The first time we saw Osterwalder’s presentation of the business model canvas, we realized that we had come across a great tool to help structure business models. The simplicity of the model is it’s true force. It enables established businesses as well as entrepreneurs to quickly restructure and question their business models. Changes to customer behavior and needs, specifically related to the explosive growth in mobile usage, calls for businesses to revisit their business models and question if or how a mobile strategy will affect it.
Any established business should remember that the rapid change in mobile technology means increased risk of new and disruptive business models. If you don’t challenge your own business model regularly, you might lose market share to innovative business models making your business obsolete.
The introduction of Uber in New York City reduced the price of a NYC taxi medallion by almost 30% in less than a year. Why did an organization like NY Taxi Workers Alliance not develop a “Yellow Cab Now” app years before the introduction of Uber. New York City is now catching up by aiming to have the TLC (Taxi and Limousine Commission) contract out or build the app. source: http://nypost.com/2014/12/08/nyc-cabs-could-get-app-to-compete-with-uber-lyft/
Meanwhile, yellow cab drivers are losing income and fearing that their medallions will devaluate further.
If you are interested in learning more about the business model canvas – watch this great video:
Mapping out your first business model
If you are new to business model creation, here is one advice: work fast – and try not to get distracted with too many details on the canvas. The more ideas and versions of the canvas you produce, the higher chance of success down the line. Don’t discard canvasses, but instead reiterate and update your canvasses.
The power of pattern recognition
Becoming an expert in pattern recognition is key to successfully using the model. The more successful models you have analyzed or created – the more likely you are to utilize similar patterns for your own models. Therefore, to truly excel, you should exercise your analytical muscle as often as possible by modeling the competition, and other successful and unsuccessful businesses.
Build, measure, learn, repeat
The magic really happens when the Lean Startup ideology is added to the final recipe. Transforming your Business Model Canvas through constant testing of your hypothesis is what really makes this process shine. Without this reiterative process in place, your hypothesis would never be proved right or wrong.