What drives a company’s success? Highlights of survey findings

by Paul Leinwand and Cesare Mainardi

Survey snapshot

A Strategy& survey shows that companies find it harder to understand their own strengths than to understand their customers. By knowing themselves well and leveraging their distinctive strengths to build a clear identity, companies can outperform their peers. But many companies aren’t basing their strategies on this insight, the study finds. In fact, companies have widely divergent views on how to develop strategy, despite evidence that a capabilities-driven approach delivers the best returns.

We find that a capabilities-driven approach to value creation leads to higher returns, on average, than other ways of doing strategy. Capabilities-driven companies owe their success to having a truly distinctive way of providing value, a powerful set of capabilities, and coherence between their strategy and their capabilities. By contrast, companies that compete on the basis of economies of scale, lucrative assets, or diversification fare less well.

We also see that companies with a clear identity — standing for something unique and consistent over time — tend to perform better than others. But how do they develop that identity? Again, a capabilities-driven approach is the answer.

Finally, the survey shows why many companies find pursuing this kind of success so hard. Their approach to strategy gets in the way: They do strategy at the margins — with a short-term perspective and too many initiatives — instead of pursuing a strategy that promotes long-term success. Contrary to common belief, most companies’ problem with strategy is not insufficient understanding of the market, but rather insufficient knowledge of and reliance on their own distinctive strengths.

Companies that embrace the challenge of building and leveraging this self-knowledge are on their way to creating greater value.

“Many companies focus too much on the outside when developing their strategy, and don’t combine that market-back perspective with a clear view of what their organization is great at doing. In this survey, as in all the research we’ve done on the topic of value creation, we see that essential advantage lies within. A few differentiating capabilities drive a company’s identity and success.”

—Cesare Mainardi, chief executive officer, Strategy&

The 10 companies with the clearest identity*

• Apple
• BMW
• Caterpillar
• Coca-Cola
• Honda
• LVMH
• Royal Dutch Shell
• Toyota
• Volkswagen
• Walmart

* Identified by survey participants from a list containing the 15 largest public companies (by market capitalization) across regions in each of seven industries.

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Key findings of the survey

Our findings provide critical insights into what drives success, the importance of a clear identity, and the top issues in strategic development.

What drives success?
The survey found that there is no dominant strategy or school of strategy. We asked survey participants to rate the importance of seven drivers of success, and their responses were surprisingly mixed. Economies of scale were rated as the most important driver of success, followed closely by powerful capabilities and lucrative assets.

For the best-performing companies, success — measured in terms of three-year growth of total shareholder return (TSR) — is attributable to what we call a capabilities-driven approach to strategy. These companies’ drivers of success most often include three distinct elements: a truly distinctive way of providing value, powerful capabilities, and coherence between the two.

Companies that owe their success to more asset-driven factors (economies of scale, lucrative assets, or diversification) have measurably lower performance.

Does identity matter?
Companies considered to have a clear identity — standing for something unique and consistent over time — have superior three-year TSR growth compared with companies that lack a clear identity.

In addition to promoting overall success, the three elements of a capabilities-driven strategy also drive a company’s strong identity, according to respondents.

Building a strong identity is very hard to do. The most challenging aspect is defining the identity and determining precisely how the company is going to add value for its customers.

What’s wrong with strategy development?
We asked respondents to rank the most problematic issues companies face in developing strategy. “Having too many strategic initiatives” was ranked as the biggest problem by more respondents (29 percent) than any other issue.

That was closely followed by “focusing too much on short-term performance improvement and too little on what will create long-term success” (27 percent of respondents).

Contrary to common belief, insufficient market focus is not the biggest problem — only 7 percent of respondents consider “ignoring external market forces” to be the most problematic issue.

Overall, only about one out of three respondents (36 percent) indicated that the top leaders of their companies were effective at both strategy development and execution, although both dimensions strongly correlate with company performance.

Key finding: Companies have widely divergent views about how to chase success

Exhibit 1: The world’s largest companies have divergent views on what drives success

• We asked survey participants to identify the most important drivers of success for the three companies they know best among the 15 largest in their industry. We found that no approach is clearly dominant.
• Pursuing economies of scale was perceived to be the most important success driver (score of 2.0), followed by powerful capabilities (1.8) and lucrative assets (1.6).

