profit model improvement and innovation: how businesses really make money and win business model...
TRANSCRIPT
AGRICULTURE & MINING Industry SERVICE Industry
INFRASTRUCTURE/PLATFORM Management
MANUFACTURING Industry
Nespresso’s PROFIT MODEL CLASSIFICATION SYSTEM (PMCS) How Businesses Really Make Money and Win Business Model Compe66ons in the Imita6on Economy
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
GENERIC PROFIT MODEL q Luxury Spot (Differen1a1on)
q Ecosystem Management
What industry is the business (or customer) in?
AGRICULTURE & MINING Industry SERVICE Industry
INFRASTRUCTURE/PLATFORM Management
MANUFACTURING Industry
PROFIT MODEL CLASSIFICATION SYSTEM (PMCS) -‐ By Industry (Categories of Products/Services) How Businesses Really Make Money and Win Business Model Compe66ons in the Imita6on Economy
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
GENERIC POFIT MODELS
What industry is the business (or customer) in?
AGRICULTURE & MINING Industry SERVICE Industry
INFRASTRUCTURE/PLATFORM Management
MANUFACTURING Industry
PROFIT MODEL CLASSIFICATION SYSTEM (PMCS) -‐ By Sector of Industry (Categories of Products/Services) How Businesses Really Make Money and Win Business Model Compe66ons in the Imita6on Economy
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
GENERIC PROFIT MODELS
q Healthcare, Life Sciences, and Pharmaceu?cals
q Chemicals Manufacturing
q Autos, Trucks, Trains, Ships, and Other Vehicles
q Consumer Products Manufacturing
q Aerospace & Defense
q Food, Beverage, and Tobacco Manufacturing
q Mining, Metals, Energy, U?li?es, and Environmental Services
q Agriculture, Forestry, Fishing, and Hun?ng
q Insurance
q Food Services & Lodging
q Construc?on & Eng.
q Healthcare
q Banking, Fin. Markets & Services
q Consumer, Educa?on, Real Estate and Public Services
q IT Services
q Business & Consul?ng Services
q Retail q Media & Entertainment
Note: The above descrip6on of sectors is based on the IBBCS; see hGp://www.industrybuildingblocks.com/Industry-‐Groups.php
q Travel
What industry is the business (or customer) in? Who is the customer-‐protagonist (most dissa?sfied)? What is the customer Job-‐To-‐Get-‐Done? What is the profit model of the business (customer)? What are analogs and an?logs of the profit model?
AGRICULTURE & MINING Industry SERVICE Industry
INFRASTRUCTURE/PLATFORM Management
MANUFACTURING Industry
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
GENERIC PROFIT MODELS
q Consumer Products Manufacturing q Food, Beverage, and Tobacco Manufacturing
q Food Services & Lodging
q Retail
Note: The above descrip6on of sectors is based on the IBBCS; see hGp://www.industrybuildingblocks.com/Industry-‐Groups.php
What industry is the business (or customer) in? Who is the customer-‐protagonist (most dissa?sfied)? What is the customer Job-‐To-‐Get-‐Done? What is the profit model of the business (customer)? What are analogs and an?logs of the profit model?
