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Business Models for Dummies
Overview
What is a business model?
In its simplest form,
a business model
is your profit formula
It’s the method you use to
acquire customers, service
them, and make money
doing so
There’s some confusion as
to what’s a business model
and what’s not
A business plan isn't a
business model
But they are related
Neither is competitive
advantage or branding or
marketing
Your business model is the
foundation of profitability
Name three great
businesses
Business Models for Dummies Overview
Chances are they all have
great models
That’s because your
business model is the
foundation of profitability
Can you name a great
business without a great
business model?
You probably can’t
No amount of leadership,
hard work, or talent
fix a weak model
Business Models for Dummies Overview
Great leadership
+
bad model
=
A bad business
Average leadership
+
great model
=
great business
Business Models for Dummies Overview
But how do you create a
business model?
The wrong approach to
business model design
The Business Model Wheel™
offers a structured approach to
business model design
There are three aspects to
all business models
What is the offering?
How will you monetize
the offering?
How will you sustain it?
These are then structured
into eight areas
Offering
-Area #1: Market Attractiveness
-Area #2: Unique Value Proposition
Monetization
- Area #3: Profit Model
- Area #4: Sales Performance Model
Sustainability
- Area #5: Ongoing Competitive Advantage
- Area #6: Innovation Factor
- Area #7: Avoidance of Pitfalls
- Area #8: Graceful Exit
Business models aren't
static, they are fluid
Business models weaken
with time
Changing economic factors
Societal pressures
Fleeting consumer
preferences
Technological changes
&
Competitive pressures
All are working to weaken
your model
Business model innovation
is the solution
Your business model
effectiveness will peak
Innovation to version 2.0 of
business model will be
necessary
Great companies continually
innovate their business
model
The original business model
was transferring money mobile
phone to mobile phone
It didn’t work
They decided to hitch their
wagon to eBay and to the
email transfer of money
That worked in a BIG way!
Now there is a huge
opportunity for variation of
original model – phone
payments
Started in business making
everything from meat slicers to
punch cards for time clocks
Later bet the company on
mainframes and won
Transitioned to an
intellectual property seller
and consulting company
Started as small player in
industrial sandblasting
business
Moved up the value chain to
become largest supplier of
industrial cleaning supplies in
the world
Even more inside the book
Advanced innovation
techniques
Why most business
“problems” aren't really the
problem
Learn to score your
business model
Using the Business Model
Wheel™ as an assessment
and innovation tool
Buy the book at:
• Amazon.com
• Bn.com
• Booksamillion.com
• Wiley.com

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