Advanced Visual Business Modeling - or -
How to ÂťPrototypeÂŤ a Business Ecosystem? Design Thinking Barcamp Hamburg, August
st 31
2013
n e g d e i m h c S _ n a J @
Everyone wants to become a “Platform Business�
Consumer
Business-to-Business
m e t s y s o c E s s e n i s u B ! s m e t s y s o c E e c i v r e S / t c u d o r P
Image Credit: Š 2012 Subprint (http://subprint.com/blog/it%27s-the-ecosystem,-stupid) http://subprint.com/blog/it%27s-the-ecosystem,-stupid
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We all love the Business Model Canvas ‌ and it’s manifold derivates! But they all have the same problem ...
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Hardware OEM's: e.g. Foxconn
Other Stakeholders
Lowest Production Costs
Sponsoring / Discounts Manufacturing High Volume and Knowledge Planning Certainty
Schools and Universities
Service Contract Infrastructure Management
Core Value Proposition
Bulk Purchases
Technical Backend Providers: e.g. SAP
IP royalties / Commission
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
IP royalties
Microsoft, Google, etc.
Complementary Offerings
New Business Ideas
Personal Data
Apple
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Media Industries
Sales Platform
Seamless User Experience
Developer Community
Technical and Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Apple Communities
Goods & Services
Software Developers: e.g. Adobe
Broad Service Station Covering
Higher Margins via Apple Price Premium
Retail/Certified Partners: e.g. Gravis Official Accessory Manufacturers: e.g. Belkin
Supplying and Enabling Network
Money & Credits
Choices & Consequences
Activity Networks
Value Flow Mapping for Ecosystems
Value Configuration Perspective: Chains/Shops/Networks
Tom Hulmes Canvas (IDEO)
Patrick Stählers Canvas (Fluidmind)
Information
Intangible Value
etc. Other »Scientific Conceptualisations«
Fraunhofer IAO Canvas
Image Credits / Sources in order of appearance: Casadesus-Masanell, R., & Ricart, J. E. (2011). How to Design A Winning Business Model. Harvard Business Review, 89(1/2), 100–107. // Porter, M. E. (1996). What is Strategy? Harvard Business Review, (November - December). // Ouden, E. den. (2011). Innovation Design: Creating Value for People, Organizations and Society (1st ed.). Springer London. // Fjeldstad, Ø. D., & Stabell, C. B. (1998). Configuring Value for Competitive Advantage: On Chains, Shops, and Networks. Strategic Management Journal,, Vol 19, 413–437. // valuenetworksandcollaboration.com, 2011 // Tom Hulme (http://weijiblog.com/ startup-tools/) // Patrick Stähler (http://blog.business-model-innovation.com/tools/) // Johnson, M. W., Christensen, C. M., & Kagermann, H. (2008). Reinventing Your Business Model. Harvard Business Review, 86(12), 50–59. // Fraunhofer IAO (http://moby.iao.fraunhofer.de/)
Hardware OEM's: e.g. Foxconn
Other Stakeholders
Lowest Production Costs
Sponsoring / Discounts Manufacturing High Volume and Knowledge Planning Certainty
Schools and Universities
Service Contract Infrastructure Management
Core Value Proposition
Bulk Purchases
Technical Backend Providers: e.g. SAP
IP royalties / Commission
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
IP royalties
Microsoft, Google, etc.