Nespresso’s PROFIT MODEL CLASSIFICATION SYSTEM (PMCS) -‐ By Sector of Industry How Businesses Really Make Money and Win Business Model Compe66ons in the Imita6on Economy
AGRICULTURE & MINING Industry SERVICE Industry
INFRASTRUCTURE/PLATFORM Management
MANUFACTURING Industry
PROFIT MODEL CLASSIFICATION SYSTEM (PMCS) -‐ By Profit Strategies/Tac6cs/PaGerns How Businesses Really Make Money and Win Business Model Compe66ons in the Imita6on Economy
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
q Asset Sale
q Long Tail q Open Source Collabora?on q Dona?on q SoTware as a Service
q Two-‐sided Market
q Asset Sale
q Razor Blade (Bait & Switch)
q Subscrip?on Fee
q Crowdsourcing
q Lending/Ren?ng/Leasing
q Licensing
q Licensing
q Brokerage
q Usage Fee
q Asset Sale
q Adver?sing q Co-‐crea?on
q Usage Fee
q Mul?-‐sided Market PlaXorm
q Ad Network
q Outsourcing
q Ecosystem Management
q Direct Sale q Indirect Sale
q Offline
q Online
q Discount
q Tiered Payment
q Auc?on
q Facilitated Network
q Brand Mul?plier
q Reverse Auc?on
q Customiza?on
q Cross-‐subsidiza?on q Franchise
q Product Leadership
q Automa?on (Self-‐service)
q Gamifica?on
q B2C q B2B
q Pre-‐Payment
q Fair Pricing
q Community (Hub)
q On Demand
q DIY
q Unbundling q Unbundling q Bundling q Free
GENERIC PROFIT MODELS
q P2P PlaXorm
q Landlord
q Leasing
q 2nd Hand
q Luxury Spot (Differen1a1on)
q Disrup1on Spot (Low Cost; Lean)
q Blue Ocean (Value Innova1on)
q Creator
q Distributor q Broker
q Sweet Spot
q Product Extension
q Opera?onal Excellence
q Frac?onaliza?on q Customer In?macy q Affiliates
What industry is the business (or customer) in? Who is the customer-‐protagonist (most dissa?sfied)? What is the customer Job-‐To-‐Get-‐Done? What is the profit model of the business (customer)? What are analogs and an?logs of the profit model?
q Shared Value
AGRICULTURE & MINING Industry SERVICE Industry
INFRASTRUCTURE/PLATFORM Management
MANUFACTURING Industry
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
q Asset Sale
q Asset Sale
q Outsourcing
q Ecosystem Management
q Direct Sale
q Offline
q Online
q Product Leadership
q Automa?on (Self-‐service)
q Pre-‐Payment
q Community (Hub)
GENERIC PROFIT MODEL
q Shared Value
q Product Extension
q Customer In?macy
What industry is the business (or customer) in? Who is the customer-‐protagonist (most dissa?sfied)? What is the customer Job-‐To-‐Get-‐Done? What is the profit model of the business (customer)? What are analogs and an?logs of the profit model?
q Luxury Spot (Differen1a1on)
q Brand Mul?plier
Nespresso’s PROFIT MODEL CLASSIFICATION SYSTEM (PMCS) -‐ Profit Strategies/Tac6cs/PaGerns How Businesses Really Make Money and Win Business Model Compe66ons in the Imita6on Economy
q Bundling
Disrup1on Spot
Luxury Spot
Strategic Choice
Sweet Spot Profit Model
Blue Ocean Profit Model
Luxury Spot (“Differen?a?on”)
Profit Model
DisrupLon Spot/Lean (“Low Cost”) Profit Model
ILLUSTRATION OF THE 4 GENERIC PROFIT MODELS
Trade-‐off Map of Cost vs. Revenue
(-‐): PAIN: Cost
(+): DELIGHT: Revenue
Key Profitable Model Unprofitable Model
“Insane” Happiness (Value) Ideal Final Result (IFR) Infinite Shared Happiness
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
Market Segment (Job-‐To-‐Get-‐Done/Goal; Product/Tool): ………………..…..……..…….………… ……………………………………………………………………….…………….………….……………….
