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Business Model evaluation -- SWOT

I've read Business Model Generation and now am working my way back through it to build a business model(s). The business model evaluation assessments on pages 217-219 contain an assessment question, a factor for the importance to the business model, and a factor for the certainty of the evaluation. From the text, it's not clear how the overall value for each question should be calculated (1-10 for the importance, +/-5 for the assessment question, and 1-10 for the certainty). My questions include:

What is the established method for applying these weighting factors to the assessment question for his kind of analysis? Would it be something a simple as (importance * assessment question)/certainty for each question provide an effective metric?
After computing a value for each question, should they be summed together to get a total for each assessment section?
When you map all the assessment, threat, and opportunity question subsections to the canvas building blocks, you have three values for each canvas block. Should these be summed together to get an overall total for each canvas building block?
I'd like to compare Business Model canvases to help build a better model. Does comparing totals between canvas blocks provide an meaningful method of comparison (see figure below)?

I look forward to any help and guidance that you may be able to provide.

Tags: Assessment, Calculations, Evaluation, SWOT

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Permalink Reply by Angelica Villarroel on November 24, 2011 at 4:24am

Hi JAe,

I use the swot list they propose in page pag 217-223.

1. I give this list to each person of the team

2. They evaluate the BM in this sheet

3. Them when they are all finish we discuss the SWOT block by block (9 bloks of BM)

4. At the same time I use a matrix, X axis is the probabbility that occur (from 1 to 5) and Y axis y the impact in the organization if it happens (from 1 to 5).

5. In this matrix i put a post it with the opportunity/threat, (you can have an opportunity with a high impact on the organization but the probability it occurs is low (5-3), or you can have an opportunity which represents a high impact and at the same time it´s probability is high (5-5)

6. Once you have the opportunities/ treats at this matrix, you can define the priority (the opportunities/treats that you will need to focus for your business plan)

7. For the strengths and weaknesses, to define the priority to be focus on, we discuss the impact of these weaknesses and we define an action plan (in some cases you don´t have to wait until have the business plan ready, some things can be resolved while the plan is being defined), some issues can be resolve in short term and some in long term, it´s important to define responsible for each action/task.

I hope it can give you an idea!

Angélica

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Permalink Reply by david.a.s.grant on November 25, 2011 at 11:05am

Hi Jay

I can only comment on how I am using the SWOT but...

Currently I am simply using different post it colours to represent the various scores. So I would complete a canvas for Strengths and Weaknesses, and for +4 & +5 I use a green post it, 0 - 3 Blue, -3 - 0 Yellow and -4 & -5 Red. I note on the post it the question and then move to the next. Using this technique I am able to get a very speedy (if broad) idea of the levels of S & W's for the various areas. I then do the same with the Opportunities and Threats (of course amending the colour to number criteria a little).

This has allowed me to focus on the areas of concern / improvement and move towards dealing with those concerns.

If you come across a sounder way to do this, I would be interested to hear about it.

Regards

David

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Permalink Reply by Marijn Mulders on December 27, 2011 at 1:58pm

Hi Jay, With respect to the SWOT analysis I have developed a tool set that will help you to get a real insight in your business model. Just have a look at the excel spreadsheet for valuation of the canvas.

I also made a tool to compare two models based on the swot. And third I have a benchmark with all the companies I have evaluation from and that means one can compare a business model with the total database, or by country or by Industry.

Just have a look and give some feedback.

Best regards Marijn

Attachments:

BMG Evaluation example V3.1.xlsx, 121 KB

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Permalink Reply by Melissa Fisher on February 26, 2012 at 5:43am

Wow, that is a great spreadsheet. I have just picked up the book and have not gotten all the way through yet but, your spreadsheet helps to bring it into perspective. Thanks for sharing it.

Melissa

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Permalink Reply by Marijn Mulders on February 26, 2012 at 5:26pm

Hi Melissa,

There is a good set of questions at the end of the book. However it doesn't provide you the necessary information after answering the questions. With the evaluation you can.

Best regerads Marijn