Complementary Offerings
New Business Ideas
Personal Data
Apple
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Media Industries
Sales Platform
Seamless User Experience
Developer Community
Technical and Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Apple Communities
Goods & Services
Software Developers: e.g. Adobe
Broad Service Station Covering
Higher Margins via Apple Price Premium
Retail/Certified Partners: e.g. Gravis Official Accessory Manufacturers: e.g. Belkin
Supplying and Enabling Network
Money & Credits
Activity Networks
Value Flow Mapping for Ecosystems Intangible Value
}
Choices & Consequences
Information
Systemic representations
Value Configuration Perspective: Chains/Shops/Networks
Tom Hulmes Canvas (IDEO)
Patrick Stählers Canvas (Fluidmind)
etc. Other »Scientific Conceptualisations«
Fraunhofer IAO Canvas
Image Credits / Sources in order of appearance: Casadesus-Masanell, R., & Ricart, J. E. (2011). How to Design A Winning Business Model. Harvard Business Review, 89(1/2),, 100–107. // Porter, M. E. (1996). What is Strategy? Harvard Business Review, (November - December). // Ouden, E. den. (2011). Innovation Design: Creating Value for People, Organizations and Society (1st ed.). Springer London. // Fjeldstad, Ø. D., & Stabell, C. B. (1998). Configuring Value for Competitive Advantage: On Chains, Shops, and Networks. Strategic Management Journal,, Vol 19, 413–437. // valuenetworksandcollaboration.com, 2011 // Tom Hulme (http://weijiblog.com/ startup-tools/) // Patrick Stähler (http://blog.business-model-innovation.com/tools/) (http://blog.business-model-innovation.com/tools/) // Johnson, M. W., Christensen, C. M., & Kagermann, H. (2008). Reinventing Your Business Model. Harvard Business Review, 86(12), 50–59. // Fraunhofer IAO (http://moby.iao.fraunhofer.de/) /)
Hardware OEM's: e.g. Foxconn
Other Stakeholders
Lowest Production Costs
Sponsoring / Discounts Manufacturing High Volume and Knowledge Planning Certainty
Schools and Universities
Service Contract Infrastructure Management
Core Value Proposition
Bulk Purchases
Technical Backend Providers: e.g. SAP
IP royalties / Commission
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
IP royalties
Microsoft, Google, etc.
Complementary Offerings
New Business Ideas
Personal Data
Apple
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Media Industries
Sales Platform
Seamless User Experience
Developer Community
Technical and Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Apple Communities
Goods & Services
Software Developers: e.g. Adobe
Broad Service Station Covering
Higher Margins via Apple Price Premium
Retail/Certified Partners: e.g. Gravis Official Accessory Manufacturers: e.g. Belkin
Supplying and Enabling Network
Money & Credits
Choices & Consequences
Activity Networks
Value Flow Mapping for Ecosystems
Value Configuration Perspective: Chains/Shops/Networks
Tom Hulmes Canvas (IDEO)
Patrick Stählers Canvas (Fluidmind)
Information
Intangible Value
etc. Other »Scientific Conceptualisations«
Fraunhofer IAO Canvas
Image Credits / Sources in order of appearance: Casadesus-Masanell, R., & Ricart, J. E. (2011). How to Design A Winning Business Model. Harvard Business Review, 89(1/2),, 100–107. // Porter, M. E. (1996). What is Strategy? Harvard Business Review, (November - December). // Ouden, E. den. (2011). Innovation Design: Creating Value for People, Organizations and Society (1st ed.). Springer London. // Fjeldstad, Ø. D., & Stabell, C. B. (1998). Configuring Value for Competitive Advantage: On Chains, Shops, and Networks. Strategic Management Journal,, Vol 19, 413–437. // valuenetworksandcollaboration.com, 2011 // Tom Hulme (http://weijiblog.com/ startup-tools/) // Patrick Stähler (http://blog.business-model-innovation.com/tools/) (http://blog.business-model-innovation.com/tools/) // Johnson, M. W., Christensen, C. M., & Kagermann, H. (2008). Reinventing Your Business Model. Harvard Business Review, 86(12), 50–59. // Fraunhofer IAO (http://moby.iao.fraunhofer.de/) /)
It is not like ‌
It is more like ...
