Innovation Process

Business Model

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 LEARNING OUTCOMES

• Be able to design a business model by using a tool such as Business Model Canvas.

• Understand the value propositions, customer relationships, channels, and customer segments of the
Business Model Canvas.

• Understand the key activities, key partners and key resources of the Business Model Canvas.

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 Business model canvas

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 Business Model Canvas
• The Business Model Canvas was proposed by Alexander Osterwalder based on his earlier
book: Business Model Ontology.

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• It outlines nine segments which form the building blocks for the business model in a nice one-page
canvas.
• You can find a detailed explanation in his bestselling book “Business Model Generation”.
• Unpacking innovation: ideas, learnings and methods to help you further understanding and practice
of innovation. Sources to be referred; https://www.strategyzer.com/library/the-business-model-
canvas

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 Why do we need Business Model Canvas?

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 Customer Segments

• What customer groups will your business serve?

• Identify the customer personas that your business provides value for.

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 Value Propositions
• What products and services do you plan to offer?
• What customer needs do they meet?
• How do they differentiate your business from your competition?

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 Why do we need the value proposition canvas?

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 Customer relationships
• What relationships will you build with your customer segments?
• What kind of relationship does each customer segment expect?

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 Channels
• What distribution methods will you use to deliver your products or services to your target market?

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 Revenue streams

• How will your business make money?

• How will you price your products and services?

• Are there other potential revenue streams?

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• You can create a business model canvas on paper or a whiteboard.

• There are also several apps you can use to create your business model canvas; they allow you to
incorporate additional information, easily save and share the business model canvas, and more.

• A good business model canvas tool to be referred;

– https://www.strategyzer.com/
– https://canvanizer.com/
– https://xtensio.com/business-model-canvas-template/

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 Sources to be referred
• Osterwalder explaining the business model canvas; https://www.youtube.com/watch?v=RzkdJiax6Tw
• Competing on business models; https://www.youtube.com/watch?v=kIxs_BY6r6I
• Value Proposition Design; https://www.youtube.com/watch?v=b_X18bmpHaw
• Designing your Value Proposition; https://www.youtube.com/watch?v=pwRL4GiA8Ek

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 Business model canvas

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 Key Resources
• What essential resources are needed to launch and run your business and create value for your
customers?

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 Key Activities
• What are the most important actions you need to take in order to fulfill your value propositions,
strengthen customer relationships, secure distribution channels, and maximise revenue streams?

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 Key Partners
• Who are the buyers, suppliers, partners, and other alliances that can help you accomplish core
business activities?

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 Business model canvas

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 Cost structure
• What will it cost to start and sustain your business?
• Which resources and activities will be the most expensive?
• How to Build a Startup; https://www.youtube.com/watch?v=f_HEz1ET1JE

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 Case Study for Online Forum 4

• Prepare the business model canvas on your business idea including all 9 segments.

• Capitalise on the recognition and reputation of the existing brand (launch new products or services)
to enter new markets and increase revenue streams.

• Focus on:
– Value propositions
– Customer segments
– Customer relationships
– Channels

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