COVID19 Business Model Thinking Business Model Thinking Helps
COVID-19 & Business Model Thinking • Business Model Thinking • Helps groups think holistically about impact of COVID-19 on product line, division, organization, partners, ecosystem • Help identify innovations / pivots throughout the organization to address changing user needs and evolving business ecosystem • Short Term: Identify Immediate, essential modifications “Simplify & Innovate” (& understand the impact throughout your model / organization) • Mid-Term: Position yourself to address post-COVID-19 “new normal” (complement to scenario or other forecasting tools) • Long-Term: Your competitive advantage is less about products or services and more about organizational agility, adaptive business models, and ability to anticipate or react quickly to changes.
Business Model Perspective “A business model describes the rationale of how an organization creates, delivers, and captures value. ” “. . . it is like the DNA of an organization”
Is enabled by these channels & relationships Business Model Canvas Tool Creating For these customers And requires these These add up to These create your Products & w/ these activities, Cost Structure revenue streams Services / jobs resources, & value partners If costs are greater than revenue you have a problem… https: //www. youtube. com/watch? v=Qo. AOz. MTLP 5 s
Value Proposition Canvas – Plugin for BMC https: //www. youtube. com/watch? v=Re. M 1 uqm. Vf. P 0
Amount of innovations in each category during the last 10 years
Increased profits due to each innovation category during the last 10 years Innovations outside of products have disproportionately large impact on organizations bottom-line
Overcoming Challenges w/ Business Model Innovation • Scenario #1: You must modify your business model to make/sell products (e. g. , shifting from retail to online delivery, delivering remote services, scaling infrastructure, shifting manufacturing / supply chain, etc…) Discussion: • Do you have examples from your company or others of these types of pivots? • Are the pivots temporary or might there be value in the new channels / models?
Overcoming Challenges w/ Business Model Innovation • Scenario #2: You are well equipped to deliver new value given evolving situation Includes expanding product lines OR expanding into new markets (often via alliance) (e. g. , serve medical, online engagement, logistics, data analytics, or tech directly relevant to expanding needs / sectors) Discussion: • Do you have examples from your company or others of these types of pivots? • Do new models provide substantial revenue or about social benefit / PR / Brand?
Overcoming Challenges w/ Business Model Innovation • Scenario #3: Product/Service Line “On Hold” – some companies launch non-revenueproducing models to build / maintain relationships with clients. Critical to appreciate COVID-19 acceleration of trends: going online, AI & Analytics, etc… (e. g. , travel or tourism, in-person conferences, etc…) Discussion: • Have you encountered this situation and found new models to connect to customers? • Are these new revenue opportunities or otherwise have value long-term?
Overcoming Challenges w/ Business Model Innovation • Scenario #4: Opportunities for more fundamental business model pivots (e. g. , using different revenue model to take on some risk in exchange for higher returns) Discussion: • Are any organizations exploring fundamentally new business models (sort or long term)?
Overcoming Challenges w/ Business Model Innovation • Question Assumptions: What is fixed vs. flexible? • Understand unknowns / risks when exploring adjacencies • Business Model Design approaches (e. g. , Epicenters of Innovation)perspectives can help you turn a business model pivot into a new virtuous cycle.
Business Modeling [Design] (Identify New Business Models - SMR)
Maintaining a Culture of Innovation • Cost cutting can destroy culture of collaboration, learning, & innovation • Maintain the priority on innovation • • Communicate w/ employees Use Innovation challenges to engage employees Reward innovation (and smart experimentation) Be more open – both across your organization and w/ external communities • Facilitate collaboration / knowledge sharing across barriers • Knowledge sharing practices (e. g. , mentoring, R&D fairs, communities of practice) can transfer knowledge across barriers (including tacit knowledge). • Be conscious of NEW barriers as a result of COVID-19 & enact new programs to transfer knowledge across these barriers.
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