acknowledging the importance of detailed documentation, he stressed that strategic presentations require a concise focus on key elements. An overdose of granularity can obfuscate your central message and lead to confusion among your audience.

To illustrate, imagine Ivan inundating his canvas with exhaustive bullet points and minutiae regarding dental procedures, caseworker interactions, and billing intricacies. Such an approach could alienate the audience, overshadowing the core narrative. Benson's advice was to maintain a balance between depth and clarity, saving intricate details for separate documents or appendices, while your presentation remains a beacon of clarity.

Mistake 3
Cramming multiple ideas into one canvas

Ivan's predicament also showcases another common error: trying to fit multiple unrelated ideas into a single canvas. As Benson pointed out, "Separate those ideas out into completely separate canvases." Whether it's divergent customer segments or distinct value propositions, Benson urged the audience to avoid cluttering the canvas with an overload of ideas.

Envision Ivan struggling to showcase dental clinics, indigent populations, and revenue streams all in one canvas. Such a presentation would undoubtedly confuse the audience, making it challenging to grasp the essence of each idea. Instead, keep your message crystal clear by dedicating separate canvases to each idea, offering a concise and coherent narrative.

Mistake 4
Orphan elements: neglecting to connect all elements

"Orphan elements" emerged as another pitfall that can mar your presentation. As described by Benson, these are elements within the canvas that lack connections to the rest, resulting in a disjointed narrative.

For instance, if Ivan's dental clinic business model featured customer segments and value propositions but omitted the corresponding revenue streams, the canvas would suffer from orphan elements.These disconnected components disrupt the canvas's overarching story, causing confusion among the audience.

Instead, ensure that every element on the canvas contributes to a holistic narrative, weaving an interconnected story that captures the audience's attention and understanding.

Mistake 5
Mixing present and future states

Blending present and future states within the same canvas can also hinder your presentation's efficacy. Benson emphasized the need to distinguish between current and future aspects clearly. He advocated for colour coding or employing separate canvases for each state to prevent audience confusion.

Imagine Ivan's canvas depicting both his current dental clinic operations and his future plans to expand into new markets. Without visual differentiation, the audience might struggle to discern the temporal context of each element.

Instead, employ visual cues or separate canvases to maintain a cohesive narrative while clearly delineating present and future states.

Mistake 6
Blah blah blah: Engaging in irrelevant or excessive detail

Benson humorously labeled the tendency to stray off-topic or delve excessively into details as "blah blah blah." This pitfall often arises when presenters become sidetracked or succumb to the urge to share too much information, eclipsing the canvas and diluting the central message.

Imagine Ivan rambling about tangential dental industry statistics or lengthy billing processes without visual support. Such a monologue can alienate the audience, leaving them disoriented and disconnected.

Instead, stay aligned with the canvas, ensuring that your verbal narrative seamlessly complements the visuals, creating a clear and synchronized message.

‍

Best practices for creating a killer presentation

Benson Garner's webinar not only exposed the pitfalls to evade but also illuminated the path toward delivering a compelling business model presentation. In this section, we'll explore the best practices Garner outlined, offering a roadmap to crafting a presentation that resonates with your audience, captures attention, and effectively communicates your business model.

Best practice 1
Tell your story one step at a time

One of the cornerstones of a killer presentation, as emphasized by Benson, is the art of sequential storytelling. He stressed that unraveling the canvas's elements one at a time, while narrating the story, significantly enhances comprehension. "Layering in these elements one at a time," he said, using visual cues like Post-it notes, creates a cohesive, easily understandable narrative.

Imagine Ivan, the fictional presenter, guiding the audience through his dental clinic business model story step by step. As he unfolds each element, the audience is introduced to the indigent population, their needs, value propositions, and revenue streams.

This methodical approach ensures that the canvas elements are not overwhelming, and the narrative seamlessly connects with the visuals, leading to a clearer understanding.

Best practice 2
Use effective colour coding for clarity

Benson underscored the power of colour coding as a tool to distinguish different elements of the business model. By doing so, presenters can convey messages about customer segments, value propositions, and more. His guidance was simple: "You want to use an effective colour code to tell different elements of the story."

Returning to Ivan's dental clinic canvas, consider the use of colour to differentiate between customer segments and their corresponding value propositions. This visual distinction aids the audience in comprehending the narrative at a glance, enhancing clarity and aiding memory recall.

Best practice 3
Add visual enhancement and simplify

The importance of visual enhancement cannot be overstated. Benson urged presenters to use simple visuals alongside short, descriptive words to communicate effectively. "Better smiles" paired with a visual of a smiley face, he noted, creates a more lasting impact on the audience's understanding.

Imagine Ivan's canvas transforming from a cluttered arrangement of text to a streamlined version where simple visuals accompany descriptive phrases. The inclusion of these visuals simplifies complex ideas, making them more relatable and memorable for the audience.

Best practice 4
Be concise and omit unnecessary granularity

To maintain audience engagement, Benson urged presenters to avoid excessive granularity and detail during the presentation. He cautioned against the temptation to share irrelevant or overly intricate information. "All that granularity, all that detail is just going to confuse your audience," he warned.

Consider Ivan's hypothetical tendency to over explain dental procedures, caseworker interactions, and billing mechanisms. Such an approach could lead to audience detachment. Instead, streamline the presentation, providing the necessary information without overwhelming the audience with minutiae.

Best practice 5
Distinguishing assumptions from facts

In his presentation, Benson emphasized distinguishing between assumptions and evidence-based elements. He suggested verbally conveying which elements are established facts and which are assumptions. "You want to distinguish between what you know today are facts and which ideas are simply assumptions that you're going to have to test," he said.

Imagine Ivan's canvas clearly marking elements supported by evidence with checkmarks and assumptions with question marks. This differentiation ensures that the audience understands the degree of certainty associated with each element, fostering a more informed engagement with the content.

Best practice 6
Engage your audience with relevant multimedia content

Garner advocated for the strategic use of multimedia content to enhance the presentation's dynamism. Incorporating videos, images, charts, and graphs can engage the audience and bolster the understanding of complex concepts.

Envision Ivan embedding a video showcasing dental procedures, reinforcing his value proposition. The visual aid not only captures the audience's attention but also adds depth to his narrative, making it more immersive and memorable.

Best practice 7
Apply effective plot structure

Finally, Benson urged presenters to embrace effective plot structure in their presentations. He compared the presentation to a story, complete with a beginning, rising action, climax, falling action, and conclusion. "You want to create suspense that's going to pull your audience from one idea to the next," he advised.

Imagine Ivan crafting his presentation with the strategic plot structure in mind. As he gradually unveils the canvas elements, he builds anticipation, leading the audience through the narrative's twists and turns. This suspenseful approach not only captures attention but also ensures that the audience remains engaged and attentive throughout.

Incorporating these best practices into your business model presentation can elevate it from mere information sharing to an impactful storytelling experience.

In conclusion

In the world of business, presentation isn't just about sharing information; it's about crafting a compelling narrative that captivates, convinces, and catalyzes action. This webinar, fueled by Strategyzer's experience of delivering such presentation and coaching others to present, provided an illuminating journey through the dos and don'ts of delivering a business model presentation that truly resonates.