Service Ecology Map
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Value Network Analysis (VNA)
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Process Map, Net Map, Actors Map
Value Network/Ecosystem Mapping
Image Credit (in order of appearance): Allee, V. (2008). Value network analysis and value conversion of tangible and intangible assets. Journal of Intellectual Capital, 9(1), 5–24.; Design Thinkers Academy
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“
Economic community supported by a foundation of interacting organizations and individuals - the 'organisms' of the business world. [...] Over time they co-evolve in their capabilities and roles, and tend to align themselves with the directions set by one or more central companies. James F. Moore (1997)
„
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The Rise of Ecosystems New Rules for Value Creation
Contemporary Understanding of Value Propositions
“
Value propositions should be crafted: as a reciprocal exchange of value; described in terms of perceived benefits or reduced costs; transparent about to whom that value should flow and how; perceived as a fair exchange of value; delivered over a time frame longer than a single transaction; often co-created through interaction between two or more parties; and, congruent with the relationship objectives set for a particular market. Ballantyne, Frow, Varey & Payne (2011)
„
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Business Ecosystem?
“A value network model visualizes specific interactions within the network to provide a perspective for understanding value-creating roles and relationships, and to offer a dynamic view of how both financial and non-financial assets are converted into negotiable forms of value.� Elke den Ouden, Phillips Industry Consulting (2011)
Image Credit: http://www.elkedenouden.com/AboutElke.html
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Customer
Supplier
Godfather
Competitor
Intermediary
Enabler
Financier
Provider of Content
Provider of Goods
Marketing & Communications
Provider of Services
Provider of Systems
Align and Balance Value Flows
Goods & Services
Goods & Services
Money & Credits
Money & Credits
Information
Information
Intangible Value
Intangible Value
Apple’s Business Ecosystem (Excerpt) Hardware OEM's: e.g. Foxconn
Other Stakeholders Lowest Production Costs Sponsoring / Discounts High Volume and Planning Certainty
Schools and Universities
Manufacturing Knowledge
Service Contract Infrastructure Management
Technical Backend Providers: e.g. SAP
IP royalties / Commission
Core Value Proposition
Bulk Purchases
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
New Business Ideas
IP royalties
Microsoft, Google, etc.
Complementary Offerings
Personal Data
Apple Platform
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Media Industries
Sales Platform
Seamless User Experience
Developer Community
Technical and Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Apple Communities
Goods & Services
Software Developers: e.g. Adobe
Broad Service Station Covering
Higher Margins via Apple Price Premium
Retail/Certified Partners: e.g. Gravis Official Accessory Manufacturers: e.g. Belkin
Supplying and Enabling Network
Money & Credits Information Intangible Value
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Layers of a Value Web Hardware OEM's: e.g. Foxconn
Other Stakeholders Lowest Production Costs Sponsoring / Discounts High Volume and Planning Certainty
Schools and Universities
Manufacturing Knowledge
Service Contract Infrastructure Management
Technical Backend Providers: e.g. SAP
IP royalties / Commission
Core Value Proposition
Bulk Purchases
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
New Business Ideas
IP royalties
Microsoft, Google, etc.
Complementary Offerings
Personal Data
Apple Platform
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Media Industries
Sales Platform
Seamless User Experience
Developer Community
Technical and Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Apple Communities
Goods & Services
Software Developers: e.g. Adobe
Broad Service Station Covering
Higher Margins via Apple Price Premium
Retail/Certified Partners: e.g. Gravis Official Accessory Manufacturers: e.g. Belkin
Supplying and Enabling Network
Money & Credits Information Intangible Value
16
Apple’s Business Ecosystem (Excerpt) Ž
Other Stakeholders Lowest Production Costs Sponsoring / Discounts High Volume and Planning Certainty
Manufacturing Knowledge
Service Contract Infrastructure Management IP royalties / Commission
Core Value Proposition
Bulk Purchases
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
New Business Ideas
IP royalties Personal Data
Apple Platform
Price Premium (Hardware, Media and App Sales) Reputation
Comission
Complementary Offerings
App Purchases Sales Platform
Seamless User Experience
Technical and Sales Training Higher Margins : Apple Price Premium Enriched User Experience
Broad Service Station Covering
Supplying and Enabling Network
Higher Margins via Apple Price Premium TM
Goods & Services Money & Credits Information Intangible Value
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Virtuous Cycles Hardware OEM's: e.g. Foxconn
Lowest Production Costs Sponsoring / Discounts High Volume and Planning Certainty
Schools and Universities
Manufacturing Knowledge
Service Contract Infrastructure Management
Technical Backend Providers: e.g. SAP
IP royalties / Commission
Bulk Purchases
???