Disrup1on Spot
Luxury Spot
Strategic Choice
Sweet Spot Profit Model
Blue Ocean Profit Model
Luxury Spot (“Differen?a?on”)
Profit Model
DisrupLon Spot/Lean (“Low Cost”) Profit Model
GENERIC PROFIT MODEL of Nespresso
Trade-‐off Map of Cost vs. Revenue
(-‐): PAIN: Cost
(+): DELIGHT: Revenue
“Insane” Happiness (Value) Ideal Final Result (IFR) Infinite Shared Happiness
#VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing
Market Segment (Job-‐To-‐Get-‐Done/Goal; Product/Tool): Drink coffee
Key Profitable Model Unprofitable Model
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
PROFIT MODEL
ENVIRONMENT
PROFIT MODEL STORYTREE For Nespresso
Generic Profit Model Management: Visualize the Abrac?veness of Your Profit Model
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
PROFIT MODEL
PROFIT MODEL STORYTREE For Nespresso
Indu
stry Ecosystem
(IE): Sup
ply
Market E
cosystem
(ME): D
eman
d
Key Trends & Complementors (KTC): PESTLIED (-‐/+)
Macro-‐Economic Influencers (MEI): Global Economy
Generic Profit Model Management: Visualize the Abrac?veness of Your Profit Model
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
PROFIT MODEL
Generic Profit Model Management: Visualize the Abrac?veness of Your Profit Model
PROFIT MODEL STORYTREE For Nespresso
Bargaining Pow
er of Sup
pliers
Bargaining Pow
er of C
ustomers
Threat of New Entrants
Threat of SubsLtute Products
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
Inputs/Partners q Coffee Machine Manufactur-‐
er q Coffee q Coffee Growers
Internal Resources q Employees q Patents/IP q Brand q Plant (for Producing Pods)
Processes/AcLviLes q Produc6on q Marke6ng/Branding q Distribu6on/Logis6cs
Product/Value ProposiLon q Nespresso Coffee Machine q Nespresso Pods
q Best Quality Coffee at Home/in Office
Channels & RelaLonships q Retail (Machines Only) q Nespresso.com q Nespresso Bou6ques q Mail Order; Call Center q Nespresso Club
Customer/Job-‐To-‐Get-‐Done q Luxury Spobers (High Enders)
Who Are Struggling to Find High Quality Coffee at Home/Office
q Drink High Quality Coffee at Home/in Office
Cost: (Structure/Metrics) High Cost q Supplies/Inputs q Employees/IP q Machinery/Produc6on q Marke6ng/Distribu6on
Revenue: (Streams/Metrics) High Revenue q Sale of Coffee Machine q Sale of Pods/Capsules q Sale of Other Machine
Accessories
PROFIT q High Profit Margin
PROFIT MODEL STORYTREE For Nespresso
PROFIT MODEL
Strategic Profit Model Management: Visualize Your Profit Model
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
Inputs/Partners
Internal Resources
Processes/AcLviLes
Product/Value ProposiLon
Channels & RelaLonships
Customer/Job-‐To-‐Get-‐Done
Cost: (Structure/Metrics)
Revenue: (Streams/Metrics)
PROFIT
PROFIT MODEL STORYTREE …………………………………………………..
PROFIT MODEL
Strategic Profit Model Management: Visualize Your Profit Model
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
Inputs/Partners q What material, informa?on,
and capital are needed prior to launching product?
q What partners/alliances are needed?
Internal Resources q Who are team members? q What hard assets (equip-‐
ment/infra’) will are needed prior to launching product?
q What technology is needed?
Processes/AcLviLes q What are development
ac6vi6es that must be completed prior to launching product/service/tool?
Product/Value ProposiLon q What product/service/tool will
customer use and/or buy? q Why will customer buy product/
service/tool?
Channels & RelaLonships q How will product/service/tool
be delivered to customer? q What sort of rela6onship will
business have with customer? q How will customer be engaged,
acquired, and retained?
Customer/Job-‐To-‐Get-‐Done q What customer will use and/or
buy product/service/tool? q What job is customer trying to
get done? What are obstacles? q What is customer pain? q What is customer delight?
Cost: (Structure/Metrics) q At what price will customer
buy product/service/tool? q What effort will customer
expend in buying product? q What is customer acqu. cost? q What is annual total cost?
Revenue: (Streams/Metrics) q How soon will customer buy? q How many and oTen will
customer buy? q How will customer pay? q What will be annual total
revenue?