We explored the perils of presentation killers, learning to avoid revealing the entire canvas at once, steering clear of excessive detail, and sidestepping the trap of cramming unrelated ideas into one canvas. We discovered the importance of connecting all elements cohesively, steering clear of the confusion that arises from mixing present and future states, and resisting the urge to ramble on with irrelevant information.

On the flip side, we unveiled a treasure trove of best practices to transform your presentation game. From the power of sequential storytelling, effective colour coding, and visual enhancement, to the virtues of conciseness, distinguishing assumptions from facts, and embracing a strategic plot structure - each practice serves as a stepping stone toward delivering a killer presentation that leaves a lasting impact.

As you prepare for your next business model presentation, remember that success lies not just in the content you share but in the way you share it. Remember that every canvas element, every word spoken, and every visual aid should weave together a narrative that engages, educates, and energizes your audience.

To continue on this path of innovation, we invite you to join our upcoming webinars, where industry experts will delve even deeper into the topics of business design, strategy, and innovation.

So, whether you're preparing to address investors, stakeholders, or your internal team, remember the lessons of this webinar - and let your next presentation be a testament to the power of strategy, storytelling, and the Strategyzer approach to innovation.

About the speakers

Business design consultant

Benson is a business design consultant and a member of the Strategyzer content team. He helps companies of every shape and size, big, small, and everything in between to design or even redesign their business models and their value propositions. And at Strategyzer he also helps to create content for the Strategyzer workshops, the online course, Strategyzer blog, webinars. He is a contributor to our book: Value Proposition design.

Download your free copy of this whitepaper now

Never miss a Strategyzer webinar

Subscribe to receive email notifications for our upcoming webinars directly in your inbox.

Effectively conveying your business model and value propositions can mean the difference between securing vital resources and fading into obscurity. A captivating business model presentation is a skill that demands finesse, precision, and a deep understanding of strategic storytelling.

In this Strategyzer webinar we aim to share with you the mistakes to avoid and the best practices for delivering a compelling business model presentation, using our well-known tool the Business Model Canvas. Your host is Benson Garner, a seasoned business design consultant and a member of the Strategyzer content team.

In the following article, we'll delve into the valuable insights shared by Benson in the webinar, unraveling the art of delivering a compelling business model presentation while sidestepping common pitfalls. We will dissect the key takeaways, mistakes to avoid, and best practices that can transform your business model presentation into a powerful tool for securing investment, garnering support, and propelling your venture toward success.

Presentation killers: mistakes to avoid

Here we unveil presentation killers - the blunders that can cast a shadow over your business model presentation, obstructing the effective delivery of your message. These pitfalls, though common, can derail your audience's understanding and engagement. In this section, we'll dissect each of these presentation killers and shed light on their impact.

Mistake 1
Cognitive Murder: Revealing the entire canvas at once

One of the most significant blunders that Benson highlighted is the tendency to expose the entire canvas upfront. He coined this mishap as "cognitive murder." Our brains can't handle all of that information all at once. Overwhelming the audience with an entire canvas instantly can lead your audience to disregard your spoken words and focus solely on the canvas.

For example, consider Ivan, the fictional presenter, and his dental clinic-focused business model canvas. Had Ivan displayed the entire canvas at the start of his presentation, the audience might have struggled to absorb the myriad of details, failing to grasp the interconnectedness of the elements. Instead, Benson advocated for a step-by-step approach, layering in elements of the story as you narrate, using visual cues like Post-it notes for a cohesive, comprehensible narrative.

Mistake 2
Excessive detail and granularity

Benson cautioned against delving too deep into the nitty-gritty of your canvas during the presentation. While acknowledging the importance of detailed documentation, he stressed that strategic presentations require a concise focus on key elements. An overdose of granularity can obfuscate your central message and lead to confusion among your audience.

To illustrate, imagine Ivan inundating his canvas with exhaustive bullet points and minutiae regarding dental procedures, caseworker interactions, and billing intricacies. Such an approach could alienate the audience, overshadowing the core narrative. Benson's advice was to maintain a balance between depth and clarity, saving intricate details for separate documents or appendices, while your presentation remains a beacon of clarity.

Mistake 3
Cramming multiple ideas into one canvas

Ivan's predicament also showcases another common error: trying to fit multiple unrelated ideas into a single canvas. As Benson pointed out, "Separate those ideas out into completely separate canvases." Whether it's divergent customer segments or distinct value propositions, Benson urged the audience to avoid cluttering the canvas with an overload of ideas.

Envision Ivan struggling to showcase dental clinics, indigent populations, and revenue streams all in one canvas. Such a presentation would undoubtedly confuse the audience, making it challenging to grasp the essence of each idea. Instead, keep your message crystal clear by dedicating separate canvases to each idea, offering a concise and coherent narrative.

Mistake 4
Orphan elements: neglecting to connect all elements

"Orphan elements" emerged as another pitfall that can mar your presentation. As described by Benson, these are elements within the canvas that lack connections to the rest, resulting in a disjointed narrative.

For instance, if Ivan's dental clinic business model featured customer segments and value propositions but omitted the corresponding revenue streams, the canvas would suffer from orphan elements.These disconnected components disrupt the canvas's overarching story, causing confusion among the audience.

Instead, ensure that every element on the canvas contributes to a holistic narrative, weaving an interconnected story that captures the audience's attention and understanding.

Mistake 5
Mixing present and future states

Blending present and future states within the same canvas can also hinder your presentation's efficacy. Benson emphasized the need to distinguish between current and future aspects clearly. He advocated for colour coding or employing separate canvases for each state to prevent audience confusion.

Imagine Ivan's canvas depicting both his current dental clinic operations and his future plans to expand into new markets. Without visual differentiation, the audience might struggle to discern the temporal context of each element.

Instead, employ visual cues or separate canvases to maintain a cohesive narrative while clearly delineating present and future states.

Mistake 6
Blah blah blah: Engaging in irrelevant or excessive detail

Benson humorously labeled the tendency to stray off-topic or delve excessively into details as "blah blah blah." This pitfall often arises when presenters become sidetracked or succumb to the urge to share too much information, eclipsing the canvas and diluting the central message.

Imagine Ivan rambling about tangential dental industry statistics or lengthy billing processes without visual support. Such a monologue can alienate the audience, leaving them disoriented and disconnected.

Instead, stay aligned with the canvas, ensuring that your verbal narrative seamlessly complements the visuals, creating a clear and synchronized message.

‍

Best practices for creating a killer presentation

Benson Garner's webinar not only exposed the pitfalls to evade but also illuminated the path toward delivering a compelling business model presentation. In this section, we'll explore the best practices Garner outlined, offering a roadmap to crafting a presentation that resonates with your audience, captures attention, and effectively communicates your business model.

Best practice 1
Tell your story one step at a time

One of the cornerstones of a killer presentation, as emphasized by Benson, is the art of sequential storytelling. He stressed that unraveling the canvas's elements one at a time, while narrating the story, significantly enhances comprehension. "Layering in these elements one at a time," he said, using visual cues like Post-it notes, creates a cohesive, easily understandable narrative.