Reputation and Awareness
Digital Sales Channel with DRM and wide Spread
Media Delivery
Apple on Campus ???
New Business Ideas
IP royalties
Microsoft, Google, etc.
Personal Data
Apple Platform
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Media Industries
Sales Platform
Seamless User Experience
Developer Community
Technical and Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Apple Communities
Goods & Services
Software Developers: e.g. Adobe
Broad Service Station Covering
Higher Margins via Apple Price Premium
Retail/Certified Partners: e.g. Gravis Official Accessory Manufacturers: e.g. Belkin
Money & Credits Information Intangible Value
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Hardware OEM's: e.g. Foxconn
Virtuous Cycles Lowest Production Costs
ponsoring / Discounts Manufacturing High Volume and Knowledge Planning Certainty
Service Contract Infrastructure Management IP royalties / Commission
Bulk Purchases
???
Reputation and Awareness
Digital Sales Channe DRM and wide Spr
Media Delivery
Apple on Campus ???
New Business Ideas
IP royalties Personal Data
Apple Platform
Price Premium (Hardware, Media and App Sales) Reputation
Comission App Purchases
Seamless User Experience
Sales Platform Technical and Sales Training
Apple Users
Developer Communit
Higher Margins : Apple Price Premium Enriched User Experience
Broad Service Station Covering
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Hardware OEM's: e.g. Foxconn
Virtuous Cycles Lowest Production Costs
ponsoring / Discounts Manufacturing High Volume and Knowledge Planning Certainty
Service Contract Infrastructure Management IP royalties / Commission
Value of the core o"er
Bulk Purchases
Sales
Reputation and Awareness
Value of the total o"er
???
Digital Sales Channe DRM and wide Spr
Media Delivery
Investment in the core innovation and capacity
Apple on Campus
???
Profits
New Business Ideas
IP royalties Personal Data
Apple Platform Investment in the business ecosystem
Price Premium (Hardware, Media and App Sales) Reputation
Seamless User Experience
Comission App Purchases
Sales Platform
Generic virtuous loop ofTechnical a business ecosystem and
Developer Communit
Sales Training
Apple Users
Higher Margins : Apple Price Premium Enriched User Experience
Broad Service Station Covering
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Your Challenge: Call-a-Drone
Core Value Proposition
FLY TO
ME
Just-at-time! pizza
s l a c i t u e c a m r a h p y c emergen g n i l u d e h c s l e c r a p P 2 P last m ile par rier u o c r i a cel del ivery
Airspeed transportation: delivered to your window - when you want it and where you want it.
