Business Model Innovation Hub

... where visionaries, game changers, and challengers discuss business models

a more appropriate layout for the canvas?

I have been using the canvas extensively and with improved understanding and success with my clients since I changed the layout of the canvas into the attached format (The canvas rearranged.pdf).

what value does this lay out bring to the table?

- 1 and foremost it shows in just a glimpse what is involved in value generation for the customer: the value proposition of course (central), but customer relationships and distribution channels too. As I say to my clients, when choosing a channel, pick one that bring value to your customers. Not just delivery. Similar for customer relationship: as we all know, relationships are now the new value driver, following services and products.

-2 it touches to the company organization: far right = sales (CR, CS, CH), down stream = Mkg (RM, VP, CS), upstream = organisation & production (KA, KR, KP, C$) (although there are cost structure involved in downstream activities as well

-3 last but not least, it reveals what I call the "backbone": the BM core element, the ones that articulate the whole.

I welcome your comments and feed back

Tags: BM, backbone, canvas, generation, value

2 members like this

Comment

You need to be a member of Business Model Innovation Hub to add comments!

Join Business Model Innovation Hub

Comment by Brian Gladstein on May 8, 2012 at 9:35pm: It is interesting how many iterations there are of this canvas. I just posted my own. I enjoyed reading yours. I also separated the "demand side" from the "delivery side" much like you did, but for me I have the demand on the left. A couple other changes too... anyway thanks for sharing!

Comment by Mike Lachapelle on May 3, 2012 at 5:50pm: Hi Garrett

I am not sure the improved understanding is inherent in the re-arrangement of the canvas compnents. I would venture to say it is from your ability to better explain the components in this structure.

If anyone is interested in the theory and logic beind the canvas, and haven't already done so, I would strongly recommend reading Alex's original phd thesis that identified the 9 core components and proposed the relationship structure that became the canvas in BM generation.

The Business Model Ontology: A Propositon in a Design Science Approach (2004)

Here are my observations, without the benefit of your full explanation of your version.

The first thing that struck me about the re-construction is, though you state the value proposition is "central" to the business model, physically and visually my attention is drawn immediately to Revenue Streams as the central component of the model.

The Business Model Canvas was constructed specifically on the 'value chain' concept that begins with suppliers on the left, through activites to produce the value proposition (with the addition of necessary resources), to the delivery to the customer on the right side of the model (with the addition of relationship management). The financial model is an adjunct to the value chain model and underpins the value chain. That concept is lost in your construct. In reading from left to right the model begins with the cost structure; the 'story' of the model is lost.

In the re-arrangement of the components key relationships in the model are not so clear, and the continuity of the components is broken.

- key partners are much more likey to be providing resources or to be integrated into your key activities (outsourcing). Those relationships are not present in this construct.

- key resopurces, key activities and key partnerships are related to the creation of the value proposition. In your arrangement of the components they appear to be related to or filtered through the revenue streams

- in the Business Model Canvas the value proposition is connected to the customer segments through the channels (communication and transactions) and the relationships (acquisition strategy and retention). In the re-arrangement the concept is not there, and the value proposition is directly connected to the customer. The channels and relationship components appear to be independent of the value-customer relationship.

- the financial model is the product of the relationship between the revenue streams and the cost structures; i.e. the profitability / sustainability of the business. For me, by separating these two components the implied relationship is lost visually.

Finally, from my perspective the right side of the canvas is about value delivery, and the left side of the canvas is about value generation. Your model has the right side labeled as value creation.

One small but important point as well, Alexander has been very generous with the intellectual property, not copyrighting the material, and leaving it open to interpretation through the creative commons licence. However, it is somewhat inappropriate to label your model as "BM Canvas" as that would cause confusion and misunderstanding with the "Business Model Canvas". Also under the creative commons licence, when spinning off work with your interpretation, you should always acknowledge the source material and author.

What should not get lost in my observations is the canvas is a tool to help guide the conversation about the business model. The canvas and the 9 components are intended as a common language to support shared understanding. The end result that is important is whether the tool you use is successful for you and your clients to understand, externalize and discuss the business model.