Business Model Development

 We’ve discussed the Integrated Customer Lifecycle (Customer Carousel), Business Strategy, and the Primary Business Models. Now let’s have a look at how we can change our heading to adapt to the world around us, or discover a new path for others to follow.

15.1 - BUSINESS MODEL DEVELOPMENT

We believe business models can be developed into two directions:

• BUSINESS MODEL REGENERATION (= Evolutionary)
• BUSINESS MODEL SHIFTING (= Revolutionary)

15.2 - BUSINESS MODEL REGENERATION

Business Model Regeneration is an evolution of an existing Primary Business Model ─ often driven by advancing technology. For instance, the traditional supermarket is a product-centric business model, focused on growing or defending market share, while Amazon’s Go cashier-less grocery stores are simply a contemporary regeneration (digital evolution) of a traditional business model.

We’ve created a slide to illustrate business models regenerate: ROUNDMAP™ Business Model Regeneration in Action

15.3 - BUSINESS MODEL SHIFTING

Business Model Shifting is a revolvement (clockwise) to the next Primary Business Model in the Business Model Matrix™. Shifting is, by far, the most transformative of the two. The best way to explain ‘ shifting’ (or revolving) is by looking at IBM.

15.4 - SHIFTING VERSUS REGENERATION

If we put the two together, business model shifting (revolution) and business model regeneration (evolution), this is a way to perceive it:

As stated before, shifting (the color-coded cycle) is by far the most transformative of the two. It has a huge impact on all of the dynamics (organizational, business, customer, and market). A decision to shift the business model shouldn’t be made lightly. A regeneration (dashed cycles), on the other hand, is often limited to change and innovation and, therefore, much less drastic.

15.5 - OLD BOUNDARIES REMOVED

You may perceive that the Sharing Economy is exemplary of the Digital Age, however, it isn’t. If you ever took a plane, train, or taxi, you were essentially sharing a resource. However, digital technology removed the need for a physical dispatch location which greatly improved the ease with which to hire a resource. This has allowed resource-centric businesses to grow rapidly which attracted others to the scene.

What about the Platform Economy? Well, remember the Silk Road from your history lessons? Hundreds of marketplaces had emerged along the trade routes between China and Europe. Facilitating a digital platform, often called a marketspace, is very much similar to setting up a traditional marketplace. However, without the physical constraints, marketspaces (or platforms if you will), now have a sheer unlimited reach, offering network-centric businesses an opportunity for exponential growth (Facebook, Uber, eBay, Taskrabbit, Producthunt, etc.).

"You can't connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life."

~ Steve Jobs, founder of Apple Inc.

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