Three ways to get the most value from your Business Model Canvas.
Alex Cowan is Faculty at UVA Darden where he teaches three courses in the area of design and digital innovation. Prior to his time at Darden, Cowan was an entrepreneur and an intrapreneur. Here he breaks down three ways to maximise the value of your Business Model Canvas.
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Number 1: Product market fit
- Do not treat the elements of the business model canvas like simple checklist. The relationship between customer segments and value propositions is really the independent variable that's driving everything else.
- Focus on describing and articulating the hypotheses of your venture. Also prioritise what you want to test and why you need to test it. Because if you don't know what that relationship is, known as product market fit, everything else is highly provisional.
- You can also go one step back from those value propositions and ask, what is the underlying job to be done? What are the current alternatives that these target segments are using instead our proposition?
- Ask the right sort of innovation friendly questions about what you’re doing and what's important about it to them.
Number 2: Storyboard
Consider customer relationships and channels segments.
Get your individuals and teams storyboard ideas and plan from these areas. Don’t worry about how bad the drawings are.
Think about how does somebody go from not knowing about our proposition to becoming a happy habitual customer? Will they behave the ways that we hope and expect them to behave around the product?
The more you storyboard the more is gives everybody else permission to really put themselves in the customer shoes. Actually draw the pictures rather than write down the traditional platitudes.
Number 3: Determine your business model type
- Alex Osterwalder, founder of the Business Model Canvas, proposes that there are three fundamental business model types: scope, infrastructure, and product. Successful businesses focus on being one of those but not loosely all three.
- It is important to ask, not just for your individual execution but for the company as a whole:
What is your business model type?
What are the facts and circumstances that made you come to that conclusion?
Are your actions uniquely strategically important?