PROFIT q What will be the annual
profit margin? q What will be the annual
profit?
PROFIT MODEL STORYTREE …………………………………………………..
PROFIT MODEL
Strategic Profit Model Management: Ques?ons
Note: The above ques6ons are based on John Mullins and Randy Komisar’s book, “Gefng to Plan B”
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL (“Build”)
VALUE PROPOSITION MODEL (“Discover”; “Plan”)
Inputs/Partners q Materials/Supplies q Informa6on q Investment Capital q Strategic Alliances/Partners q Co-‐creators/Contractors
Internal Resources (Physical/Intellectual/Emo?onal/Spiritual Resources) q Employees q Machinery/Infra’ Facili6es q Technology/IP q Brand/Culture
Processes/AcLviLes q Discover q Plan q Build q Measure q Learn
Product/Value ProposiLon q Value Proposi6on Requirements q Value Proposi6on Statement q Product/Service/Tool: Features
Channels & RelaLonships q Online Channels q Offline Channels
Customer/Job-‐To-‐Get-‐Done q Customer-‐Protagonist q Cri6cal Problem q Task/Job-‐To-‐Get-‐Done q Constraints/Obstacles q Success Criteria (Outcomes)
Cost: (Structure/Metrics) q Cost of Customer Acquisi6on q Total Cost q Opera?ng Cost q Working Capital
Revenue: (Streams/Metrics) q E: Engagement q A: Acquisi6on q A: Ac6va6on q R: Reten6on q R: Referral q R: Revenue
Value: Profit q High Profit Margin (Price):
Low Volume; Low Velocity q Low Profit Margin (Price):
High Volume; High Velocity q Gross Margin q Customer Life6me Value
PROFIT MODEL (“Measure”)
Profit Model Management (Checklist) PROFIT MODEL STORYTREE
(“Learn”)
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
VALUE CREATION MODEL
VALUE PROPOSITION MODEL
PROFIT MODEL
ENVIRONMENT
PROFIT MODEL STORYTREE …………………………………………………..
Generic Profit Model Management: Visualize the Abrac?veness of Your Profit Model
Past Profit Model
Present Profit Model
Future Profit Model
Profit Model (PM) PLAN
Profit Model Design Toolkit for Thriving in a Vola?le, Uncertain, Complex, and Ambiguous (VUCA) Environment
Profit Model
(StoryTree)
Profit Model
(StoryTree)
Profit Model
(StoryTree)
Industry Ecosystem
Market Ecosystem
Profit Model (StoryTree)
Macro-‐Economic Influencers
Key Trends & Complementors
Mission/Vision/Purpose/Ideals/ Ideal Final Result For Profit Model
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
Past Profit Model
Present Profit Model
Future Profit Model
Nespresso’s Profit Model (PM) PLAN
Profit Model Design Toolkit for Thriving in a Vola?le, Uncertain, Complex, and Ambiguous (VUCA) Environment
Profit Model
(StoryTree)
Profit Model
(StoryTree)
Profit Model
(StoryTree)
Industry Ecosystem
Market Ecosystem
Profit Model (StoryTree)
Macro-‐Economic Influencers
Key Trends & Complementors
Mission/Vision/Purpose/Ideals/ Ideal Final Result: “A Passion for Quality, Innova1on and Privileged Rela1onships With Cus-‐ tomers”
#VPGen. Dr. Rod King. [email protected] & h^p://businessmodels.ning.com & h^p://twi^er.com/RodKuhnKing
Contact
Dr. Rod Kuhn King [email protected] VDD University for Profit Model Design & Management hGp://businessmodels.ning.com hGp://twiGer.com/RodKuhnKing
“No Entrepreneur LeT Behind (NELB)” #VPGen. Dr. Rod King. [email protected] & hGp://businessmodels.ning.com & hGp://twiGer.com/RodKuhnKing