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BUSINESS MODEL
	

@anggriawan, kaist mba, 2014
BUSINESS MODEL
	

A business model describes the rationale of how an
organization creates, delivers, and captures value.
	

	

INFRASTRUCTURE	


KEY 	

ACTIVITIES	


KEY	

PARTNERS	


OFFER	


CUSTOMER	

RELATIONSHIP	


VALUE	

PROPOSITION	

KEY 	

RESOURCES	


COST	

STRUCTURE	


TARGET	

CUSTOMER	

CHANNELS	


FINANCE	


CUSTOMERS	


REVENUE	

STREAMS
Value Propositions	

Key Activities	


Customer Relationships	


Key Partners	


Customers	


Key Resources	

Cost Structure	


Channels	

Revenue Streams
Customers	


CUSTOMERS	

- For whom are we creating value? 	

- Who are our most important customers?
Value Propositions	


VALUE PROPOSITIONS	

- What value do we deliver to the customer? 	

- Which one of our customer’s problems are we helping to solve? 	

- What bundles of products and services are we offering to each customer segments?
CHANNELS	

-  Through which Channels do our customers want to be reached	

-  How are we reaching them now? 	

-  How are we integrating them with customer routines:
awareness, evaluation, purchase, delivery, after sales?	


Channels
Customer Relationships	


CUSTOMER RELATIONSHIPS	

-  What type of relationship does each of our customers expect
us to establish and maintain with them? 	

-  How costly are they?
REVENUE STREAMS	

-  For what value are our customers really willing to pay? 	

-  How are they currently paying? How would they prefer to pay? 	

-  Fixed pricing / dynamic pricing?	


Revenue Streams
KEY RESOURCES	

-  What Key Resources do our Value Propositions require? 	

-  Physical? Intellectual? Human? Financial?	


Key Resources
Key Activities	


KEY ACTIVITIES	

-  What Key Activities do our Value Propositions require?	

-  Production? Problem solving? Platform/Network?
Key Partners	


KEY PARTNERS	

-  Who are our Key Partners? 	

-  Who are our key suppliers? 	

-  Which Key Resources are we acquiring from partners?	

-  Which Key Activities do partners perform?
COST STRUCTURE	

-  What are the most important costs inherent in our business model? 	

-  Is our business model cost-driven or value-driven?	


Cost Structure
Example: Amazon.com	

Key Partners
	


Key Activities
	


Value Proposition
	


	

Fulfillment

	

Logistics Partners

Customer Relationship
	


Customized Online
Profile &
	

Recommendations

Development &
	

Maintenance

Key Resources
	


	

Online Retail Shop

Channels
	


IT Infrastr ucture &
	

Software Platform

Amazon.com 
	

(  overseas sites)

Global Fulfillment
	

Infrastr ucture

	

Affiliates

	

Affiliates

Cost Structure
	


Marketing
	

Technology

Customers
	


Content
	

Fulfillment

Revenue Streams
	


	

Staff Salaries

	

Sales Margin

Global Consumer
	

Market
BUSINESS MODEL YOU
	

Describes the rationale of how you create, deliver, and capture value.
Value Propositions	

Key Activities	


Customer Relationships	


Key Partners	


Customers	


Key Resources	

Cost Structure	


Channels	

Revenue Streams
Value Provided	

Key Activities	


Customer Relationships	


Key Partners	


Customers	


Key Resources	

Costs	


Channels	

Benefits
KEY RESOURCES	

-  Who are you? 
(interests, skills  abilities, personality) 	

-  What do you have? 
(knowledge, experience, network, assets)	


career 	

“sweet spot”	


Key Resources	


interest	

(what excites you)	


skills  abilities	


personality	


(what you can do easily)	

 (the way you like 
to relate with others)
Value Provided	

Key Activities	

Customers	


Purpose Statement:	


“ I would like to HELP PEOPLE through these ACTIVITIES. ”	


KEY ACTIVITIES	


VALUE PROVIDED	


CUSTOMERS	


What do you do? 