Imagine Ivan, the fictional presenter, guiding the audience through his dental clinic business model story step by step. As he unfolds each element, the audience is introduced to the indigent population, their needs, value propositions, and revenue streams.

This methodical approach ensures that the canvas elements are not overwhelming, and the narrative seamlessly connects with the visuals, leading to a clearer understanding.

Best practice 2
Use effective colour coding for clarity

Benson underscored the power of colour coding as a tool to distinguish different elements of the business model. By doing so, presenters can convey messages about customer segments, value propositions, and more. His guidance was simple: "You want to use an effective colour code to tell different elements of the story."

Returning to Ivan's dental clinic canvas, consider the use of colour to differentiate between customer segments and their corresponding value propositions. This visual distinction aids the audience in comprehending the narrative at a glance, enhancing clarity and aiding memory recall.

Best practice 3
Add visual enhancement and simplify

The importance of visual enhancement cannot be overstated. Benson urged presenters to use simple visuals alongside short, descriptive words to communicate effectively. "Better smiles" paired with a visual of a smiley face, he noted, creates a more lasting impact on the audience's understanding.

Imagine Ivan's canvas transforming from a cluttered arrangement of text to a streamlined version where simple visuals accompany descriptive phrases. The inclusion of these visuals simplifies complex ideas, making them more relatable and memorable for the audience.

Best practice 4
Be concise and omit unnecessary granularity

To maintain audience engagement, Benson urged presenters to avoid excessive granularity and detail during the presentation. He cautioned against the temptation to share irrelevant or overly intricate information. "All that granularity, all that detail is just going to confuse your audience," he warned.

Consider Ivan's hypothetical tendency to over explain dental procedures, caseworker interactions, and billing mechanisms. Such an approach could lead to audience detachment. Instead, streamline the presentation, providing the necessary information without overwhelming the audience with minutiae.

Best practice 5
Distinguishing assumptions from facts

In his presentation, Benson emphasized distinguishing between assumptions and evidence-based elements. He suggested verbally conveying which elements are established facts and which are assumptions. "You want to distinguish between what you know today are facts and which ideas are simply assumptions that you're going to have to test," he said.

Imagine Ivan's canvas clearly marking elements supported by evidence with checkmarks and assumptions with question marks. This differentiation ensures that the audience understands the degree of certainty associated with each element, fostering a more informed engagement with the content.

Best practice 6
Engage your audience with relevant multimedia content

Garner advocated for the strategic use of multimedia content to enhance the presentation's dynamism. Incorporating videos, images, charts, and graphs can engage the audience and bolster the understanding of complex concepts.

Envision Ivan embedding a video showcasing dental procedures, reinforcing his value proposition. The visual aid not only captures the audience's attention but also adds depth to his narrative, making it more immersive and memorable.

Best practice 7
Apply effective plot structure

Finally, Benson urged presenters to embrace effective plot structure in their presentations. He compared the presentation to a story, complete with a beginning, rising action, climax, falling action, and conclusion. "You want to create suspense that's going to pull your audience from one idea to the next," he advised.

Imagine Ivan crafting his presentation with the strategic plot structure in mind. As he gradually unveils the canvas elements, he builds anticipation, leading the audience through the narrative's twists and turns. This suspenseful approach not only captures attention but also ensures that the audience remains engaged and attentive throughout.

Incorporating these best practices into your business model presentation can elevate it from mere information sharing to an impactful storytelling experience.

In conclusion

In the world of business, presentation isn't just about sharing information; it's about crafting a compelling narrative that captivates, convinces, and catalyzes action. This webinar, fueled by Strategyzer's experience of delivering such presentation and coaching others to present, provided an illuminating journey through the dos and don'ts of delivering a business model presentation that truly resonates.

We explored the perils of presentation killers, learning to avoid revealing the entire canvas at once, steering clear of excessive detail, and sidestepping the trap of cramming unrelated ideas into one canvas. We discovered the importance of connecting all elements cohesively, steering clear of the confusion that arises from mixing present and future states, and resisting the urge to ramble on with irrelevant information.

On the flip side, we unveiled a treasure trove of best practices to transform your presentation game. From the power of sequential storytelling, effective colour coding, and visual enhancement, to the virtues of conciseness, distinguishing assumptions from facts, and embracing a strategic plot structure - each practice serves as a stepping stone toward delivering a killer presentation that leaves a lasting impact.

As you prepare for your next business model presentation, remember that success lies not just in the content you share but in the way you share it. Remember that every canvas element, every word spoken, and every visual aid should weave together a narrative that engages, educates, and energizes your audience.

To continue on this path of innovation, we invite you to join our upcoming webinars, where industry experts will delve even deeper into the topics of business design, strategy, and innovation.

So, whether you're preparing to address investors, stakeholders, or your internal team, remember the lessons of this webinar - and let your next presentation be a testament to the power of strategy, storytelling, and the Strategyzer approach to innovation.

Effectively conveying your business model and value propositions can mean the difference between securing vital resources and fading into obscurity. A captivating business model presentation is a skill that demands finesse, precision, and a deep understanding of strategic storytelling.

Thanks for your interest in

Ways to present the business model canvas

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Ways to present the business model canvas: avoiding mistakes and delivering a killer presentation

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Discover the secrets to delivering impactful business model presentations that captivate, convince, and inspire action. In this insightful article, we delve into the webinar hosted by Strategyzer's Benson Garner, a renowned business design consultant. Unveiling the pitfalls to avoid and the best practices to embrace, the article provides a comprehensive guide to creating a killer presentation.

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Here are 6 reasons why:

1. INTUITIVE

No MBA Required.

A design goal when creating the Lean Canvas was ensuring it was accessible to anyone in the company ( not just the business folks) because good ideas can come from anywhere. We tested the Lean Canvas in hundreds of workshops and across thousands of teams to ensure that all the boxes on the canvas were intuitive and easy to understand, and that you didn't need a business degree or a PhD to fill one out.

For more on the specific differences between the two canvases, check out this Medium article

2. UNIVERSAL

Used around the world.

All that testing paid off... Today you see the Lean Canvas used, not just by business folks, but also engineers, designers, and product managers at thousands of startups, accelerators, and large companies. It is taught at many of the top business and engineering schools around the world, and even at the high school level which is a testament to its simplicity.

3. DIFFERENT

Customer-Problem-Solution Focused.

Lean Canvas prioritizes getting your customer-problem-solution foundation in order first -- making it ideal for early stage innovation projects and startups. It's easy to see how if your customer and problem assumptions aren't in order, everything else on your canvas falls apart. And without the solution box, the canvas becomes just another business document that engineers, designers, and product managers cringe at.

4. SIMPLE

The power of the Lean Canvas lies in its simplicity.

The Business Model Canvas attempts to overcome its lack of customer centricity by pairing it with the Value Proposition Canvas. But then you have 2 canvases.
Why create 2 canvases, when one will do?

5. PRACTICAL

Built by entrepreneurs for entrepreneurs, not for consultants.