“The application of strategy to the business context is new — just about 50 years old. But in those 50 years we’ve seen countless theories, frameworks, and books being developed. The challenge now is that many companies pursue multiple theories of value creation at the same time.”

—Paul Leinwand, partner, Strategy&

Survey respondents’ perceptions of Apple and Microsoft help to illustrate the differences in how companies approach strategy. Respondents draw a very clear — and very distinct — picture of each company’s strategy.

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Exhibit 2: Comparing drivers of success for Apple and Microsoft

• Apple’s success is perceived to be primarily based on its distinctive way of providing value and the coherence between its strategy and its capabilities.
• Microsoft’s success is perceived to be primarily based on its scale and lucrative assets.

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Exhibit 3: Apple and Microsoft are perceived to have different strategic approaches

• Apple is seen as having a much more focused approach to strategy. Respondents regard it as using a clear value proposition to target a specific customer segment and focusing on a few capabilities in which it achieves excellence.
• Microsoft, on the other hand, is seen as following a more balanced approach. Respondents regard it as tailoring value propositions to various customer segments and being good across many capabilities rather than focusing on excellence in a few.

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Key finding: Companies competing with a capabilities-driven approach are more successful

Exhibit 4: Companies’ performance depends on their sources of success

• Although each of the seven success drivers listed in Exhibit 1 is used by a significant percentage of companies, they have very different impacts on companies’ success.
• The more a company’s success is perceived to be capabilities-driven — based on a clear way to play, powerful capabilities, and coherence — the more successful the company tends to be (as measured by TSR growth over three years). Companies that are seen as most consistently following such a capabilities-driven approach include Apple, Caterpillar, Honda, PetroChina, SAP, Standard Chartered, Toyota, and Volkswagen.
• Companies that are seen as competing on the basis of assets, scale, and, diversification have significantly lower TSR growth, on average, than companies that follow a capabilities-driven approach.

“Our findings are very much in line with our beliefs about capabilities. Successful companies choose a differentiating way of creating value for customers, build a bespoke system of capabilities that supports this way to play, and focus their activities on those areas that benefit from their unique strengths.”

—Cesare Mainardi, chief executive officer, Strategy&

“We have ample evidence that differentiation through capabilities leads to sustainable advantage. In fact, given the competitive intensity in today’s business environment, companies need more than just one or two great products to win in the long term — differentiation through capabilities is quickly becoming the only path to sustainable value creation in most industries. Coherent companies, in every industry we’ve studied, outperform their less coherent competitors.”

—Paul Leinwand, partner, Strategy&

Key finding: Companies with clear identities enjoy stronger performance

Exhibit 5: Companies with clear identities enjoy stronger performance

• We asked survey participants to tell us how clear an identity the various companies in their industry have — that is, how clearly those companies are perceived to stand for something unique and consistent over time.
• Their responses helped to demonstrate that a clear identity correlates with performance — the stronger the identity, the higher the company’s three-year TSR growth. The effect is significant: Companies whose identity is perceived to be clearer than the average have a three-year TSR growth that is more than 3 percentage points higher than that of their peers.

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Exhibit 6: The clarity of a company’s identity depends on its sources of success

• Companies with a clear identity compete based on the same three capabilities-related factors that drive success in general: a truly distinctive way of providing value, powerful capabilities, and coherence.
• Companies that base their success on assets, scale, and diversification are perceived to have a weaker identity.

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Key finding: Strategists’ biggest problems are having too many disconnected initiatives and not focusing on what will create long-term success

Exhibit 7: Too many initiatives and a short-term focus are the biggest issues for strategy development

• Two issues emerged as the most problematic when we asked survey respondents to rate the significance of strategic issues: having too many strategic initiatives that are disconnected and focusing too much on short-term performance. In other words, companies aren’t addressing the fundamental questions of strategy that will allow them to create long-term success.
• Contrary to common belief, insufficient market focus does not appear to be the problem — only 7 percent of respondents consider “ignoring external market forces” to be the most significant issue.
• Overall, only about one third of respondents (36 percent) indicated that their leaders were effective at both answering the fundamental questions about strategy and keeping their company on track in execution.

