A global standard used by millions of enterprises of all sizes. Enterprise can use the canvas to describe, design, challenge, and pivot their business model. In addition to this, it helps in describing how an enterprise can create, delivers, and capture value for and from its customers.
There exists 5 different categories of model and a business model canvas comes under - Rationale (the why part of the change). It comprises up of 9 building blocks that describe how an enterprise intend to deliver value and also provide a coherent view of business key drivers.
- 1. Key Partnership - What can the company not do so it can focus on its Key Activities?
- 2. Key Activities - What uniquely strategic things does the business do to deliver its proposition?
- 3. Key Resources - What unique strategic assets must the business have to compete?
- 4. Value Proposition - What’s so compelling about the proposition? Why do customers buy, use?
- 5. Customer Relationships - How do you interact with the customer through their journey?
- 6. Channels - How are these propositions promoted, sold and delivered? Why? Is it working?
- 7. Customer Segments - Who are the customers? What do they think? See? Feel? Do?
- 8. Cost Structure - What are the business's major cost drivers? How are they linked to revenue?
- 9. Revenue Stream - How does the business earn revenue from the value propositions?
Advantages - It is a widely used and effective framework that can be used to understand and optimize business models. It is simple to use and easy to understand
Disadvantages - Does not account for alternative measures of value such as social and environmental impacts. The primary focus on value propositions does not provide a holistic insight for business strategy. Does not include the strategic purpose of the enterprise within the canvas.
As a management consultant I help enterprise to sketch their business model canvas in order to demonstrate where the efforts of various departments and work group fits and align to the overall strategy of an enterprise.