The Lean Canvas was created by serial entreprenuer, Ash Maurya, who wanted a more practical business planning tool than a business plan and a more actionable business modeling tool than a Business Model Canvas.

6. ACTIONABLE

Get better business outcomes.

Creating a better business modeling tool or a better business model canvas was never the point. Lean Canvas is part of a bigger Continuous Innovation framework that helps you systematically uncover what customers want and build products they cannot refuse.

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Business Model Canvas Alternative | LEANSTACK

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LEANSTACK is a continuous innovation platform that helps companies systematically uncover and build what customers want.

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I use this flow 9 times out of 10 when helping a team fill out a canvas:

1. Customer Segment - Who is your customer segment? (behavioral / market)
2. Value Proposition - What is your value proposition to them? (not your product, but the value it provides)
3. Channels - How do you reach and distribute your product to them? (acquisition / distribution)
4. Customer Relationships - What is the nature of your relationship with them? (automated, in-person, one time, ongoing?)
5. Revenue Streams - How do you make money from them? (direct / in-direct)
6. Key Activities - What are the key activities you need to do to make this work? (think verbs)
7. Key Resources - What are the key resources you need to have to make this work? (think nouns, physical / digital)
8. Cost Structure - What is this going to cost? (look at activities and resource costs)
9. Key Partners - Who do you partner with to make this happen? (partners bring activities / resources / channels)

Let me explain.

The business model canvas is not a left to right tool. It doesn't make sense to start with Key Partners when almost all of your early stage risk is desirability in the top right of your canvas. Once you've tested and proven out desirability, it moves quickly to viability and feasibility. While this flow isn't used 100% of the time, I find it is by far the most common case.

Try it with your teams and let me know how it works out.

Tickets are almost gone for September's Testing Business Ideas 3 Day Masterclass. This is the larger, conference style event that gets rave reviews from past attendees. It's a great place to meet like minded peers, experience live streamed music and hone your innovation skills. You can sign up here: https://www.strategyzer.com/training/virtual-masterclass-testing-business-ideas

The July Testing Business Ideas Cohort was a huge success. I personally coached people through assumptions mapping and experiment design for their real ideas. We already have 50 people on the waitlist for the next one, so if you'd like to be notified when we launch it, please go sign up: https://maven.com/precoil/testing-business-ideas

thanks,
-David J Bland
Founder,P recoil

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What order should you fill out a business model canvas?

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I use this flow 9 times out of 10 when helping a team fill out a canvas: 1. Customer Segment - Who is your customer segment? (behavioral / market) 2. Value Proposition - What is your value proposition to them? (not your product, but the value it provides) 3.

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BMC Customer Relationships - How to Build a Startup

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Value Proposition - How to Build a Startup

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BMC Customer Relationships - How to Build a Startup

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Lean Canvas & Business Model & Feature Canvas Online

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The Easiest Way to Create a Lean Canvas, Business Model or Feature Canvas for FREE

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In this article, the first in a 3-part series, we'll structure Osterwalder's exercises into easy-to-implement lesson plans you can use with your students.

Exercise #1: Business Model Matching

To introduce students to the 9 components of the BMC, Dr. Osterwalder starts by giving students a set of business model hypotheses and asking them to place each one in the appropriate box of the BMC.

Prepping Before Class

To make the most efficient use of class time, assign students to watch these videos before class:

Then you'll want to print out the worksheets linked in the lesson plan below. Digital worksheets are also in the lesson plan if you're teaching remotely.

Step 1: Fill the Boxes

Alex uses Airbnb in his first exercise because:

1. Students are familiar with Airbnb

2. As a two-sided marketplace, Airbnb is a great example of how one business model may need to fulfill the needs of multiple customer segments to be successful

Starting with the "Airbnb BMC: Travelers" worksheet, ask students to write each of the provided business model hypotheses in their appropriate boxes:

Copies of this worksheet are available in the lesson plan below.

We recommend each student complete this individually. While students will work in pairs for the next step, to help increase engagement and discussion, we like using Think. Pair. Share. with this type of exercise, which starts by having students work on their own.

Step 2: Pair

Next, ask students to pair up (if necessary, create breakout rooms for virtual students), and compare their answers. If there's anything they disagree on, ask them to try to discuss and come to a consensus.

Note: this is an important part of the Think. Pair. Share. process. Talking with a peer helps them organize their thoughts better and practice vocalizing them. If your students are reluctant to speak in class, pairing students up like this before asking for a class-wide discussion can help inspire more interaction.

Step 3: Share

Reconvene the class. Go one by one through the boxes and ask a pair to share what they wrote for a particular box. Go through each of the boxes in this order:

Ask a new pair to report out what they wrote for each box and then ask the rest of the class if they had anything else different for that box. If student pairs disagree on what should be in a particular box, use that as an opportunity to increase discussion and, before you reveal the correct answer, have your students vote on which answer they think will be right.

Slides with the correct answers, like the one above, are available in the lesson plan below.

Step 4: Repeat with Airbnb Hosts

Now ask students to fill out the AirBnB BMC: Hosts worksheet using the same Think-Pair-Share technique.

Take time to explain that many businesses don't have just one business model as a part of their success. Instead, many businesses, like Airbnb, are a multi-sided market. In this business model, the needs of two parties must be met.

You can highlight the popularity of this business model by pointing out that Uber, Doordash, Amazon all have this multi-sided market where the business has to keep multiple customers happy.

Summary & Next Steps

Alex prefers simple matching exercises like these as a quick way to introduce the BMC. For more details on how to use it, including worksheets and slides, check out the free lesson plan below.

Next up, Alex provides students with BMCs that are partially filled out and asks students to fill in the rest - which we'll detail in the next article in this series! We'll share two more steps in the process Dr. Osterwalder uses to teach the business model canvas:

How to use fill in the blank exercises to help students create their own canvases

How to use prioritization exercises to teach how to use the BMC to test business model assumptions

Want More from Dr. Osterwalder?

If you like this exercise, Alex also has two new books that are great resources for the classroom:

Find more about Alex's work at Strategyzer.com.

Watch Alex Teach

If you'd like to see Alex teach the Business Model Canvas himself, just enter your email below to watch his full workshop on Teaching the BMC:

Get the Teaching the Business Model Canvas Lesson Plan

We've created a detailed lesson plan for the "Teaching the Business Model Canvas: Part 1" exercise to walk you and your students through the process step-by-step.

It's free for any/all entrepreneurship teachers so share it with another instructor you know.

Read Part 2 In This Series of Teaching the Business Model Canvas

Check out the second post in this series, focused on using a fill-in-the-blank exercise to help students develop their own hypotheses.

What's Next?

In upcoming posts, we will share two more steps in the process Dr. Osterwalder uses to teach the business model canvas.

Subscribe here to be the first to get these in your inbox.

Missed Our Recent Articles?

Whether you are new to our community of entrepreneurship educators, or you've been contributing for years, we wanted to give you a list of the posts our community finds most valuable:

Improving Your (Inherited) Course. Inheriting an entrepreneurship course presents many challenges. Re-design the course and provide engaging experiences with this curriculum.