“Companies rarely fail simply because they don’t understand the market, but many struggle because they don’t understand and leverage what is great about themselves.”

—Paul Leinwand, partner, Strategy&

“Most companies do strategy at the margins — they look forward from their current messy and incoherent states and pursue the same trends as anyone else in the industry. This set of incremental steps ultimately leads nowhere, because many companies are all chasing after the same small set of opportunities. What companies need to do is real strategy — they need to think bigger and more long-term, working toward a differentiated position that fits their capabilities.”

—Cesare Mainardi, chief executive officer, Strategy&

About the survey

Strategy& developed this survey to better understand what drives the success of the world’s largest companies. The survey assessed the relationship between companies’ approach to value creation and their performance, and studied the role that a company’s identity plays in its success.

We conducted a Web-based survey between February and August 2013 and invited readers of HBR.org and recipients of strategy+business enews and Strategy& Foresight to participate; 720 executives (including 192 at the C-suite level) completed the survey. Participants were asked to select up to three public companies within their industry (from a list of the 15 largest in each of seven industries) and comment on what drives success for those companies as well as their own company; to identify the main challenges companies face in strategy development; and to assess the role that a strong identity plays in promoting a company’s success.

To determine a company’s score for each of seven predefined success drivers, we allocated three points to the driver selected as most important, two points to the second most important, and one point to the third most important. We then normalized the scores so that the sum for the seven drivers equals 10. To enable a comparison across companies, scores for each driver were averaged over all companies.

Based on the survey responses and the company’s performance (as measured by three-year TSR growth from January 2010 to January 2013), we established a link between companies’ success drivers and their actual success.

Learn more about Strategy&’s full body of work on how companies build their essential advantage through capabilities-driven strategy at strategyand.pwc.com/CDS.

10 Principles of Organization Design

These fundamental guidelines, drawn from experience, can help you reshape your organization to fit your business strategy.

by Gary L. Neilson, Jaime Estupiñán, and Bhushan Sethi

A global electronics manufacturer seemed to live in a perpetual state of re-organization. Introducing a new line of communication devices for the Asian market required reorienting its sales, marketing, and support functions. Migrating to cloud-based business applications called for changes to the IT organization. Altogether, it had reorganized six times in 10 years.

Suddenly, however, the company found itself facing a different challenge. Because of the new technologies that had entered its category, and a sea change in customer expectations, the CEO decided to shift from a product-based business model to a customer-centric one. That meant yet another reorganization, but this one would be different. It had to go beyond shifting the lines and boxes in an org chart. It would have to change the company’s most fundamental building blocks: how people in the company made decisions, adopted new behaviors, rewarded performance, agreed on commitments, managed information, made sense of that information, allocated responsibility, and connected with one another. Not only did the leadership team lack a full-fledged blueprint — they didn’t know where to begin.

This situation is becoming more typical. In the 18th annual PwC survey of chief executive officers, conducted in 2014, many CEOs anticipated significant disruptions to their businesses during the next five years as a result of global trends. One such trend, cited by 61 percent of the respondents, was heightened competition. The same proportion of respondents foresaw changes in customer behavior creating disruption. Fifty percent said they expected changes in distribution channels. As CEOs look to stay ahead of these trends, they recognize the need to change their organization’s design. But for that redesign to succeed, a company must make its changes as effectively and painlessly as possible, in a way that aligns with its strategy, invigorates employees, builds distinctive capabilities, and makes it easier to attract customers.

Today, the average tenure for the CEO of a global company is about five years. Therefore, a major re-organization is likely to happen only once during that leader’s term. The chief executive has to get the reorg right the first time; he or she won’t get a second chance.

Although every company is different, and there is no set formula for determining the appropriate design for your organization, we have identified 10 guiding principles that apply to every company. These have been developed through years of research and practice at PwC and Strategy&, using changes in organization design to improve performance in more than 400 companies across industries and geographies. These fundamental principles point the way for leaders whose strategies require a different kind of organization than the one they have today.

