The most common and widespread tool for developing and visualizing a business model is the Business Model Canvas by Alexander Osterwalder and Yves Pigneur.
The underlying idea is, that a business model consists of nine building blocks:
Link to the original pdf template
Value Propositions, Customer Segments, Channels for delivering the value propositions, Customer Relationships maintained with each customer segment, Revenue Streams, Key Resources as assets and Key Activities required to create, offer and deliver the value propositions, Key Partnerships and Cost Structure. This video is a good introduction to the idea of the Business Model Canvas.
Based on the „Business Model Ontology” developed in 2004 by Osterwalder, the Business Model Canvas was developed together with many practitioners and shared with a Creative Common Licence. The canvas can be seen as a checklist that helps you thinking about different aspects of a business model: the structure of the canvas is fixed and the user has only to fill in the different blocks. The book „Business Model Generation“ explains how.
Moreover, there are different apps web based tools (more about web based tools and apps will be presented in one of the next blog posts), which helps you to fill out the template.
Shortly before the publication of the business model canvas Patrick Stähler developed a canvas framework. One of the major differences in this canvas is the building block „Team & Values“. It focuses on the team, on competences and on core values of the company.
Meanwhile there are many more canvas tools that used the Business Model Canvas as an inspiration and as a base for further development. One example is the framework used by HackFWD for developing and pitching business models. They added the two perspectives „competitive strategy“ and „growth strategy“ – interesting and important aspects for creating a business model. Nevertheless, the researchers differentiate between a business model and a business strategy (see Casadesus-Masanell & Ricart, 2010). The tool was introduced together with the Phase 2 Generator, where business models could be constructed, evaluated and shared. Unfortunately HackFWD does not exist anymore, but have a look at this video to get inspired by Tom Hulme.
There are many more iterations of the original business model canvas using different building blocks for creating a business model. Some examples are:
- Lean Canvas: focuses on building ideas and business models in conditions of uncertainity – a situation startups often have to deal with; therefore the Problem and the Solution as well as the key metrics are essential building blocks
- Social Business Model Canvas: helps to design social business by adding e.g. the Social Value, the Impact Measure or the Surplus (where to invest profits)
- Business Model Architect Canvas: the value proposition building block differentiates between Customer Value, Positioning, Price Level and Experience Cycle. Moreover, the Price Model is part of the building block Revenue Stream
- The Service Business Model Canvas: a theoretical approach; divides every building block of the Business Model Canvas into three layers – the customer, partner and company perspective
The Business Model Toolbox soon will provide a deeper overview on existing tools, their source, purpose and fields of application.