How to Improve Student Outcomes & Evaluations. Journaling can transform your students' experience in your classroom. And can be a great way to get quality feedback on whether you're an effective educator

"The best class I've taken!" We all want a Dead Poets Society moment in our entrepreneurship class. One professor using the Experiential Entrepreneurship Curriculum got hers!

Teaching Customer Interviewing. This card and the online game is a powerful way to teach students the importance of customer interviewing, and the right questions to ask.

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Teaching the Business Model Canvas: Part 1 - Intro - Teaching Entrepreneurship

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In this article, the first in a 3-part series, we'll structure Osterwalder's exercises into easy-to-implement lesson plans you can use with your students. To introduce students to the 9 components of the BMC, Dr. Osterwalder starts by giving students a set of business model hypotheses and asking them to place each one in the appropriate box of the BMC.

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"Startup success can be engineered by following the process, which means it can be learned, which means it can be taught." - Eric Ries

The Lean Startup provides a scientific approach to creating and managing startups and get a desired product to customers' hands faster. The Lean Startup method teaches you how to drive a startup-how to steer, when to turn, and when to persevere-and grow a business with maximum acceleration. It is a principled approach to new product development.

Too many startups begin with an idea for a product that they think people want. They then spend months, sometimes years, perfecting that product without ever showing the product, even in a very rudimentary form, to the prospective customer. When they fail to reach broad uptake from customers, it is often because they never spoke to prospective customers and determined whether or not the product was interesting. When customers ultimately communicate, through their indifference, that they don't care about the idea, the startup fails.

"The Lean Startup method teaches you how to drive a startup-how to steer, when to turn, and when to persevere-and grow a business with maximum acceleration."

"Using the Lean Startup approach, companies can create order not chaos by providing tools to test a vision continuously."

"By the time that product is ready to be distributed widely, it will already have established customers."

Eliminate Uncertainty

The lack of a tailored management process has led many a start-up or, as Ries terms them, "a human institution designed to create a new product or service under conditions of extreme uncertainty", to abandon all process. They take a "just do it" approach that avoids all forms of management. But this is not the only option. Using the Lean Startup approach, companies can create order not chaos by providing tools to test a vision continuously. Lean isn't simply about spending less money. Lean isn't just about failing fast, failing cheap. It is about putting a process, a methodology around the development of a product.

Work Smarter not Harder

The Lean Startup methodology has as a premise that every startup is a grand experiment that attempts to answer a question. The question is not "Can this product be built?" Instead, the questions are "Should this product be built?" and "Can we build a sustainable business around this set of products and services?" This experiment is more than just theoretical inquiry; it is a first product. If it is successful, it allows a manager to get started with his or her campaign: enlisting early adopters, adding employees to each further experiment or iteration, and eventually starting to build a product. By the time that product is ready to be distributed widely, it will already have established customers. It will have solved real problems and offer detailed specifications for what needs to be built.

Develop An MVP

A core component of Lean Startup methodology is the build-measure-learn feedback loop. The first step is figuring out the problem that needs to be solved and then developing a minimum viable product (MVP) to begin the process of learning as quickly as possible. Once the MVP is established, a startup can work on tuning the engine. This will involve measurement and learning and must include actionable metrics that can demonstrate cause and effect question.

The startup will also utilize an investigative development method called the "Five Whys"-asking simple questions to study and solve problems along the way. When this process of measuring and learning is done correctly, it will be clear that a company is either moving the drivers of the business model or not. If not, it is a sign that it is time to pivot or make a structural course correction to test a new fundamental hypothesis about the product, strategy and engine of growth.

Principles

1. Entrepreneurs
Are Everywhere

You don't have to work in a garage to be in a startup. Read More

2. Entrepreneurship
Is Management

A startup is an institution, not just a product, so it requires management, a new kind of management specifically geared to its context. Read More

3. Validated
Learning

Startups exist not to make stuff, make money, or serve customers. They exist to learn how to build a sustainable business. This learning can be validated scientifically, by running experiments that allow us to test each element of our vision. Read More

4. Innovation
Accounting

To improve entrepreneurial outcomes, and to hold entrepreneurs accountable, we need to focus on the boring stuff: how to measure progress, how to setup milestones, how to prioritize work. This requires a new kind of accounting, specific to startups. Read More

5. Build-Measure-Learn

The fundamental activity of a startup is to turn ideas into products, measure how customers respond, and then learn whether to pivot or persevere. All successful startup processes should be geared to accelerate that feedback loop. Read More

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"Startup success can be engineered by following the process, which means it can be learned, which means it can be taught." - Eric Ries The Lean Startup provides a scientific approach to creating and managing startups and get a desired product to customers' hands faster.

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How and when to appy the Lean Canvas? What is the difference to the Business Model Canvas and how might the Value Proposition Canvas supports both?

In many workshops and lectures the question arises when Lean Canvas (LC) and Business Model Canvas (BMC) are best used. At first sight both canvas look identical, because four building blocks are identical, namely Customer Segments, Value Proposition, Revenues and Cost Structure.

But if you take a closer look you will see that the other four elements on the canvas differ from each other.

The Lean Canvas has some boxes named differently, namely Problem, Solution, Unfair Advantages and Key Performance Indicators. In addition three building blocks are split and therefore have also new elements, which are the Existing Alternatives, Short Concept, and Early Adopters. The reason for this lies in their different applications

The Business Model Canvas focuses in the creation of a better understanding of an existing business model within the team or helps to create transparency while co-creating with business partners. Alexander Osterwalder and Yves Pigneur might argue that they have initially developed it to realize business model innovations. However, many practitioners apply the BMC to understand the existing business model or use it as a basis for the development of a business plan. By nature of the BMC it helps to optimize the cost structure and revenue streams of your business.

In contrast, the Lean Canvas from Ash Maurya has the ambition to understand and structure a venture or innovation project. The Lean Canvas documents perfectly the so called Problem-Solution-Fit.

Another Canvas, the "Value Proposition Canvas" supports both, the LC and BMC. The definition of the Value proposition is based on the customer profile, the pains, the gains and the job-to-be-done becomes of paramount importance to tackle the right problem. Personally, I use it together with the Lean Canvas or the Business Model Canvas in almost every workshop.

More interesting than the theory is the application in the use case for product and service innovations. As described in the Design Thinking Playbook, a lean and agile innovation process follows the "Problem to Growth & Scale Framework".

In the fuzzy front end of an agile innovation process has the objective to find an existing problem for a specific customer group or segment. The iterative Design Thinking approach is using different tools and methods until an appropriate Problem-Solution-Fit is found. The "journey" is typically documented with a Lean Canvas. In an early stage the assumptions are not completely verified and only one business model variant has been considered in the outline of the LC. However, the solution described should always cover the three aspects in the Venn-diagram, Desirability, Feasibility and Viability. Typically only a partially functioning prototype exists and the LC supports the endeavour to persuade the decision makers to support the project.

In the next phase, applying a Lean Start-up methodology, a Minimum Viable Product is iteratively improved. To determine the right business models, we recommend in "The Design Thinking Playbook" to define different variants of the business model and to select the most promising one. Different experiments with the users and customers support the process. The 55 different business model patterns, described by Oliver Gassmann, might be a good source for inspiration and providing appropriate business model analogies.