1. Declare amnesty for the past. Organization design should start with corporate self-reflection: What is your sense of purpose? How will you make a difference for your clients, employees, and investors? What will set you apart from others, now and in the future? What differentiating capabilities will allow you to deliver your value proposition over the next two to five years?

For many business leaders, answering those questions means going beyond your comfort zone. You have to set a bold direction, marshal the organization toward that goal, and prioritize everything you do accordingly. Sustaining a forward-looking view is crucial.

We’ve seen a fair number of organization design initiatives fail to make a difference because senior executives got caught up in discussing the pros and cons of the old organization. Avoid this situation by declaring “amnesty for the past.” Collectively, explicitly decide that you will neither blame nor try to justify the design in place today or any organization designs of the past. It’s time to move on. This type of pronouncement may sound simple, but it’s surprisingly effective for keeping the focus on the new strategy.

2. Design with “DNA.” Organization design can seem unnecessarily complex; the right framework, however, can help you decode and prioritize the necessary elements. We have identified eight universal building blocks that are relevant to any company, regardless of industry, geography, or business model. These building blocks will be the elements you put together for your design (see Exhibit 1).

The blocks naturally fall into four complementary pairs, each made up of one tangible (or formal) and one intangible (or informal) element. Decisions are paired with norms (governing how people act), motivators with commitments (governing factors that affect people’s feelings about their work), information with mind-sets (governing how they process knowledge and meaning), and structure with networks (governing how they connect). By using these elements and considering changes needed across each complementary pair, you can create a design that will integrate your whole enterprise, instead of pulling it apart.

You may be tempted to make changes with all eight building blocks simultaneously. But too many interventions at once could interact in unexpected ways, leading to unfortunate side effects. Pick a small number of changes — five at most — that you believe will deliver the greatest initial impact. Even a few changes could involve many variations. For example, the design of motivators might need to vary from one function to the next. People in sales might be more heavily influenced by monetary rewards, whereas R&D staffers might favor a career model with opportunities for self-directed projects and external collaboration and education.

3. Fix the structure last, not first. Company leaders know that their current org chart doesn’t necessarily capture the way things get done — it’s at best a vague approximation. Yet they still may fall into a common trap: thinking that changing their organization’s structure will address their business’s problems.

We can’t blame them — after all, the org chart is seemingly the most powerful communications vehicle around. It also carries emotional weight, because it defines reporting relationships that people might love or hate. But a company hierarchy, particularly when changes in the org chart are made in isolation from other changes, tends to revert to its earlier equilibrium. You can significantly remove management layers and temporarily reduce costs, but all too soon, the layers creep back in and the short-term gains disappear.

In an org redesign, you’re not setting up a new form for the organization all at once. You’re laying out a sequence of interventions that will lead the company from the past to the future. Structure should be the last thing you change: the capstone, not the cornerstone, of that sequence. Otherwise, the change won’t sustain itself.

We saw the value of this approach recently with an industrial goods manufacturer. In the past, it had undertaken reorganizations that focused almost solely on structure, without ever achieving the execution improvement its leaders expected. Then the stakes grew higher: Fast-growing competitors emerged from Asia, technological advances compressed product cycles, and new business models appeared that bypassed distributors. This time, instead of redrawing the lines and boxes, the company sought to understand the organizational factors that had slowed down its responses in the past. There were problems in the way decisions were made and carried out, and in how information flowed. Therefore, the first changes in the sequence concerned these building blocks: eliminating non-productive meetings (information), clarifying accountabilities in the matrix structure (decisions and norms), and changing how people were rewarded (motivators). By the time the company was ready to adjust the org chart, most of the problem factors had been addressed.

4. Make the most of top talent. Talent is a critical but often overlooked factor when it comes to org design. You might assume that the personalities and capabilities of existing executive team members won’t affect the design much. But in reality, you need to design positions to make the most of the strengths of the people who will occupy them. In other words, consider the technical skills and managerial acumen of key people, and make sure those leaders are equipped to foster the collaboration and empowerment needed from people below them.

