Knowing the Value within your Business Model is vital

July 18th, 2013 by Paul Hobcraft

Knowing where to start in designing a business model or simply just even trying to describe it to others can be difficult. You need to explain its value. The great advantage of explaining this through a business model canvas that looks for value constantly does help. This a guest post by Paul Hobcraft, an Agility Innovation Specialist.

Business Model Canvasfluidminds approach to exploring and explaining the business model does just that- it focuses on focusing the mind on the value within the business model.

The first value point is in the Value Proposition

Naturally we all look to the Value Proposition to explain the business model but like a car you should always look ‘under the hood’ to see the engine and what gives a car its performance. Equally you should stand back from the proposition and ‘take in’ all that makes this up. For a car it is the styling, the design, the promise and what or who is behind it. We look to buy on a given ‘promise of value’ and in having the benefits explained it allows us to believe and ‘see’ the potentials. A business model, well designed and described, does just that. It confirms the (new or existing) value that makes up the new business model.

The value proposition shapes much; it identifies and defines where this business model is providing new offerings that advance on existing benefits to customers. The fluidminds business model canvas seeks out the customer and the customer benefit- it is looking to provide value by identifying where there is a clear fresh, new proposition.

Value Proposition on the Business Model CanvasWe do have to recognize a value proposition is not just looking to resolve the known jobs-to-be-done. In many new business models can be bringing together often fragmented parts of existing offerings and combining them in new ways, or deliberately and completely disrupting existing businesses through adapting new insight, technology advancements or understanding, into new business models. We only need to think of Apple and how it combined different technologies, revolutionary design and applied new materials into stunning, game changing products that changed our thinking of the actual jobs we thought about into totally different ones, which totally undermined existing business value or perceptions. Those become game changers.

Equally, a value proposition can emerge from those creative minds; again think Steve Jobs, where totally new business models become constructed upon a strong, clear vision or even different strands or inklings that something can be simply changed as the elements that were needed became available to make this happen. Yet they only happened from the dedicated hard work that came from purposeful design and detailed understanding of the possibilities.

No, value propositions come not just from known jobs-to-be-done but also from the unknown that can be identified through observation, research or ethnography how something is being completed. These come often from fertile, enquiring mind to see new combinations, different discoveries and then piece them together, in a business model that delivers new promise. So think beyond ‘just’ product and services, think always new business potential and then set about its design as the starting point, don’t constrain yourself initially.

Using a business model design approach that offers us a ‘fresh’ canvas structure where we can construct or even deconstruct the existing, might lead to completely revolutionary thinking when it comes to seeking out clear and exploring new value in any business propositions.

The second value point is in the Value Architecture.

For me, the architecture of the Business model is what and where something is going to deliver on the promise identified in the Value Proposition. Although much of the architecture of any business model is not seen, it is the ‘heart’ of what delivers the value. We can’t ignore or gloss over the value architecture, we must address it fully.

Fluidminds business model approach devotes much of its ‘canvas’ to this part. The initial questions of clarifying the offer, the value chain, the need for identifying core capabilities, for explaining the distribution and communication channels and who the (potential) partners are, all are initially raised specifically within the canvas to be addressed.

Value Architecture in the Business Model CanvasSo many of these begin as open ended questions, not just when you are building from scratch a new business model but when you want to ‘challenge’ an existing one. Architecture will always ‘raise its head’ to be fully addressed. It is vital. It might not be the sexist part of a business model but it is the ‘guts’, the performance engine, which can deliver the respective parts for ‘the promise’.

Addressing what makes up this part might leave some open questions to be resolved later but I’d recommend starting on the architectural design purposefully from the moment you begin, this makes for better and valued on-going conversations. You don’t need to get bogged down in the actual nitty-gritty of the exact design but you do need to sketch out the design and that is the role of the business architect, the orchestrator of design.

This is the place you seek and clarify understanding for that value. You operate often in three thinking minds here, to be fluid, agile and adaptable. You need to layer into your thinking a strategic view, a business design one and begin to work through the implementation actions and possible implications. You design and sketch. You need to begin to think layers of abstraction, a flow cycle approach.

The thinking around each part of the Value Architecture needs to grow within your thinking – the purpose, the performance you need, the possible processes that can support this, the level of preparation this will require and the level of commitment your people need to apply to this, so as to underpin and support the emerging business model or needed to change the existing one, all arise.

This is where the real value comes into play within the Value Architecture part. The deepening of thinking to achieve a shared thinking of what is possible, what needs further work to achieve the ‘value’ being looked for out of the business model.