Image Credit: CC-licensed “Quadrocopter� from ka!eeringe ! http://www.flickr.com/photos/ka!eeringe/8722017781/
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EX
Exercise I: Collect Actors/Stakeholders
ER E IS C
Title/Function of Actor Compatibilty with VP (positive, neutral, negative) Influence (size of indicator)
Primary Motivations
1 0 MI :0 NU 0 T
Time Horizon (throughput time) Actors Role
ES
Investment
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EX
Exercise II: Group Actors
ER E IS C
Other Stakeholders
Core Value Proposition
Complementary Offerings
0 5 MI :0 NU 0 T Supplying and Enabling Network
ES
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EX
Exercise III: Define Value Flows
ER E IS C
Goods & Services
Goods & Services
Money & Credits
Money & Credits
Information
Information
Intangible Value
Intangible Value
1 5 MI :0 NU 0 T ES
Outlook
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Value Flow Mapping / Value Network Modeling in the Design Process Abstract: Modeled World PRINCIPLES
5
6 PLANS
2
3
OBSERVATIONS
Analysis (Think)
Synthesis (Make)
7
1 4
TESTS
Concrete: Real World
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Q&A /// Feedback
A TH B I A G TO NK
AL Y TE L » OU ST BE ER TA S«
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Attributions “Gears” symbol by Dima Yagnyuk // "Type Desgin" symbol by Andrew J. Young // “Compass” symbol by Adam Whitcroft // “Refresh” symbol by Joris Hoogendoorn // “Pointer” symbol by ___Lo // “Speaker” symbol by Harold Kim // “Book” symbol by Ahmed Hamzawy // “Unlock” symbol by Ugur Akdemir // “Heart” symbol by John Caserta // “Like” symbol by Marwa Boukarim // “Letter” symbol by John Caserta // “Lock” symbol by Dave Tappy // “Cess” symbol by Alessandro Suraci // “Social Services” by Jack Biesek, Gladys Brenner, Margaret Faye, Healther Merrifield, Kate Keating, Wendy Olmstead, Todd Pierce, Jamie Cowgill, Jim Bolek // “Building” symbol by Antonis Makriyannis // “Brain” symbol by Arjun Adamson // “Building Block” symbol by Michael Rowe // “City” by inna belenkey // “Basket” symbol by Roman J. Sokolov // “Unlock” symbol by Ugur Akdemir // “Hand” symbol by Jakob Vogel as well as "Home" and "Umbrella" from The Noun Project collection. -----------------------------------------------------------------------------------------------------------------------------------------------------------Some References this Workshop/Presentation was based on: Adner, R. Amazon vs. Apple: Competing Ecosystem Strategies. Harvard Business Review. Retrieved August 11, 2013, from http://blogs.hbr.org/cs/2012/03/amazon_vs_apple_competing_ecos.html. Brandenburger, A., & Nalebu!, B. (1996). Co-Opetition. New York: Doubleday. Caulfield, B. Apple’s Ecosystem. Forbes. Retrieved August 11, 2013, from http://www.forbes.com/2010/02/09/intel-nvidia-htc-technology-business-intelligence-apple.html. Dachis, J. Apple, a Love Note: The Power of an Ecosystem - Dachis Group. Dachis Group. Retrieved August 11, 2013, from http://dachisgroup.com/2010/01/apple-a-love-note-the-power-of-an-ecosystem/. McCann, J. It’s The Ecosystem, Stupid. subPrint Interactive. Blog, . Retrieved August 11, 2013, from http://subprint.com. Moore, J. F. (1997). The Death of Competition: Leadership and Strategy in the Age of Business Ecosystems. New York: HarperBusiness. Moore, J. F. (2013). Shared Purpose: A thousand Business Ecosystems, a connected Community, and the Future. Ng, I. C. (2012). Value & Worth: Creating New Markets in the Digital Economy. Ng, I. C. L., & Smith, L. A. (2012). An Integrative Framework of Value. Review of Marketing Research, 9, 207–243. Ouden, E. den. (2011). Innovation Design: Creating Value for People, Organizations and Society (1st Edition.). Springer London. Senge, P. M. (2006). The Fifth Discipline: The Art and Practice of the Learning Organization. New York: Doubleday/Currency. and many more …
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About me … I am a Berlin-based innovation facilitator who helps organizations in strategically implementing service design, business model innovation and (branded) Ux methodologies, processes and tools.
Besides my advisory practice I am a »HPDTRP« research fellow at the Hasso-Plattner-Institute Potsdam, examining Design Thinkings level of diffusion in organizations worldwide.
My work is mainly based on the discovery of shared value which I researched at Berlin University of Arts and Zeppelin University Friedrichshafen.
I’m also co-developing GlobalWasteIdeas.org, an ideasharing and collective intelligence platform dedicated to catalyze innovative ways to deal with waste. @Jan_Schmiedgen 37
Design-driven strategic business planning Jan Schmiedgen // Fidicinstr. 41 // 10965 Berlin // GERMANY // +49 173 3 83 15 26 // kontakt@schmiedgen.eu
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