You must ensure that there is a connection between the capabilities you need and the leadership talent you have. For example, if you’re organizing the business on the basis of innovation and the ability to respond quickly to changes in the market, the person chosen as chief marketing officer will need a diverse background. Someone with a conventional marketing background whose core skills center on low-cost pricing and extensive distribution might not be comfortable in that role. You can sometimes compensate for a gap in proficiency through other team members. If the chief financial officer is an excellent technician but has little leadership charisma, you may balance him or her with a chief operating officer who excels at the public-facing aspects of the role, such as speaking with analysts.

As you assemble the leadership team for your strategy, look for an optimal span of control — the number of direct reports — for your senior executive positions. A Harvard Business School study conducted by associate professor Julie Wulf found that CEOs have doubled their span of control over the past two decades. Although many executives have seven direct reports, there’s no universal magic number. For CEOs, the optimal span of control depends on four factors: the CEO’s tenure thus far, the degree of cross-collaboration among business units, the level of CEO activity devoted to something other than working with direct reports, and whether the CEO is also chairman of the board. (We’ve created a C-level span-of-control diagnostic to help determine your target span.)

5. Focus on what you can control. Make a list of the things that hold your organization back: the scarcities (things you consistently find in short supply) and constraints (things that consistently slow you down). Taking stock of real-world limitations helps ensure that you can execute and sustain the new organization design.

For example, consider the impact you might face if 20 percent of the people who had the most knowledge and expertise in making and marketing your core products — your product launch talent — were drawn away for three years on a regulatory project. How would that talent shortage affect your product launch capability, especially if it involved identifying and acting on customer insights? How might you compensate for this scarcity? Doubling down on addressing typical scarcities, or what is “not good enough,” helps prioritize the changes to your organization model. For example, you may build a product launch center of excellence to address the typical scarcity of never having enough of the people who know how to execute effective launches.

Constraints on your business — such as regulations, supply shortages, and changes in customer demand — may be out of your control. But don’t get bogged down in trying to change something you can’t change; instead, focus on changing what you can. For example, if your company is a global consumer packaged goods manufacturer, you might first favor a single structure with clear decision rights on branding, policies, and usage guidelines because it is more efficient in global branding. But if consumer tastes for your product are different around the world, you might be better off with a structure that delegates decision rights to the local business leader.

6. Promote accountability. Design your organization so that it’s easy for people to be accountable for their part of the work without being micromanaged. Make sure that decision rights are clear and that information flows rapidly and clearly from the executive committee to business units, functions, and departments. Our research underscores the importance of this factor: We analyzed dozens of companies with strong execution and found that among the formal building blocks, information and decision rights had the strongest effect on improving the execution of strategy. They are about twice as powerful as an organization’s structure or its motivators (see Exhibit 2).

A global electronics manufacturer was struggling with slow execution and lack of accountability. To address these issues, it created a matrix that could identify those who had made important decisions in the past few years. It then used the matrix to establish clear decision rights and motivators more in tune with the company’s desired goals. Sales directors were made accountable for dealers in their region and were evaluated in terms of the sales performance of those dealers. This encouraged ownership and high performance on both sides, and drew in critically important but previously isolated groups, like the manufacturer’s warranty function. The company operationalized these new decision rights by establishing the necessary budget authorities, decision-making forums, and communications.

When decision rights and motivators are established, accountability can take hold. Gradually, people get in the habit of following through on commitments without experiencing formal enforcement. Even after it becomes part of the company’s culture, this new accountability must be continually nurtured and promoted. It won’t endure if, for example, new additions to the firm don’t honor commitments or incentives change in a way that undermines the desired behavior.

You can often hasten the flow of information and create greater accountability by reducing layers. But if the structure gets too flat, your leaders have to supervise an overwhelming number of people. You can free up management time by adding staff, but if the pyramid becomes too steep, it will be hard to get clear messages from the bottom to the top. So take the nature of your enterprise into account. Does the work at your company require close supervision? What role does technology play? How much collaboration is involved? How far-flung are people geographically, and what is their preferred management style?