So value architecture is the place for identifying the ‘value creation’ points, the rules and emerging governance that needs to be put into place. It is a large part of the fluidminds canvas as it requires multiple conversations to continually build the design to deliver on the ‘promise seen’.

The third value point is in teams and values

Anything new has controversy as it is pushing the known and accepted into the unknown. It raises fears, it whispers possible failure but for those that ‘unite’ and can see new possibilities a shared business canvas becomes the bonding point, the point where ideas come together and form within the team. The canvas becomes the focal point where the energy flows. The value of bringing into any discussions on designing or redesigning a business models early enough those different opinions, is of huge value. This brings you around the canvas to agree where you are going to spend your energy, your days in the future, your commitment, your passion.Team and Values on the Business Model Canvas

You begin to identify the strengths and weaknesses of the group; you begin to explore each other’s known and often surprisingly unknown competencies. You begin to spot gaps but you are working ‘collectively’ in resolving each other’s values and understandings of what ‘makes up’ the essence and worth that you perceive the new business design can bring, that ‘collective difference’ that allows you as a team to keep constantly questioning where the value lies by combing the efforts. You together as a team design-in value.

Having ‘value’ as central to your business model design is critical.

The design of the fluidminds business model canvas purposefully ‘looks’ for the value points. It provides a structure that askes for a value proposition, seeks out the value architecture and looks to the team to define their values and what values they need to pursue.

So why should your new business model exist? Because it seeks out new value, pure and simple, irrespective if you are an entrepreneur, someone just starting out for the first time or an existing business questioning its existing business approach. A new business model in its design, in its proposition, in its approach does need to seek out the value points constantly to get the best out of any new emerging business concept.

Are you exploring value constantly within your business model approach?

 

50 Responses to “Knowing the Value within your Business Model is vital”

  1. ralph_ohr Says:

    Great guest post by @Paul4innovating at @business_inno blog: Knowing the Value Within Your Business Model is Vital – http://t.co/gkfLcYukcT

  2. business_inno Says:

    Knowing the Value within your Business Model is vital. Great post by @pau4innovating http://t.co/o1xcfogC7w #bmgen #valuearchitecture

  3. pstaehler Says:

    RT @business_inno: Knowing the Value within your Business Model is vital. Great post by @pau4innovating http://t.co/o1xcfogC7w #bmgen #valu…

  4. jmegias Says:

    RT @business_inno: Knowing the Value within your Business Model is vital. Great post by @pau4innovating http://t.co/o1xcfogC7w #bmgen #valu…

  5. Lean_Startup Says:

    RT @business_inno: Knowing the Value within your Business Model is vital. Great post by @pau4innovating http://t.co/o1xcfogC7w #bmgen #valu…

  6. wimrampen Says:

    Is there really a need for another simplification of business models? http://t.co/JBpAhv9VPi

  7. mmaciasr Says:

    Knowing the Value within your Business Model is vital http://t.co/nCUyOQzkla vía @business_inno #bmgen

  8. Paul4innovating Says:

    Thks 4 RT @ralph_ohr:Great guest post at @business_inno blog: Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy

  9. Paul4innovating Says:

    Guest post @business inno blog:Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy #innovation #bmgen #innovate

  10. Lean_Startup Says:

    RT @mmaciasr: Knowing the Value within your Business Model is vital http://t.co/nCUyOQzkla vía @business_inno #bmgen

  11. Paul4innovating Says:

    Guest post @ business inno blog:Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy #innovation #bmgen #innovate

  12. DrNooo Says:

    “Knowing the Value within your Business Model is vital” good read http://t.co/tUOGYO6XAK

  13. Paul Hobcraft Says:

    Simplification- not sure what you are getting at there Wim. The whole issue of working through business models still lacks a considerable understanding for many.

  14. Lean_Startup Says:

    RT @Paul4innovating: Guest post @business inno blog:Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy #innova…

  15. Lean_Startup Says:

    RT @Paul4innovating: Guest post @ business inno blog:Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy #innova…

  16. Paul4innovating Says:

    Guest post @business_inno blog: Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy #bmgen #innovation #innovate

  17. Paul4innovating Says:

    RT @business_inno: Knowing the Value within your Business Model is vital. http://t.co/ZXDReZ5Vv3 #valuearchitecture #innovate #innosight

  18. Lean_Startup Says:

    RT @Paul4innovating: Guest post @business_inno blog: Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy #bmgen …

  19. LeanStartupBCN Says:

    RT @business_inno Knowing the Value within your Business Model is vital by @Paul4innovating http://t.co/44w5r3jUKT #bmgen #valuearchitecture

  20. rajul_joshi Says:

    RT @business_inno: Knowing the Value within your Business Model is vital. Great post by @pau4innovating http://t.co/o1xcfogC7w #bmgen #valu…

