The Art of Painting on the Business Model Canvas

June 30th, 2011 by Patrick Stähler

We have a great tool for visualization of a business model: the canvas. There is a hype on visual thinking and business model design. But can the tools deliver?

In the last years, I have seen many uses of the business model canvas to real cases. Some showed astonishing results, others were disappointing. Why? Any tool is only as good as the user. A fool with a tool is still a fool. But also: A genius without the right tool might be a fool. So let’s see, what makes the difference.

Visual Thinking = Thinking with Visual aid

Visual Thinking is often mistaken as nice visualization. A bad idea does not become better by visualization. Visual Thinking is great since you think in pictures. Visualization can help to make your thinking better, to see more options and see the interdependencies among all components. But you still have to think!

There was a reason why god gave us two brain hemispheres: Visual Thinking is the combination of analytical and creative thinking. So do the thinking.

Be precise in your thinking

Due to the limited space, people tend to be pretty imprecise when filling out the canvas. They fill the canvas as if it is just a form, not the master plan for a venture or for the future of your firm. That happens particularly often in large corporations where the people are so stuck in their old thinking.

The more precise the better, since that shows that you have precise thinking. That does not mean you have to know everything at the beginning of your thinking process. Mark clearly areas where you have to do more thinking instead of just filling out just something. If you have not enough space on the canvas then use the white board to draw the component. That is often the case for the production or value steps in your value architecture.

Be precise in your language

People love buzzwords particularly in the value proposition. They write about best-in-class, social something, customer-centric. All empty words (See post on the horror of Newspeak). Start with precisely describing who your customers are. Do not write business customers but identify some business customers that you can check tomorrow your value proposition with.

I force my participants to write down a list of ten names of customers they can call tomorrow to check if the value proposition is appealing or not. That leads to the next and most important point.

Customer Insights as starting point

A good and innovative business model starts with a customer insight, of something what is unsolved or badly solved for the customer. That is what I call a job to be done for your customers. But entrepreneurs love their products and they try desperately to find a need for their offer. They spent hours arguing why people should buy their offer during business model sessions instead of talking to real potential customers. It is important to convince your customers not others during the workshop.

The Art of business model design starts with a deep understanding of customers. So leave your conference room and test your assumptions about the value proposition when you do the business model design. Observe potential customers, ask them about the basic needs, not about today’s solutions, be curious, be adventurous.

The Art of Business Model Design

  • It’s all about the customer
  • Be specific what you say
  • Keep it simple, but not simplistic
  • Be self-explanatory
  • Focus on the relevant points where you make a difference
  • Do not reinvent everything

7 Responses to “The Art of Painting on the Business Model Canvas”

  1. Karl Burrow Says:

    The above is “Well Put”.
    I strongly agree that “Customer insight” is the starting point for any business model design.
    A good tool I have used from the BMG book is the Empathy Map by Xplane.

  2. Patrick Stähler Says:

    @Karl I haven’t worked with the empathy map. I think it is a good tool for existing markets and understanding better how the customer “works”. However, if we create a new and fresh market, what we do when we try to find a business model innovation, I think the job based approach is better.

  3. Dave Crowther Says:

    Patrick, thanks for a clear and timely blog.
    It is rewarding that we now have a body of experience rich enough to enhance the use of the canvas. It has moved so far since Alex’s PhD!

    You tease out a couple of key points:
    1. The need to avoid confusing “where are we?” with “where do we want to be?”. Each is required and each needs its own canvas, but they should not be recorded on the same canvas unthinkingly.
    2. Creating customer value at the core based on jobs to be done. I think most of us who have been using the canvas with clients for a couple of years weave in customer and job based practical thinking exercises to better inform the canvas. And as you identify in your final bullets the key is to identify what it is that you do differently. We ask canvas artists to review every point on the canvas and identify whether it is a ‘Zag’. We also ask whether their competitors could have drawn the same canvas.

  4. Patrick Stähler Says:

    Dave, it is good to see that we have academics on the blog as well. I took academia quite a while to understand the importance of the business model. http://blog.business-model-innovation.com/2010/07/business-models-long-range-planning-baden-fuller-and-latency/ And Teece analysed very well that business models have no foundation in business or economic theory. Particularly, his conclusion is great since he does not blame the “no-academics” for being wrong but wonders if his profession has the right unit of analysis for strategizing. Actually, I was an academic before when I wrote my PhD in 2001. It is true how far the topic has developed not only since Alex PhD, but since mine in 2001 when I coined the term business model innovation. That is the reason I have the URL for so long already 😉

    Unfortunately, I wrote my PhD in German, but if you want to read parts of it you find it at http://books.google.com/books?id=mgO-E6l0DScC&lpg=PR4&hl=de&pg=PR4#v=onepage&q&f=false or an abstract I wrote for a workshop Alex organized in 2002 (in English) http://www.scribd.com/doc/34770740/Business-Models-as-a-unit-of-Analysis-for-Strategizing And that last paper could be a good starting point for academia to ask the question if they use the right unit of analysis.

    To your other points:
    #1 is very important. People always confuse that. I call it the value perception gap.
    #2 I like the Zag concept from Marty Neumeier. I actually call it the UBM, the uniqueness in your business model. Good idea to write something on this in the future.

  5. Leaving blanks blank if you have not the facts to fill it | Business Model Innovation Says:

    […] Designing a business is art. Designing is an endless process to gain insights, to ideate, to develop assumptions based on insights, to challenge your assumptions, getting more to the point, to test with customers and accepting that a blank can be left for some time as a blank. Having a blank on the canvas is better than to have some useless small talk on the canvas. […]

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    […] Alla träffas och teamen presenteras för varandra och alla berättar om sina Business Model Canvas och antaganden. För alla som vill läsa mer om affärsmodeller kan även hitta mer om detta på internet, bland annat här. […]

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