Once the best business model is determined and all the key assumptions are verified, a transfer from the Lean Canvas to the Business Model Canvas might be appropriate. The four different building blocks of the Business Model Canvas are now filled out and the cost structure can be optimized, by investgating for example a make or buy decision. Once the BMC is fully verified, a financial plan, marketing plan, or project plan can be elaborated. Now, all information for a business plan are available. If required by the decision makers or investors, the business plan can be created using the template the decision maker or investor prefer. However, writing a business plan might be more an exercise to think through the whole projects than developing a realistic plan to measure the business success in the future since it represents only the current, actual view and knowledge of the team.

In the Design Thinking Playbook edited by Michael Lewrick, Patrick Link and Larry Leifer, a combination of the Lean Canvas with the customer profile and experiment reports is proposed. The Lean Canvas is described in more details in the new Design Thinking Toolbook.

The Design Thinking Playbook is available on Amazon: http://a.co/d/e93450L

The Playbook is also available in:

and many other languages.

The Design Thinking Toolbook can be preordered: http://amzn.to/2ClgDgR

#DesignThinking

#LeanStartup

#BusinessmodelCanvas

#LeanCanvas

#FrontEnd

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When to use the Lean Canvas and when the Business Model Canvas?

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How and when to appy the Lean Canvas? What is the difference to the Business Model Canvas and how might the Value Proposition Canvas supports both? In many workshops and lectures the question arises when Lean Canvas (LC) and Business Model Canvas (BMC) are best used.

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The Business Model Canvas - 9 Steps to Creating a Successful Business Model - Startup Tips

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What to Do When You Can't Predict the Future 

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What to Do When You Can't Predict the Future 

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Video - Alex Osterwalder @ LIFT Conference - A New Approach to Designing Business Models

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Video - Alex Osterwalder @ LIFT Conference - A New Approach to Designing Business Models

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A New Approach to Designing Business Models - Alex Osterwalder

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"Test it in reality" http://change.is/quote/test-it-in-reality Alex Osterwalder, the best-selling author of Business Model Generation, speaks at Lift 2011. He tells us how organizations start approaching the challenge of designing business models in a radically new way. Companies learn how to test their business models upfront, iterating on the feedback received from their clients, thereby reducing the risk of failure.

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Create your visual business model or SWOT model with Canvanizer, business brainstorming blackboard, modelling tools

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Osterwalder Talk: New Approach to Designing Business Models

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Osterwalder Talk: New Approach to Designing Business Models

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A New Approach to Designing Business Models - Alex Osterwalder

# data[].attributes.attachment_link.description
"Test it in reality" http://change.is/quote/test-it-in-reality Alex Osterwalder, the best-selling author of Business Model Generation, speaks at Lift 2011. He tells us how organizations start approaching the challenge of designing business models in a radically new way. Companies learn how to test their business models upfront, iterating on the feedback received from their clients, thereby reducing the risk of failure.

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See also 'Workshop-Business Model Canvas'

What's the Business Model Canvas?

If you're already familiar, you can skip to the next section, ' How do I get started?'.

The Business Model Canvas (BMC) gives you the structure of a business plan without the overhead and the improvisation of a 'back of the napkin' sketch without the fuzziness (and coffee rings).

The Canvas has nine elements:

Together these elements provide a pretty coherent view of a business' key drivers-

1. Customer Segments: Who are the customers? What do they think? See? Feel? Do?

2. Value Propositions: What's compelling about the proposition? Why do customers buy, use?

3. Channels: How are these propositions promoted, sold and delivered? Why? Is it working?

4. Customer Relationships: How do you interact with the customer through their 'journey'?

5. Revenue Streams: How does the business earn revenue from the value propositions?

6. Key Activities: What uniquely strategic things does the business do to deliver its proposition?

7. Key Resources: What unique strategic assets must the business have to compete?

8. Key Partnerships: What can the company not do so it can focus on its Key Activities?

9. Cost Structure: What are the business' major cost drivers? How are they linked to revenue?

The Canvas is popular with entrepreneurs and intrapreneurs for business model innovation. Fundamentally, I find it delivers three things:

1. Focus: Stripping away the 40+ pages of 'stuff' in a traditional business plan, I've seen users of the BMC improve their clarify and focus on what's driving the business (and what's non-core and getting in the way).

2. Flexibility: It's alot easier to tweak the model and try things (from a planning perspective) with something that's sitting on a single page.

3. Transparency: Your team will have a much easier time understanding your business model and be much more likely to buy in to your vision when it's laid out on a single page.

How do I get started?

The first time you engage with the canvas, I recommend printing it out or projecting it on a whiteboard and going to town (see below for a PDF). Fill out the elements for your business and then ask yourself 'Does this make sense?' 'What are the most important linkages and components of the model?'

If you're ready to put together something a little more formal (for distribution, presentation, etc.) here's a Google App's template you can copy or download as MSFT PowerPoint:

LINK TO THE DOWNLOADABLE TEMPLATE

If the canvas is working for you, you'll probably end up editing it a lot and presenting it, so there are a few options below for documenting your canvas in an editable format:

Good for...
Brainstorming alone or in a small group

Documenting the Canvas in Google Doc's or MS Office (PowerPoint)

Documenting a canvas (if you have a Mac & Omnigraffle)

This is a nice tool and very robust.

By the way......
You can take any of these and project them on to a whiteboard for group sessions

This uses the presentation app in Google Doc's, which does a pretty good job of exporting to PowerPoint.LINK TO INSTRUCTIONS

This one uses layering to manage the canvas LINK TO INSTRUCTIONS

This one needs a little more set up but has lots of features

*Omnigraffle a popular diagramming program for the Mac. It has a fairly easy to use layering environment which you may find handy as you want to tinker with and produce different views of the canvas. You can try Omnigraffle for free (the basic paid version is $99).

What if I want more structure to work through this?

If you'd like a little more structure, the link below will take you to a related curriculum item that has workshop slides, prep. items, and agenda.
LINK TO WORKSHOP PAGE
Otherwise, the next sections (10 steps) offer a tutorial on how to use the template. The closing sections describe how to use the Google Doc's/PowerPoint and Omnigraffle templates.

Step 1 (of 10): Customer Segments

For purposes of using the canvas you should make sure you can answer these questions:
1. Segment Dimensions
Do you have a single or multi-sided market? If you have a multi-sided market you'll have at least as many segments as you have sides. An example of such a market is a media property like CNN.com: they have readers on the one side and advertisers on the other.
2. Segment Composition
If the segment dimensions are the 'macro' analysis of your customer base, then looking within each segment at individual customer types as 'Personas' is the 'micro'. As with economics, this is where most of action happens. You should be able to visualize these Personas- what kind of shoes do they wear? And you should understand what they think, see, feel, and do in your product area. Be sure to list both buyers and users of your product (many Personas will be both). For coaching on this, check out: Tutorial- Personas.
3. Problems, Needs, Habits & Current Alternatives
What job are you doing for the customer? What need are you fulfilling? There are no new behaviors- make sure that you can identify an existing need/problem and identify specific alternatives that your customer uses today. If you're not sure, go out and observe, talk to some representative people. You'll want to be able to clearly link your Value Propositions back to these in the next section.

