But on the other hand you can and sometimes must have different cultures in one firm. Just take the example of an IT Service firm which has two different business arms; one is project business, the other is data center services. The project business needs creative people who get a project done on time and on budget. During the project they can try different ways to find the optimal solution. From the data center guys (few women in this business) I expect that the service is up all the time. I want little creativity in running the machines, I just want reliable services. Due to the different requirements both business attract different kinds of people that value the different cultures and blossom in these different environments.

So to your last question on the difference of value proposition and offer. The offer is your just the physical product or service you offer. The value proposition is more abstract and is all about the utility/value your whole business model offers your customers.

A good example is the public transport in Germany and Switzerland. Both railway companies offer train transportations from one point to another. That is the offer. That is same but in different countries. In Germany the fast trains try to compete with planes so you have to book the trains in advance and the price is rising the shorter in advance you book your ticket. In Switzerland, the value proposition of the SBB, the national railway operator, is different. The idea is that train riding should be as easy as possible. So there is not mandatory reservation, trains go always at the same time so, for example, you just have to remember that the trains in Zürich to Bern leave at xy:00 and xy:32. The trains go every half an hour. Other trains even have go every quarter of an hour and allways at the same time of an hour. So, for example, at xy:05, xy:20, xy:35 and xy:50. And it starts at xz:05 again. Sounds complicated, but it is not. Customers just have to remember very little to get the right trains and if you miss one not big deal since the next train leaves in 15 or 30min. So the value proposition of SBB is different from Deutsche Bahn. SBB wants to have the train rides as hassle free as possible for the customers. SBB wants to compete with the flexibility of the car and not with planes.

So you see, the difference between the value proposition is huge between Deutsche Bahn and SBB while their offering is pretty much the same.

Thank you for your detailed answer.

In fact, my first question wasn’t about “value proposition”, but “values”, I mean “What values & beliefs top management does pursue”. Let’s imagine, we have a company, like global company with several Business Units, each of them following different Business Models.
Do values differ among these different Business Units? That’s why I’m asking about taking in account values at a strategic level, corporate one. You have one strategy, several business models, but you follow just one group of values (and it is at strategic level), this is what I think for now. Or maybe we shouldn’t call that “Value”, but “Value implementation”, considering the question: how to implement value and beliefs in each business block (key activities, key resources, value proposition …)?

Same with leadership style, I totally agree with you about the human factor, but do you believe it can differ among different Business Units inside a group? Hmm maybe on a cultural way if it is international? Also, shouldn’t we consider leadership style inside values? Cause it also depends on values of the top management?

One last thing, in your canvas, I don’t get the difference between “Offer” in the value architecture and “value proposition”.

Hope I did explain it good : )

Thanks for considering my comment,

Best regards,

Cyril

Sorry for the late reply. I was on vacation. You rise an interesting question about where the value proposition is located either on the business or at the corporate level. Actually my last post was on business vs. corporate strategy. Here I argue that the value proposition has to be on the business level of your firm not on the corporate level. In most small firms that is actually the same. But for large corporations with several business units it is not. And as a matter of fact quite often business units are not organized around customer needs but around internal reasons like production facilities.

Your second question is about the culture aspect. I have added the cultural aspect for one very special reason. The traditional view of a business model does not comprise the human factor. And as we all know it is the human being who makes or breaks a business. Of course, you can argue that the human factor is already included in the core competencies but I found out in my workshops with managers that the cultural aspect is neglected if not mentioned strongly on the business model canvas.

A great example where culture makes the different is Zappos, an online retailer, that was recently bought by amazon. Zappo is very similar in its business model compared to other online retailers but it is the culture that makes Zappo unique. Here is a link to their culture statement. Another example is mountain guide company in Switzerland called Bergpunkt.ch. Normally, the value proposition should be directed to the customer. In their case it would be people who like the mountains and what to do hiking anc mountain climbing. The quality of mountain experience is closely related to the quality of the mountain guide since he/she is the one that makes a huge impact on the tour. The guide makes or breaks the tour. So for Bergpunkt it is crucial to get the best mountain guides. How do they do it? They offer them a job with more safety than by working alone but still with the freedom of an independent mountain guide. They created a company culture that is highly attractive for the best mountain guides and that is one of the reasons why they are successful.

Hope I have help you. Actually, your question inspired me to write a post on the cultural aspect in a business.

Best regards

Patrick

Nice post. Thanks for that.

I’m currently working on the Business Model concept as student for my master thesis (I’m french, sorry if there are some mistakes).

Ok, the purpose of the thesis is to develop the business model of a company that I’m creating (a webagency) and analyse value creation sources.

I’m still working on the literature. I have a question relating to your canvas. You consider “Values” as a bloc in the Business Model canvas, isn’t it to be considered in the strategy at a corporate level? is your logic is that values need to be considered in BM to then be implemented within process?

Can you also explain what you mean by leadership style, I mean, how you consider it in BM concept?

Finaly maybe you have a written explaination of this canvas?

Thanks for you answer anyway,

Best regards,

Cyril Lecocq

I worked at the institute for media and communications management at the University of St. Gallen in Switzerland. Our research was on the impact on new media on business. The institute published also the Journal “Electronic Markets” where Paul Timmers wrote his famous article “Business Models for Electronic Markets” which is widely cited as the origin of today’s definition what a business model is. I worked at that time on the question how businesses on new media might be different from businesses that are based on “brick and mortar”. During that process I coined the term “Geschäftsmodellinnovationen” or in English “business model innovation” which, in my humble opinion, was not used in academia before. Gary Hamel was very close with his concept on business concept innovation in its book “Leading the revolution”. Kim and Mauborgne coined in 1997 and 1999 the term value innovation which they later elaborated in their book on “Blue Ocean Strategy” which is also related to business model innovation.

In 2001, I published my Ph.D. thesis on “Geschäftsmodelle in der digitalen Ökonomie” in German which became a classic in German speaking countries. Translated into English the title would be “Business models in the digital economy”. You find my work at Google books or in parts on http://www.business-model-innovation.com, a website that has been up since 2001. If you are interested in my definition you find it here and in more detail you find it here. There you also find a chapter on the origin of the term business model. The illustration you mentioned in your comment is just a graphical representation of what I wrote already 8 years ago.

The reason why we probably do not know each other is simple: First, unfortunately I published only in German. Second, I was working in a different industry for seven years before starting my think tank on businesss innovations in 2008 so I was not very active in disseminating my ideas.
Actually, your comment inspired me to write a post in the next time on the origin of the term business model (innovation).