In this month’s column, I will introduce you to the business model canvas (BMC), a simple, one-page document to help you identify the necessary business levers that can turn your idea into a success.
Developed by Alexander Osterwalder around 2008, the BMC is used by startups and established businesses worldwide to help define activities that can make their business a success.
There are nine building blocks:
1. Key partners
Who will help you develop or manufacture your product? Is there a business partner who will be critical to help you distribute the product?
2. Key activities
What things do you need to do to deliver on your products value proposition?
3. Key resources
Is there something essential for your product? Intellectual property? Brand? Human resources? Financial?
4. Value proposition
What value do podiatrists or patients get from your product? What needs are you satisfying?
5. Customer relationships
What kind of relationships customers expect you to have with them? Automated or personal?
6. Channels
How will you reach your customers? Through social media? What about after-sales?
7. Customer segments
For whom are you creating value? Podiatrists? Patients? Physiotherapists? Think niche before mass-market!
8. Cost structure
What are the most important costs inherent with the business model? Manufacturing? Rent? Salaries?
9. Revenue structure
What are customers willing to pay? Subscription model? Or upfront costs?
So, if you have an idea, what should you do with the BMC? Head to the link here and see if you can fill every box with a good answer. Try to avoid your own confirmation bias or taking the easy way out; be realistic!
Unfortunately, I see too many brilliant product businesses fail because they don’t think about execution. Make sure you begin to think about the underlying business model as soon as you can, so you can execute brilliantly.
You can contact Ben via ben@solushin.com or on LinkedIn.