Output: a list of Personas, organized by Customer Segment if you have more than one segment. I recommend trying to prioritize them- Who would you pitch first if you could only pitch one? Who next? And so forth...

Notes: If you're spending a lot of time on this first item, that's OK (and it's probably good). The Canvas is a tool, not a strategy and not all the nine blocks are equal. The pairing of Customer Segments and Value Propositions is really the 'independent variable' that should be driving everything else in your business model. When I use the Canvas in my Venture Design classes, we usually spend all of the first session (plus time for field research) on Customer Segments and Value Propositions.

Step 2 (of 10): Value Propositions

Which of the Problems or Needs that you identified in your Personas are you fulfilling? What is unique about your Value Propositions and why does your customer prefer them to their Current Alternatives? You may have a whole lot of these- and that's fine. When you're getting going with this, jot them all done on a whiteboard, index card, Post-It, etc. But then rank them and you'll probably want to winnow out all but the most critical. What things do you do that actually cause a customer to pick you over a competitor or alternative?

For example, at Leonid, an enterprise software company I founded, we thought our largest customers worked with us because of the cost savings we offered and our knowledge about best practices. It turned out that was mostly wrong- reducing their time and risk to get new services to market was the most important. It's not that the other things weren't important, but they weren't the top Value Proposition. That made a difference on how we sold the product and how we focused on operationalizing it for customers.

Once you've isolated these, try mapping them to the Customer Segments; it will look something like this:

LINK TO THE DOWNLOADABLE TEMPLATE

This mapping says 'We have 3 personas. Persona 1 cares about VP 1 & 2. Persona 2 cares about VP 2; Persona 3 cares about VP3. (One segment only so segments not noted)'.

Output: a prioritized list of Value Propositions and linkages from each Personas to the VP's relevant to them.

Notes: Again, this pairing is the key driver for most business models and if you want more on how to describe and discovery what to put in this part of the canvas, I recommend this: Tutorial- Personas.

Maybe you feel like you're in good shape on understanding the customer's world but you don't have any validation on whether the Value Propositions are clicking because this is a new venture? If you're not sure, that's OK and good for you for acknowledging the uncertainty! It's the responsible thing to do. The key is to write down those assumptions, prioritize them, and figure out the quickest and cheapest way to prove or disprove them. That's what Lean/Startup is about and there are resources here to help you with that, if you'd like- Tutorial: Lean Startup.

Step 3 (of 10): Channels

Channels includes entities you use to communicate your proposition to your segments, as well as entities through which you sell product and later service customers (see AIDAOR journey below). For example, if you sell bulbs for light houses and there's a website all light house attendants purchase equipment, that site is a sales Channel. If you use Google AdWords, that's a Channel, too (for getting attention). If you use a third party company to service the bulbs when they break, that's also a Channel.

Output: a list of important Channels, linked to Personas or Segments if they differ substantially. Make notes on what steps are relevant for each- promotion, sales, service, etc. See Note this section for more structure on this.

Notes: Channels and the next item, Customer Relationships, define your interface with the Customer. It's important to think all the way through the customer 'journey' in specific terms. For most businesses, the way they get a customer's attention is different than the way they onboard them or support them over the long term. For this, I recommend the AIDA.OR framework (attention-interest-desire-action-onboarding-retention) and storyboarding your way through it. Here's a post explaining all that- Storyboarding AIDA(OR). If you don't want to do the storyboards, I recommend at least making notes about your customer journey through the AIDA(OR) steps.

Another consideration is whether your channels will give you enough visibility into the user, including, for example, a way to follow up with users. Not sure? Document your assumptions Lean Startup style and figure out how you'll quickly prove or disprove them.

Step 4 (of 10): Customer Relationships

How does the customer interact with you through the sales and product lifecycle? Do they have a dedicated personal contact they see? Call? Is all the interaction over the web? Do they never see you at all but instead talk to a Channel? A few litmus test questions you may want to ask yourself at this point:
- Can the Value Proposition be delivered to the Customer this way? All the way through from promotion, to sale, to post-sale service? (See AIDAOR above on this.)
- Can you make the numbers work?
- Is there a premium support product you need to create/test? Many companies, like Apple, have rejected the false choice of 'Do we provide phone support or not?' instead offering personal support for a reasonable charge.

Output: a description of Customer Relationships, with notes if they differ across Customers (between Segments or among Personas within a Segment) or across the customer journey.

Notes: If you're a startup, be sure to document and review critical assumptions here. Also, the focal items are in a kind of specific order- you should validate your Segments and their relationship to the Propositions above all else. If this means you provide personal support in the early days (a 'concierge test' in Lean Startup terms) to do discovery and validation of Segments and Propositions, that's OK. You can subsequently test the Customer Relationship models. (Here's a post on using consulting as a concierge vehicle in B2B if you want more detail: Consulting as B2B Concierge Vehicle).

Step 5 (of 10): Revenue Streams

I won't bore you with proclamations about the importance of revenue- you get it. If you have an existing business, this will be self-evident.

At this point, you should map Segments to Propositions to Revenue Streams. The example below says 'Revenue stream 1 is driven by Persona 1′s involvement with Propositions 1 & 2; Revenue Stream 2 is driven by Persona 2′s involvement with Proposition 2; and Revenue Stream 3 with Persona 3′s involvement with Proposition 3.' That's relatively diverse- yours may be much simpler and that's fine.

Output: a list of Revenue Streams, linked (mutually) to Personas (or Segments if the mappings are the same within a set of Personas) and Value Propositions

Notes: If you have a startup or are re-engineering the business, this is a time to look at where you're driving revenue and whether it aligns with the rest of your focal points. Are you charging on value? Perceived value? They say everyone loves their banker; hates their lawyer. Why is that? Is there an actionable analog in your business?

Congratulations on making it halfway! At this point, you may want to step back and look at the picture you've created about your Offering and Customers. The next four steps deal with your 'Infrastructure', the plumbing you need to execute:

Step 6 (of 10): Key Activities

These are the crucial things the business needs to do to deliver on its propositions and make the rest of the business work- for example, if selling through 3 rd parties is part of the model, then activity around channel management is probably pretty important.

For a product-driven business, this probably includes ongoing learning about users and new techniques to build better product. If you're focused on doing a bunch of things for a particular set of customers (ex: comprehensive IT for law offices), this probably includes maintaining superior expertise on the segment(s) and creating or acquiring products and services that are a good fit, whatever that entails. For an infrastructure business (ex: electric utility), it probably includes keeping the infrastructure working reliably and making it more efficient.

You'll then want to consider how the Key Activities (and/or Key Resources) drive your Value Propositions:

Outputs: a list of Key Activities linked to your business' Value Propositions.

Notes: One question this analysis should raise for you is whether or not certain Activities and Resources are actually core, actually focal to your business, something you'll want to think through .