How do you help?

Who do you help?

(The ones that distinguish your

(What value do you deliver to

(Supervisor, coworkers, clients,

occupation from others)	


your Customers?)	


community)
CHANNELS	

-  How will potential Customers discover how you can help them?	

-  How will they decide whether to buy your service?	

-  How will they buy it?	

-  How will you deliver what Customers buy?	

-  How will you follow-up to make sure Customers are happy?	


Channels
Customer Relationships	


CUSTOMER RELATIONSHIPS	

How do you interact with Customers?	

-  Face-to-face or written communication? 	

-  Single transaction or ongoing services? 	

-  Acquisition-focused or retention-focused?
Key Partners	


KEY PARTNERS	

-  Who helps you?
(colleagues, mentors, professional network, family, friends)
COSTS	


BENEFITS	


What do you give?	


What do you get?	


-  Hard cost (education, commuting,

-  Income sources	


clothing, communication)	

-  Soft cost (dissatisfaction)	


Costs	


-  Other intangible benefits	

	


Benefits
Personal Business Model Canvas	


How you interact
	

(Customer
Relationship)
	


What you do
	

(Key Activities)
	


Who helps you
	

(Key Partners)
	


How you help
	

(Value Provided)
	

Who you are 
what you have
	

(Key Resources)
	


What you give
	

(Costs)
	


Who you help
	

(Customers)
	

How they know
you  how you
deliver
	

(Channels)
	


What you get
	

(Benefits)
Example: Engineer	

Key Partners
	


Open source	

	

Communities

Key Activities
	


Value Provided
	


System analysis 
	

design
	

Programming

Customer Relationship
	

Face-to-face
	

communication

Customers
	


	

1. Tech Firms

	

Improving the
quality of human life	


	

Retention-focused

	

Debugging
Marketers 
	

Designers

Key Resources
	


Channels
	


	

Interest in Tech

	

GitHub

	

2. Product Managers

Increasing company
Former	

	

Classmates

	

Master degree

	

capability  innovation

	

3. End-users
Creativity 
	

Flexibility

	

Conference

Costs
	


Engineering	

	

books

	

Blog

Training 
	

Certification

Benefits
	


Time 	

	

Energy

	

Salary + Bonus

	

Awards

Personal 
	

Satisfaction
THANK YOU
	

References:	

Osterwalder  Pigneur, “Business Model Generation”	

Timothy Clark, “Business Model You”