In a call center, 15 or 20 people might report to a single manager because the work is routine and heavily automated. An enterprise software implementation team, made up of specialized knowledge workers, would require a narrower span of control, such as six to eight employees. If people regularly take on stretch assignments and broadly participate in decision making, you might have a narrower hierarchy — more managers directing only a few people each — instead of setting up managers with a large number of direct reports.

9. Accentuate the informal. Formal elements like structure and information are attractive to companies because they’re tangible. They can be easily defined and measured. But they’re only half the story. Many companies reassign decision rights, rework the org chart, or set up knowledge-sharing systems — yet don’t see the results they expect.

That’s because they’ve ignored the more informal, intangible building blocks. Norms, commitments, mind-sets, and networks are essential in getting things done. They represent (and influence) the ways people think, feel, communicate, and behave. When these intangibles are not in sync with one another or the more tangible building blocks, the organization falters.

At one technology company, it was common practice to have multiple “meetings before the meeting” and “meetings after the meeting.” In other words, the constructive debate and planning took place outside the formal presentations that were known as the “official meetings.” The company had long relied on its informal networks because people needed workarounds to many official rules. Now, as part of the redesign, the leaders of the company embraced its informal nature, adopting new decision rights and norms that allowed the company to move more fluidly, and abandoning official channels as much as possible.

10. Build on your strengths. Overhauling the organization is one of the hardest things for a chief executive or division leader to do, especially if he or she is charged with turning around a poorly performing company. But there are always strengths to build on in existing practices and in the culture. Suppose, for example, that your company has a norm of customer-oriented commitment. Employees are willing to go the extra mile for customers when called upon to do so. They deliver work out of scope or ahead of schedule, often because they empathize with the problems customers face. You can draw attention to that behavior by setting up groups to talk about it, and reinforce the behavior by rewarding it with more formal incentives. That will help spread it throughout the company.

Perhaps your company has well-defined decision rights, wherein each person has a good idea of the decisions and actions for which he or she is responsible. Yet in your current org design, they may not be focused on the right things. You can use this strong accountability and redirect people to the right decisions to support the new strategy.

Conclusion

A 2014 Strategy& survey found that 42 percent of executives felt that their organization was not aligned with the strategy, and that parts of the organization resisted it or didn’t understand it. If that’s a familiar problem in your company, the principles in this article can help you develop an organization design that supports your most distinctive capabilities and supports your strategy more effectively.

Remaking your organization to align with your strategy is a project that only the top executive of a company, division, or enterprise can lead. Although it’s not practical for a CEO to manage the day-to-day details, the top leader of a company must be consistently present to work through the major issues and alternatives, focus the design team on the future, and be accountable for the transition to the new organization. The chief executive will also set the tone for future updates: Changes in technology, customer preferences, and other disruptors will continually test your business model.

These 10 fundamental principles can serve as your guideposts for any reorganization, large or small. Armed with these collective lessons, you can avoid common missteps and home in on the right blueprint for your business. 

Essential Digital Marketing Tools

5 Ways Entrepreneurs Can Stay Motivated

• Kayla Sloan

As an entrepreneur, staying motivated can make the difference between business success and business failure. Other people will appreciate your work ethic and you will have a greater chance at success.

There are other positive outcomes that could happen as a result of staying motivated as well. Your home life can improve and you may make more money in your business.

But staying motivated, regardless of the many positive reasons to do so, is not always easy to do. Below there are 5 ways entrepreneurs can stay motivated that can help you.

1. Focus on the Positives

When you are tired or lack motivation staying positive about your work is not always easy. One thing that can help you to remain motivated is to keep your focus in the right place.

Rather than keeping your attention on negative people and situations, concentrate on what is positive. Even if the only good thing about your day is that you got up and got to work, make that your focus instead. Keep working and stay thankful you are able to do so when others aren’t able.

2. Create a Mission Statement

One way entrepreneurs can stay motivated is by creating a mission statement. Are you wondering what that is and the purpose for it?

A mission statement summarizes your goals and values. It can give you direction and help you remember your purpose or reason for starting your business in the first place. Furthermore, it’s a great tool to help you stay motivated.

