Business Model Innovation: Introduction to Implementation · Business Model Innovation:...
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Business Model Innovation: Introduction to Implementation Dr Michael Teng Assistant Secretary-General Singapore Manufacturing Federation DBA(UNISA), MBA(NUS), BEng, FCMI, FIMechE, FIEE, CEng, PEng, FCIM, FMIS, PMC, ACTA 24 March 2015
Transcript of Business Model Innovation: Introduction to Implementation · Business Model Innovation:...
Business Model Innovation:
Introduction to Implementation
Dr Michael TengAssistant Secretary-General
Singapore Manufacturing Federation
DBA(UNISA), MBA(NUS), BEng, FCMI, FIMechE, FIEE, CEng, PEng, FCIM, FMIS, PMC, ACTA
24 March 2015
Business Model Innovation:
How to beat your giant?
Number of Years to Reach
50 Million Audience
BicycleVS
Car
Fountain pen VS
Ball pen
Subway VS
McDonalds
VietnamVS
USA War
Singapore Airlines VS
Pan Am
Facebook VS
Myspace
Dell VS
IBM
Amazon VS
BordersSmall Japanese
VSBig cars in US
iTunes VS
Music industry
Tablet VS
Notebook
Google VS
YahooFacebook ? years
Internet 5 years
TV 13 years
Radio 28 years
The underdogs have beaten the big boys through innovation and productivity
Nokia VS
Motorola
CNN VS
NBC
Strategy 1: Find the Right NicheCustomer Competition Orientation Matrix
Low
Level of
Competition
Orientation
Level of Customer Orientation
To be a follower, understand the competitors and customers.
To be the leader, understand the market.
High
High
Competition-Driven
Myspace, Yahoo, Motorola
Market-Driven
Facebook, Google, Apple
Customer-Driven
Geocities, Netscape, Wang Computers
Internally-Driven
The Well, Archie, Creative Tech
Source: http://businessmodelgeneration.com/canvas/bmc?_ga=1.199513454.1576209768.1424664901
Strategy 2: Business Model CanvasKey PartnersWho are our Key Partners?
Who are our key suppliers?
Which Key Resources are we
acquiring from partners?
Which Key Activities do partners
perform?
Motivations for Partnerships
Optimization and economy
Reduction of risk and uncertainty
Acquisition of particular resources
and activities
Key ActivitiesWhat Key Activities do our Value
Propositions require?
Our Distribution Channels?
Customer Relationships?
Revenue streams?
Categories
Production
Problem Solving
Platform/Network
Value PropositionsWhat value do we deliver to the customer?
Which one of our customer’s problems are
we helping to solve?
What bundles of products and services are
we offering to each Customer Segment?
Which customer needs are we satisfying?
Characteristics
Newness
Performance
Customization
“Getting the Job Done”
Design
Brand/Status
Price
Cost Reduction
Risk Reduction
Accessibility
Convenience/Usability
Customer RelationshipsWhat type of relationship does each of our Customer Segments expect us to establish and
maintain with them?
Which ones have we established?
How are they integrated with the rest of our business model?
How costly are they?
Examples
Personal assistance, Dedicated Personal Assistance, Self-Service
Automated Services, Communities, Co-creation
Customer
SegmentsFor whom are we creating value?
Who are our most important
customers?
Mass Market
Niche Market
Segmented
Diversified
Multi-sided Platform
Key ResourcesWhat Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?
Types of ResourcesPhysicalIntellectual (brand patents, copyrights, data)HumanFinancial
ChannelsThrough which Channels do our Customer Segments want to be reached?
How are we reaching them now?
How are our Channels integrated?
Which ones work best?
Which ones are most cost-efficient?
How are we integrating them with customer routines?
Channel Phases
1. Awareness
How do we raise awareness about our company’s products and services?
2. Evaluation
How do we help customers evaluate our organization’s Value Proposition?
3. Purchase
How do we allow customers to purchase specific products and services?
4. Delivery
How do we deliver a Value Proposition to customers?
5. After sales
How do we provide post-purchase customer support?
Cost StructureWhat are the most important costs inherent in our business model?
Which Key Resources are most expensive?
Which Key Activities are most expensive?
Is your business more…
Cost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)
Value Driven (focused on value creation, premium value proposition)
Sample Characteristics
Fixed Costs (salaries, rents, utilities)
Variable costs
Economies of scale
Economies of scope
Revenue StreamsFor what value are our customers really willing to pay?
For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each Revenue Stream contribute to overall revenues?
Types
Asset sale
Usage fee
Subscription Fees
Lending/Renting/Leasing
Licensing
Brokerage fees
Advertising
Fixed Pricing
List Price
Product feature dependent
Customer segment
dependent
Volume dependent
Dynamic Pricing
Negotiation (bargaining)
Yield Management
Real-time-Market
strategyzer
Treatment Phase I:
Surgery
Treatment Phase II:
Resuscitation
Treatment Phase III:
Therapy
Strategy 3: Analyse the Situation for Bottlenecks
Productivity Productivity/Innovation Innovation
Identify the viruses/giants attacking the company
Determine which of the three phases of corporate
transformation and turnaround are applicable
The three phase transformation methodology will help to identify and break the bottlenecks so that the company can be faster, cheaper and better
Strategy 4: Execute Productively and
Innovatively
Productivity and innovation depend on effective & efficient corporate transformation-
improving efficiency effectively and effectiveness efficiently
Corporate Transformation Index TM
= Productivity @ Innovation
= Output/Input x Innovation Culture
Productivity is increasing revenue and decreasing costs or increasing output and
decreasing input
Innovation Culture is the measurement of the predisposition of the company to
implement innovation
Successful execution is key to any innovative and
productivity initiatives
Video: How small companies can take on the big boys
David defeated Goliath by targeting the right niche and executing
with innovativeness and productiveness
Number of Years to Reach
50 Million Audience
BicycleVS
Car
Fountain pen VS
Ball pen
Subway VS
McDonalds
VietnamVS
USA War
Singapore Airlines VS
Pan Am
Facebook VS
Myspace
Dell VS
IBM
Amazon VS
BordersSmall Japanese
VSBig cars in US
iTunes VS
Music industry
Tablet VS
Notebook
Google VS
YahooFacebook ? years
Internet 5 years
TV 13 years
Radio 28 years
The underdogs have beaten the big boys through innovation and productivity
Nokia VS
Motorola
CNN VS
NBC
Best Selling Book: Corporate Turnaround: Nursing A Sick Company Back To Health.
Endorsed by: Professor Philip Kotler, Professor Jagdish Sheth, Mr Oei Hong Leong, Dr Wong Yip Yan
1. Corporate Turnaround : Nursing a sick company back to health 15. Business Model Innovation: Introduction to Implementation
2. Internet Turnaround 16. Ancient Chinese Wisdom: Zheng He, Sun Zi, Confucius
3. Change Management Leadership 17. How the small can beat the big companies
4. Buying and selling of distressed companies 18. Jesus: The corporate turnaround expert
5. Corporate Turnaround: GlobPerspective 19. Africa, the next economic tiger: Lessons from Asia
6. Business Diagnosis 20. What we can learn from the animals about office politics
7. Turnaround Yourself 21. Office Politics Mania
8. Fundamentals of buying and selling companies 22. Admiral Zheng He: The collaborative transformational leader
9. Inspiring Notebook: Corporate Transformation 23. Business Model Innovation: Example
10. Ultimate Internet Strategy 24. Corporate Cyberwar
11. Training Manual: Corporate Turnaround Books are available for purchase at
www.amazon.com
THANK YOU
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