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Business Model

  • 2. BUSINESS MODEL A business model describes the rationale of how an organization creates, delivers, and captures value. INFRASTRUCTURE KEY ACTIVITIES KEY PARTNERS OFFER CUSTOMER RELATIONSHIP VALUE PROPOSITION KEY RESOURCES COST STRUCTURE TARGET CUSTOMER CHANNELS FINANCE CUSTOMERS REVENUE STREAMS
  • 3. Value Propositions Key Activities Customer Relationships Key Partners Customers Key Resources Cost Structure Channels Revenue Streams
  • 4. Customers CUSTOMERS - For whom are we creating value? - Who are our most important customers?
  • 5. Value Propositions VALUE PROPOSITIONS - What value do we deliver to the customer? - Which one of our customer’s problems are we helping to solve? - What bundles of products and services are we offering to each customer segments?
  • 6. CHANNELS -  Through which Channels do our customers want to be reached -  How are we reaching them now? -  How are we integrating them with customer routines: awareness, evaluation, purchase, delivery, after sales? Channels
  • 7. Customer Relationships CUSTOMER RELATIONSHIPS -  What type of relationship does each of our customers expect us to establish and maintain with them? -  How costly are they?
  • 8. REVENUE STREAMS -  For what value are our customers really willing to pay? -  How are they currently paying? How would they prefer to pay? -  Fixed pricing / dynamic pricing? Revenue Streams
  • 9. KEY RESOURCES -  What Key Resources do our Value Propositions require? -  Physical? Intellectual? Human? Financial? Key Resources
  • 10. Key Activities KEY ACTIVITIES -  What Key Activities do our Value Propositions require? -  Production? Problem solving? Platform/Network?
  • 11. Key Partners KEY PARTNERS -  Who are our Key Partners? -  Who are our key suppliers? -  Which Key Resources are we acquiring from partners? -  Which Key Activities do partners perform?
  • 12. COST STRUCTURE -  What are the most important costs inherent in our business model? -  Is our business model cost-driven or value-driven? Cost Structure
  • 13. Example: Amazon.com Key Partners Key Activities Value Proposition Fulfillment Logistics Partners Customer Relationship Customized Online Profile & Recommendations Development & Maintenance Key Resources Online Retail Shop Channels IT Infrastr ucture & Software Platform Amazon.com ( overseas sites) Global Fulfillment Infrastr ucture Affiliates Affiliates Cost Structure Marketing Technology Customers Content Fulfillment Revenue Streams Staff Salaries Sales Margin Global Consumer Market
  • 14. BUSINESS MODEL YOU Describes the rationale of how you create, deliver, and capture value.
  • 15. Value Propositions Key Activities Customer Relationships Key Partners Customers Key Resources Cost Structure Channels Revenue Streams
  • 16. Value Provided Key Activities Customer Relationships Key Partners Customers Key Resources Costs Channels Benefits
  • 17. KEY RESOURCES -  Who are you? (interests, skills abilities, personality) -  What do you have? (knowledge, experience, network, assets) career “sweet spot” Key Resources interest (what excites you) skills abilities personality (what you can do easily) (the way you like to relate with others)
  • 18. Value Provided Key Activities Customers Purpose Statement: “ I would like to HELP PEOPLE through these ACTIVITIES. ” KEY ACTIVITIES VALUE PROVIDED CUSTOMERS What do you do? How do you help? Who do you help? (The ones that distinguish your (What value do you deliver to (Supervisor, coworkers, clients, occupation from others) your Customers?) community)
  • 19. CHANNELS -  How will potential Customers discover how you can help them? -  How will they decide whether to buy your service? -  How will they buy it? -  How will you deliver what Customers buy? -  How will you follow-up to make sure Customers are happy? Channels
  • 20. Customer Relationships CUSTOMER RELATIONSHIPS How do you interact with Customers? -  Face-to-face or written communication? -  Single transaction or ongoing services? -  Acquisition-focused or retention-focused?
  • 21. Key Partners KEY PARTNERS -  Who helps you? (colleagues, mentors, professional network, family, friends)
  • 22. COSTS BENEFITS What do you give? What do you get? -  Hard cost (education, commuting, -  Income sources clothing, communication) -  Soft cost (dissatisfaction) Costs -  Other intangible benefits Benefits
  • 23. Personal Business Model Canvas How you interact (Customer Relationship) What you do (Key Activities) Who helps you (Key Partners) How you help (Value Provided) Who you are what you have (Key Resources) What you give (Costs) Who you help (Customers) How they know you how you deliver (Channels) What you get (Benefits)
  • 24. Example: Engineer Key Partners Open source Communities Key Activities Value Provided System analysis design Programming Customer Relationship Face-to-face communication Customers 1. Tech Firms Improving the quality of human life Retention-focused Debugging Marketers Designers Key Resources Channels Interest in Tech GitHub 2. Product Managers Increasing company Former Classmates Master degree capability innovation 3. End-users Creativity Flexibility Conference Costs Engineering books Blog Training Certification Benefits Time Energy Salary + Bonus Awards Personal Satisfaction
  • 25. THANK YOU References: Osterwalder Pigneur, “Business Model Generation” Timothy Clark, “Business Model You”