Friday, February 11, 2011

How to create new business models?

What is common between car design and the creation of a business? Not much unfortunately, sorry Alexander Osterwalder, a consultant specializing in business models of innovation. However, the design of automobiles is structured by a series of steps that would greatly benefit the design structure of a company, says the author of Generation Business Models at the conference Lift11 who was in Geneva.

"Now, how is launching a new business? Imagine Mike to a new idea. He masters the tools business, is market research, builds its business plan and once he did that, he will find money, find investors and, if found, is embarking on building his business. It's beautiful! But in most cases, "business models do not survive first contact with consumers," recalls Steve Blank, a renowned serial entrepreneur in Silicon Valley.

Why then do you build business plans that will collapse against the reality of the market? Why do we see so many costly failures? "We must learn from the design of automobiles, said the consultant in his presentation. In car design, we begin by making many drawings (sketching) before building prototypes to understand how materials work together, how can they be together ...

It makes the simulation. We make crash tests. We modify the design before building. We rolled the car prototype on real roads to assess their behavior and adjust the settings ... "How many of you have tested your business in real life before the start? Can we formulate business models in a similar way to car design? We know what a car? But what is a business model? "Interrogates Osterwalder.

"Describe your business model in 30 seconds with your neighbor!" He quips in a challenge to the room, leaving it flapping loudly for 30 seconds. Can we invent a language to describe and design business models? This is what in any case the consultant's method built around a "web business model" composed of "9 molecules", 9 Lego that fit into each other and need to answer many questions.

Who are the consumers that our product addresses? What is the value proposition? How do you reach customers? What kind of relationship do I have established with these consumers? How will people spend money? How to get to these sources of income? What are my key activities? What are my partners? What are the costs of my structure? All values he considers necessary to describe a business model in a more tangible.

It is a telling example, which is on the same model that describes some of those very Dominique Nora, in Pioneers of Green Gold. The founder of SunEdison, Jigar Shah, and found that people did not buy solar panels, because they felt it was too expensive. So, Sun Edison has decided to change that by supporting the installation price in exchange for the purchase of energy for 10 years.

In recent years, Sun Edison became the largest producer of solar energy in the U.S. and is growing in Tech News Buzz whole - even if Sun Edison is now rivaled by many other companies who took the same model SolarCity business as such. We see here the proposal was to modify the prototype of the offer: its business model itself.

"To find new business systems, we must develop fully," said Osterwalder. We can make prototypes of different economic models. And ask questions: What happens if my product is free for example? Each technology may have several different economic models, we must study them all to go further.

Osterwalder evokes the Swedish Peepoo Bag, a biodegradable bag converting human faeces for fertilizer and who wants a solution to the land-disposal systems sewage. The product is incredible, says Osterwalder, but he needs a business model for it is implemented. And it is for now still the problem with this company.

But the advantage, especially for companies whose products are digital, we can simulate it and try to assess how much more accurate business models. Osterwalder and set an example of one of its customers RunKeeper, an application that has played in its economic model to understand its scope.

The team has worked RunKeeper to estimate the number of users and their earnings if they offer their products for free, for a fee, by developing a professional offer to see a low monthly fee coupled with fitness classes ... The idea is to play with the data to see how you can win by changing the entries of the economic model.

Still, it should still end up testing business models, even after doing simulations, emphasizes the consultant. Because it is often where they are mistaken. Assumed average purchase ... On paper it looks great. But "we must leave the building and talk with consumers." "Except that on the internet, it's easy to do.

One measure of interest in a product that is not ready by adding a button that points to a service not yet exist ... "" Let us, "concludes a very clear and educational consultant:" The Contractor must have a systematic approach. We must learn to play, take risks with the alternatives and then test the assumptions to see what can really work.

"With these tips, you can certainly miss more your business model. THE IMPORTANT IS THE RESULT? Dorian Selz Swiss is a serial entrepreneur who has launched some years ago Local. hp engine and directory of local search Switzerland, which has launched a new startup called Memonic, a note-taking application online.

Conversely Alexander Osterwalder, trying to put the method into the workings of organizations, Dorian Selz in his presentation (. Pdf) takes opposite view and said that the rational interest is not always the primary factor new forms of organization and cooperation. Dorian Selz, a contractor must forget the complexity ("a business model should not be longer than one A4 page?) Partners must understand and understand him as well as its objectives.

It must also drop the desire to control everything and rely on its users and its staff. The company today has forgotten the single system: the white elephant, and instead promote the separation into independent units of its teams, processes, methods, tech, so that if a piece of chain falls, it does is not serious for the whole.

Dorian Selz also invited to drop the project management: we must reduce the number of managers and reduce management that now cost far too expensive for most businesses. The contractor, proud to break the conventional wisdom, invites the audience to challenge the processes and methods in place, often too fussy: you have certainly set goals, but also learn to observe them, says he boasting agile development methods and guided by the manifesto for agile software development.

Dorian Selz and explain the role of a boss is that employees will facilitate his task, but it facilitates their work. In virtual organizations, physical presence is no longer mandatory, the meetings either. Memonic is a team of 9 people who come from around the world and who really needs to be able to join permanently as to organize strategy meetings incessant.

Moreover, rather than having to spend his time solving political problems within a company, Dorian Selz sales discussions to solve problems. Forget supply management: suppliers must become partners need to better inform and engage with your company policy ... These tips that Dorian Selz presents as the essence of modern management are certainly not applicable to all forms of enterprise, far away.

All organizations are not connected together without constraints. The manager seems mostly to settle accounts with the traditional management seeded symptoms are real, its inefficiencies and its abuses. "Only the result counts," concludes Dorian Selz. Not sure if this is enough to make strategy.

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