Business management tool for businesses
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The document discusses strategic management tools and the business model canvas (BMC). The BMC is a strategic management tool that consists of nine building blocks that represent the key elements of a business model. It helps visualize, design, challenge, and assess business ideas or concepts. The nine blocks are customer segments, value propositions, channels, customer relationships, revenue streams, key resources, key activities, key partnerships, and cost structure. Taken together, the BMC provides a complete picture of how a company operates and creates value for customers.
Business management tool for businesses
- 3. Introduction
- 4. How can I start a new business? How can we re-evaluate and reposition our business after Covid- 19? How do we align our strategy to become one of the best in our sector? How can we upscale our present business operations? How can we pivot/transition into a new business? How can I attract business funders/partners? …….. need for strategy Management decision Some Questions looking for solution….
- 5. What’s strategic management tools? Strategic management is the ongoing planning, monitoring, analysis and assessment of all necessities an organization needs to meet its goals and objectives. The strategic management process has become more complex and costly. Therefore, in order to assist strategic managers, a wide variety of tools and techniques have been developed.
- 6. Most Strategic Management Tools
- 7. A business model is simply a plan describing how a business intends to make money. The business model canvas is a strategic management tool that lets you describe, design, visualize, challenge, invent, pivot and assess your business idea or concept. It’s a one-page document containing nine boxes that represent different fundamental elements of a business. What’s Business Model Canvas?
- 8. Building blocks of BMC
- 9. Customer Segments The heart of any business model Without profitable customer, business can’t continue Who are the customers? What do they think? See? Feel? Do? Segmenting your customers based on similarities such as geographical area, gender, age, behaviours, interests, etc. gives you the opportunity to better serve their needs, specifically by customizing the solution you are providing them. After a thorough analysis of your customer segments, you can determine who you should serve and ignore. Then create customer personas for each of the selected customer segments.
- 11. Clarity Clarify who you are selling to, and it will become much easier to refine your sales approach. Mass market Niche market Segmented Diversified Multi-sided markets
- 12. What’s compelling about the proposition? Why do customers buy, use your products? Value Propositions This is the building block that is at the heart of the BMC. And it represents your unique solution (product or service) for a problem faced by a customer segment, or that creates value for the customer segment.
- 13. A value proposition should be unique or should be different from that of your competitors. If you are offering a new product, it should be innovative and disruptive. And if you are offering a product that already exists in the market, it should stand out with new features and attributes. Value propositions can be either quantitative (price and speed of service) or qualitative (customer experience or design).
- 14. How are these propositions promoted, sold and delivered? Why? Is it working? Channels Value propositions are delivered to customers through communication, distribution, and sales Channels
- 15. Channels play a role in raising awareness of your product or service among customers and delivering your value propositions to them. There are two types of channels Owned channels: company website, social media sites, in- house sales, etc. Partner channels: partner-owned websites, wholesale distribution, retail, etc.
- 16. Driven by the following motivation: Customer acquisition, retention Boosting sales (Self service, personal assistance, automated, chat, communities Customer Relationships How do you interact with the customer through their ‘journey’?
- 17. Personal assistance Dedicated personal assistance Self-service Automated services Online Communities Co-creation Types of Relationships
- 18. How does the business earn revenue from the value propositions? Revenue Streams Customers are the heart of business and Revenue is the arteries Revenue streams result from value propositions successfully offered to customers
- 19. A revenue stream can belong to one of the following revenue models Transaction-based revenue: made from customers who make a one-time payment Recurring revenue: made from ongoing payments for continuing services or post-sale services For what value are our customers really willing to pay? For what do they currently pay? How are they currently paying? How would the prefer to pay? How much does each revenue stream contribute to overall revenue?
- 20. Asset sales: by selling the rights of ownership for a product to a buyer Usage fee: by charging the customer for the use of its product or service Subscription fee: by charging the customer for using its product regularly and consistently Lending/ leasing/ renting: the customer pays to get exclusive rights to use an asset for a fixed period of time Licensing: customer pays to get permission to use the company’s intellectual property Brokerage fees: revenue generated by acting as an intermediary between two or more parties Ways of Revenue generation
- 21. Key Activities The most important activities/actions a company must do to operate successfully. What are the activities/ tasks that need to be completed to fulfill your business purpose?
- 22. Categories of key activities •Production: designing, manufacturing and delivering a product in significant quantities and/ or of superior quality. •Problem-solving: finding new solutions to individual problems faced by customers. •Platform/ network: Creating and maintaining platforms. For example, Microsoft provides a reliable operating system to support third-party software products.
- 23. What uniquely strategic things does the business do to deliver its proposition? Physical, Human, intelligent, financial Key Resources Key Resources are the assets required to make business model work The main inputs you need to carry out your key activities in order to create your value proposition.
- 24. •Human (employees) •Financial (cash, lines of credit, etc.) •Intellectual (brand, patents, IP, copyright) •Physical (equipment, inventory, buildings) Types key resources
- 25. Who are the key partners? Who are the key suppliers? Which key resources are we acquiring from the partners? Which activities do the partners performs? Key Partners Key partners are the external companies or suppliers that will help you carry out your key activities. These partnerships are forged in order to reduce risks and acquire resources.
- 26. •Strategic alliance: partnership between non-competitors •Coopetition: strategic partnership between partners (cooperative competition ) •Joint ventures: partners developing a new business •Buyer-supplier relationships: ensure reliable supplies Types of Partnership
- 27. What are the business’ major cost drivers? How are they linked to revenue? (Fixed, Variable, Economics of scale and scope) Cost Structures
- 28. • Strategic Planning/Development • Dashboard • Understanding Competition • Portfolio of Business models • Design, test, and build new growth engines • New idea template • Understanding customers • Shared language across functions • Investment decisions Purpose of BMC