  21. DonaldMcMichael Says:

    Knowing the Value within your Business Model is vital http://t.co/RtszgjHI7E

  22. JurgenLACoach Says:

    RT @ralph_ohr: Great guest post by @Paul4innovating : Knowing the Value Within Your Business Model is Vital – http://t.co/qcpyfsDbFJ

  23. peterkeates Says:

    Knowing the Value within your Business Model is vital http://t.co/oq4NqWrrzS via @zite

  24. yousrimandour Says:

    Knowing the value within your business model is vital http://t.co/76Y8KuG20C

  25. wikinnovacion Says:

    Knowing the Value within your Business Model is vital http://t.co/PbO5D9DJpP vía @business_inno #bmgen

  26. Lean_Startup Says:

    RT @wikinnovacion: Knowing the Value within your Business Model is vital http://t.co/PbO5D9DJpP vía @business_inno #bmgen

  27. Paul4innovating Says:

    Thks 4 RT @JurgenLACoach:Great guest post by Paul Hobcraft : Knowing the Value Within Your Business Model is Vital – http://t.co/W4dTN8kiJy

  28. mdepaladella Says:

    “Having value as central to business model is critical” Yes! http://t.co/ZOHS1QMMkL #socinn #socent @Paul4innovating

  29. Paul4innovating Says:

    Thks 4 RT @mdepaladella “Having value as central to business model is critical” Yes! http://t.co/pcV3CLitqX #socinn #socent @Paul4innovating

  30. Paul4innovating Says:

    RT @mdepaladella: “Having value as central to business model is critical” Yes! http://t.co/pcV3CLitqX #socinn #socent @business_inno

  31. business_inno Says:

    RT @Paul4innovating: RT @mdepaladella: “Having value as central to business model is critical” Yes! http://t.co/WnhV4Bu3Dj #socinn #socent

  32. pyguill Says:

    Knowing the Value within your Business Model is vital http://t.co/UsL1hX4XZg

  33. chazver Says:

    Knowing the Value within your Business Model is vital http://t.co/FVXG55OJNm

  34. Loodsenmetlef Says:

    Knowing the Value within your Business Model is vital @Paul4innovating #businessmodels #innovation #design http://t.co/9tg3vwuIF0

  35. nomine_Artemis Says:

    RT @pfverdonk: Knowing the Value within your Business Model is vital http://t.co/eqjdA1J3TB

  36. entrep_thinking Says:

    RT @business_inno: Knowing the Value within your Business Model is vital. Great post by @pau4innovating http://t.co/o1xcfogC7w #bmgen #valu…

  37. Trep_Ed Says:

    Grest description of the value in #bmgen http://t.co/fA8RXBZ5jw via @business_inno

  38. Lean_Startup Says:

    RT @Trep_Ed: Grest description of the value in #bmgen http://t.co/fA8RXBZ5jw via @business_inno

  39. ftlohrke Says:

    RT @business_inno: Knowing Value within your #BizModel is vital. http://t.co/Pz4QObC8vl #valuearchitecture @pau4innovating #bmgen

  40. Niall_cspace Says:

    Knowing the Value within your Business Model is vital http://t.co/UPs2EdtbpN

  41. Paul4innovating Says:

    RT @mdepaladella: “Having value as central to business model is critical” Yes! http://t.co/pcV3CLitqX #socinn #socent #innovation #innovate

  42. tmjeremic Says:

    RT @ralph_ohr: Great guest post by @Paul4innovating at @business_inno blog: Knowing the Value Within Your Business Model is Vital – http://…

  43. Knowing the Value within your Business Model is... Says:

    [...] Knowing where to start in designing a business model or simply just even trying to describe it to others can be difficult. You need to explain its value. The.  [...]

  44. Knowing the Value within your Business Model is... Says:

    [...] Knowing where to start in designing a business model or simply just even trying to describe it to others can be difficult. You need to explain its value.  [...]

  45. BorutVovsek Says:

    Knowing the Value Within Your Business Model is Vital @business_inno @Paul4innovating http://t.co/PCrcb6ePKH

  46. wimrampen Says:

    This one is somewhat better, but no more useful than the #bmgen business model canvas http://t.co/JBpAhv9VPi

  47. Lean_Startup Says:

    RT @wimrampen: This one is somewhat better, but no more useful than the #bmgen business model canvas http://t.co/JBpAhv9VPi

  48. SienaIdea Says:

    Knowing the Value within your Business Model is vital http://t.co/L10O6civM7

  49. perommegaande Says:

    Knowing the Value within your Business Model is vital http://t.co/MpVqjhzPu3

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