3. Set Goals

Setting business goals is akin to creating a business plan. To put it another way, you are creating a map of where you are going and steps for how to get there. Instead of simply plugging along in your business you will have a reason for working every day.

Think of it like the end zone in a football game. If you have ever watched football you know that the goal is to get a player in the end zone with the ball so that team can score.

Having goals is very similar. It gives you something to work towards, which can ensure that you keep working even when it’s hard.

Perhaps you are working hard so that in the future you will be able to take more vacations. Or, maybe you are working hard now so you can retire early and have more leisure time. You could be trying to have a larger nest egg for retirement.

No matter if your goals are short term or long term, having clear goals gives you an end zone to move toward in your work.

4. Get in a Routine

If you are in business for yourself and working at home some people find it hard to get started each day. Something that can help is to get into a routine.

Begin each day by getting yourself ready and then getting your cup of coffee and rolling up your sleeves to tackle your work. Or, read a short motivational story. You can find plenty of sources on the internet on Facebook or from other sources.

The point is to set up a regular routine that can help you get through your day. You might be surprised by all that you can accomplish by doing this one small thing.

5. Enjoy Small Rewards

Another way entrepreneurs can stay motivated is by enjoying small rewards. Working without ever rewarding yourself can make you begin to question why you are working in the first place. This can zap your motivation and put you on a path toward failure.

You don’t have to spend thousands to give yourself a reward. You can enjoy small rewards that help you keep your focus.

Get your favorite drink from a local coffee house once a month. Or, make a special treat at home once per week. Find something you enjoy that makes you feel good and indulge once in a while. These small rewards are what make life worth living and can keep you going.

When you want to thrive in your business, staying motivated is important. Use these ideas to stay motivated so you can reach your goals.

Top brand and data-driven marketing

Find out how top brand execs lead their organization into the modern world of data-driven marketing. Strategies are built on insights pulled from the analysis of big data, collected through consumer interactions and engagements, to form predictions about future behaviors.

How to choose the right business model?

When you need to pick a business model for your startup idea, there are many options to explore. As a guide we’ve handpicked dozens of remarkable revenue models and partnership ideas. Browse this list and copy the elements that fit your needs. Feel free to use all the examples and tools as an input for your business plan.

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How to select a new business model?
+100 slides that will help you in your selection process. In this deck we highlight different tips & tricks used by other startups.

Business Model inspiration: All types

How do I make money? 
The most common business model options used  by e-businesses and online services. This list is not limited to digital revenue streams.

Free (or nearly free) for the user:

• Early exit strategy
• Pay-what-you-want (PWYW)
• Tip jar/donation
• Freemium model
• Barter or Swapping for services
• Barter or Swapping for products

Paid (direct sales business model):

• Subscription model
• Premium model
• Pay-per-use model
• Add-ons/In-app purchases
• License fees
• Single purchase model
• Pay-as-you-go model (PAYG)

Third Party options:

• Advertisement (Ad-based) model
• Affiliate/Referral fee
• Get-one-give-one model (G1G1)
• Franchise model

Broker/Matchmaking

• Commission-based model
• Auction model

Mixed business model:

• Razor and blade model
• Crowdfunding
• Open source model
• No frills model (discount or budget model)

Business Model of Doorsteps

Doorsteps sells its online service via a subscription fee to agents and loan offices, but also takes a commission on services of other service providers, whom receive leads through the platform.

Business Model of Patients Like Me

Patients like me offers a free health community service to its users. They make money by selling the data, generated by the community, to pharmaceutical companies.

Business Model of Kaggle

Kaggle makes money in two ways: With Kaggle competition, they receive a “listening fee”for each competition posted on the platform. Also they provide a service for matching companies to the top 0,5% of their community, which they call “Kaggle Connect.

Business Model of Friendsurance

Friendsurance works as a broker between Policy Holders and existing Insurance Partners. They’re letting customers share risks with friends, allowing them to lower prices due to reduced fraud & process costs, better risk pools, …

Business Model of Gympact

With the motivational service for free, GymPact takes a cut when they pay out to members who successfully met their Pact.

Business model of Narrative

Selling camera devices ($279) + subscription service on the data storage system ($9/month). Different apps will be available, which are currently set to be included in the subscription service.