Step 7 (of 10): Key Resources

Key resources are the strategic assets you need in place, and you need in place to a greater or more targeted degree than your competitors. The Business Model Canvas proposes that there are three core business types: product, scope, and infrastructure. These tend to have similar types of Key Resources.

The following diagram describes how Key Activities drive the accrual of Key Resources:

Outputs: a list of Key Resources linked to your business' Key Activities.

Notes: Product-driven businesses have a differentiated product of some sort. Rovio, the company that makes the popular app Angry Birds, is such a company. Key Resources in product-driven businesses are typically key talent in critical areas of expertise and accumulated intellectual property related to their offering.

Scope-driven businesses create some synergy around a particular Customer Segment. For example, if you started a business that would take care of all the IT needs for law firms, that would be a scope-driven business. These businesses typically have key knowledge about their segment, a repeatable set of processes, and sometimes infrastructure, like service centers.

Infrastructure-driven businesses achieve economies of scale in a specific, highly repeatable area. Telecommunications is traditionally an infrastructure business. Retailers focused on retail, like Walgreens or Costco, are primarily infrastructure-driven businesses. The Key Resources for this type of business are, you guessed it, various types of physical or virtual infrastructure.

Let's take a single product category: diapers. The Honest Company or another innovating around compostable or otherwise more environmentally friendly diapers would be a product-driven take on the category. Procter & Gamble which has a cradle-to-grave strategy for providing consumer products is a scope-based take; so are various baby-focused retailers. Kimberly-Clark (wood pulp) or DuPont (chemicals and polymers) are both infrastructure-based takes: diapers is just another way to sell something they produce at scale with relatively little differentiation.

Step 8 (of 10): Key Partnerships

At this point, hopefully the Canvas has helped you sharpen and articulate your business' focal points. What Activities and Resources are important but not aligned with what's uniquely strategy for you? What's outside of your business type? Could partners do some of those? Why? Which?

I recommend mapping Key Partners to Key Activities. If an activity is key, it's still part of your business model. This is a way to denote which specific Partners are handling various Key Activities for you.

Output: a list of Key Partnerships with notes on their relationship to Key Activities.

Step 9 (of 10): Cost Structure

You've worked to understand how your Key Activities drive your propositions and hence your revenue. How do they drive costs? Are those costs well aligned with the key Value Propositions? Are the costs more fixed or variable as you test different business models? Are they more linear with your scaling or more fixed? You'll want to have these in mind as you tweak your model.

For purposes of linking things together, I'd look at how your Key Activities drive your Cost Structure:

If there are major cost components that don't map to a Key Activity, I'd take a closer look at those costs.

Output: a list of Cost Structure elements with notes on their relationship to Key Activities.
Congratulations- you have a working canvas! The section below offers a few analytical ideas and suggestions for next steps.
Step 10 (of 10): Applications, Analysis & Next Steps

Core Applications
The most core and obvious applications of the Canvas are to ask:
- Does it make sense?
- Could it be better?
- Does the rest of my team understand and agree? Have additional ideas?
- (rinse and repeat at least quarterly)

Competitiveness
The canvas does a good job of helping you figure out your business, which is a good place to start. You also want to look at the competitive environment and think about if and how you have/maintain a long term competitive advantage.

For this, I like Michael Porter's Five Forces framework ( Wikipedia Page; see also Chapter 2 of ' Starting a Tech Business '). Try walking through the Five Forces for your company and then bounce back to your canvas. How does it all hang together?

Next Steps
Every business is a work in progress (sorry, I try to avoid saying things like that but it seemed to fit here). As you go through the canvas, you may encounter areas that give you trouble. The table below summarizes a few of the most common that I see in my work as a mentor and coach:

You're having trouble crystallizing your Customer Segments and Value Propositions

I recommend the material here on Personas. See also Chapters 1-3 of ' Starting a Tech Business '. This will help you create a deep, actionable understanding of your customers.

You're looking for a more end-to-end view of how to design the venture- customer discovery, Lean-style experimentation, product design, product development.

The Venture Design materials provide a more comprehensive view of how to approach a new product or venture.

You're looking for a systematic way to organize your work on the venture over a period of weeks.

Startup Sprints is a popular program for stepping through a new product and/or venture. It's organized around agile-style iterations which you can size according to your pace.

You're not sure how much product to build (vs. license, leverage, etc.) or how to put it together.

See Chapter 4 of 'Starting a Tech Business'. This will help you think about what you need to build from a functional perspective so you can look at the available technology objectively and make strategic design decisions.

You're not sure where and how to partner.

See Chapter 8 of 'Starting a Tech Business'. This will give you a framework to use in partnership evaluations and a supplemental example.

Want to make innovation an everyday thing?

Using the Google Doc's/PowerPoint Template

If you're not familiar with it, Google Doc's is a web-based office suite, similar to MS Office. If you have a gmail account, you can access it (no guarantees- that was the case last time I checked).

First, you'll want to link to the template file: BUSINESS MODEL CANVAS TEMPLATE IN GOOGLE DOC'S.

Once you're accessed the file, you can make make it your own by going to the File menu and either 'Make a copy...', creating a copy in your own Google App's domain or you can use the 'Download as...' option to download it as PowerPoint (and a few other formats).

Probably the most key thing here is that I set it up so you edit the list of Canvas items (Segments, Relationships, etc.) in the Slide Master. I know what you're thinking- I hate those Master things and I never use them. Generally, neither do I. But in this case it's a good way to achieve some rudimentary layering, allowing you to do show things on top of the Canvas without having to recopy all the elements. You'll see what I mean on the file. The key thing is that to edit the list of Canvas items: Go to the 'View' menu, then go to 'Master' and edit the first slide you see under the Layout label over on the left:

Last note: The lines with multiple bends that you see are called a 'Polyline' in Google Doc's. If you click the downward arrow on the line item in the menu bar, you'll see it.

What's your experience with the Canvas? How have you used it? What worked? What didn't? Please consider posting a comment!

Want to make innovation an everyday thing?

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The 20 Minute Business Plan: Business Model Canvas Made Easy

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See also 'Workshop-Business Model Canvas' If you're already familiar, you can skip to the next section, ' How do I get started?'. The Business Model Canvas (BMC) gives you the structure of a business plan without the overhead and the improvisation of a 'back of the napkin' sketch without the fuzziness (and coffee rings).

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Videos - Customer Development - Steve Blank 

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Videos - Customer Development - Steve Blank 

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The Customer Development Process. 2 Minutes to See Why

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Book Excerpt - Business Model Generation File  

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Book Excerpt - Business Model Generation File  

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The Business Model Canvas Instruction Manual

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The Business Model Canvas Instruction Manual

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Testing Your Business Model: A Reference Guide

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Testing Your Business Model: A Reference Guide

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Designing Crystal Clear Business Model Canvases

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Designing Crystal Clear Business Model Canvases

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7 Questions to Assess Your Business Model Design

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7 Questions to Assess Your Business Model Design

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The Business Model Canvas, is a strategic management and entrepreneurial tool. It allows you to describe, design, challenge, invent, and pivot your business model.