A blog about using business model canvas for clearer thinking.
Business models are constantly changing. The way you run your business today might not be the way you’re operating next year. While no idea is ever fully formed (and shouldn’t be), there are different ways to start thinking about the things you do and how best to go about doing them. One great way I found of doing this is by using a Business Model Canvas tool/template.
What is a business model canvas?
A business model canvas is a management tool that allows you to represent your business model on one single page. You can use it to analyze, plan and provide a visualization for your current or new business.
The business model canvas was created by Alexander Osterwalder and Yves Pigneur in their book, Business Model Generation. To date, there are more than 2 million copies of the book in circulation.
The idea of the business model canvas is to help you create a visual representation of your business — its structure, customers, operations, value proposition and finances. It’s designed to help you think through the key elements of your business and understand how they fit together.
What are the 9 building blocks of a business model canvas?
In a world of ever-changing business models, it is important to keep up with the trends. One of the most exciting things in the business world right now is the Business Model Canvas. The Business Model Canvas is a strategic management tool for developing new or documenting existing business models. It is a visual chart with elements describing a firm’s value proposition, infrastructure, customers, and finances.
To understand what this means let’s break it down into sections. The 9 building blocks of Business Model Canvas are:
Key Partners – Who are your key partners?
Key Activities – What activities are most important to your success?
Key Resources – What resources do you need?
Value Propositions – What value will you provide to customers?
Customer Relationships – How will you communicate with customers?
Channels – How will you reach customers?
Customer Segments – Who are your potential customers?
Cost Structure – What are your fixed and variable costs?
Revenue Streams – How will you make money?
Business Model Canvas is great for thinking about and managing your business.
For a lot of people, the Business Model Canvas is easier to understand than a traditional business plan because it’s more visual. It also makes it much easier to notice when things aren’t working, which means you can adapt quickly and get back on track.
I’m sure you’ve heard the old saying, “Failing to plan is planning to fail.” That’s why you need a business model. Think about it… all successful businesses have one, whether they know it or not. A business model gives you a clear view of your business so you can:
Make better decisions faster
Improve your strategy
Find opportunities for growth
Keep up with the competition
Above all, the business model canvas enables you to really see what’s going on in your business or project. After we’ve completed a canvas, we are much clearer about what we need to do next, and how to get there. If you’re thinking about getting started with the business model canvas, use this framework to think it through.