Business model of 3D Hubs

3D Hubs takes a commission of 15% on every 3D printed product, ordered through the platform.

Business model of Giffgaff

Giffgaff works as Mobile Virtual Network Operator. MVNO’s have business arrangements with traditional mobile operators to buy minutes of use (MOU) which they then sell to their own customers.

Business model of Glow

Glow sells “data insights” regarding conceiving to Research Institutions & gives exposure to trustworthy Infertility Treatment Clinics. The data is generates by users who use the Glow free fertility-tracking app.

Business model of e-École

SFR works in a partnership model with other service providers. After a set-up fee; local school administration, taking a 3 year commitment, pay a monthly subscription fee to a separate leasing company, who disburses it to the different service providers.

Business model of Shiply

Shiply works as a broker, taking a commission on transactions . Transport service providers’ bids are subjected to a tiered fee structure (4%-10%, depending on the amount of the transaction) called the success fee. Additional, an Auction Service Fee is requested which covers the online service.

Business model of Uber

Uber takes a 5-20% commission on all the rides made through it’s service. Since all payments are done automatically through the app, Uber ensures to capture a part of the transaction.

Business model of The Winner Takes All

Winner Takes All charges a transaction fee from the customers (from €0.75 for the purchase of only 1 ticket, to €0,15 per ticket for an annual subscription model).

Business model of Karma

Karma sells the Karma hotspot for $99 and additional bandwidth for $14 per gigabyte. If you like to purchase a data pack, Karma offers some discount: $50/5Gb & $180/20Gb

Business model of Sanergy

Sanergy makes money by selling fertilizer out of human manure to other companies. They collect this waste through their not-for-profit franchising brand “Fresh Life Toilets”, supporting entrepreneurs in emerging markets.

Business model of Jawbone

Jawbone UP makes money with selling data tracking wristbands at a retail price of $129.99. Users can use the free app for getting insights in this data.

Business model of 23andMe

23andMe makes money with personal genetic tests, providing reports on +240 health conditions & lineage discovery. Believed is that their DNA research studies & surveys will soon be an additional way of making money, with a mainly B2B focus instead of B2C.

Business model of AliveCor

AliveCor makes money by selling ECG devices ($199) that fit on existing smartphones and via their AliveInsights Service, a professional analysis service that makes it easy to get expert insight on your ECG readings.

Business model of Wijeya Newspaper

The partnership has two revenue streams: -A reduction in cost by lowering the ink consumption. -The supplier taking back waste material makes it possible to sell unused ink again.

Business model of AirBnB

Providing the platform for “free”, Airbnb takes a 3% commission on host ‘s earnings and asks a booking fee of 6-12% to guests for every booking they make.

Business model of Changers.com

Changers makes money with selling solar panels + batteries. In the Changers shop, where community members can redeem credits for products and services, they give exposure to green brands, which pay a commission fee for the leads.

Business model of Decide.com

Decide works as a broker between people that want to buy the best deal, and retail companies like Amazon, … Becides their free product advice, they offer a pro-service fro $2.5/month offering additional services like price guarantees, best time to buy, ….

Business model of The Humble Bundle

Humble Bundle is fully dependent on the pay-what-you-want concept. People can choose what goes to the author, charity and Humble Bundle itself (what they call the Humble tip). On average, 15% of the total funds.

Business model of SF Park

SFpark makes money with providing parking spaces in San Francisco city-area. Parking prices are incrementally raised or lowered in SFpark areas based on demand.

Business model of Asap54

ASAP54 makes money by selling items from partner retailers to consumers, upon which ASAP54 earns an average commission of 5% per item sold.

Business model of Tesla

• Drivers pre-pay their energy for the next 10 years, Tesla on its turn invests the money in the Supercharger network and makes sure the energy provided becomes cheaper.
• Competitors pay Tesla for every car using the network.

Business model of Alphabank

Alfa bank requires their new sportive customers, who are interested in the free ‘“Alfa Activity” account, to sign up for a regular bank account, which costs 59 Rubles (€1,20) per month, and a free internet account “Alfa Click.”