Documenting and Developing Business Models

The “Business Model Generation” methodology is an essential aid to all business owners and consultants, who want to  document, communicate and brainstorm businesses models in a succinct manner.

The book “Business Model Generation” by Alexander Osterwalder & Yvess Pigneur provides great examples of how to document business models, along with methods to brainstorm innovative changes in business models for existing businesses.

If you like visual aids, then you are going to love the techniques described in this must have book. What struck me, biased as I am toward visual tools, is how their visual models encapsulate the linkage and dependency on the key elements of the business in one page.

The base technique describes uses a common base canvas to capture the core building blocks of your business model: Key Partners (FP), Key Activities (KA), Key Resources (KR), Value Proposition (VP), Customer Relationships (CR), Channels (CH), Customer Segments (CS), Cost Structures (CS)  and Revenue Streams (RS).

A simple example of how this would work for apple’s I-pod is shown below:

Once the base or existing model is created the book then helps you explore the opportunities to explore other alternative business models. Some example business models described in the book include:

  • Unbundling Business Models
  • The long tail
  • Multi sided platforms
  • FREE as business model
  • Open Business Models

Key techniques described include brainstorming with the use of post-it notes against the base canvas, as well as my old chest nut of customer value propositions and what’s in it for customers.

Once you have your model developed with post it notes, you can really go to town and prepare a visual form of your business with pictures.

BTW: Do not be put off by the 72 page book preview available on their web site http://www.businessmodelgeneration.com/.  As a result of my pre-read of the preview I nearly didn’t buy the book. So glad I did purchase, based on a recommendation (thanks Matt McKendry).  My order on amazon was delayed waiting for a reprint, so hopefully they now have plenty in stock.

This book is now going on my must read list for entrepreneurs, order your own copy now

Post Ed note: I now run workshops which include this methdology – www.growthmanagement.co.nz/training

After using this model for some time I have come up with my own variant read more>

One-Two or No Online Personalities – Social Media in Business

One of the big decisions in entering the Social Media space is to work out how many personalities you have? Do you mix work and business  together in one personality or presence? Do you keep Facebook for personal and LinkedIn for work? Or do you just say I am private and I want no online presence.

Google your name, what comes up? – porn star, sports results or a successful business person? You have some control over this; do not leave it to chance.

No matter what decision you make, you need to manage your online brand and impression. This goes for everyone young and old. Remember we live in a new world “what goes on tour stays on  youtube, flicker, facebook”. This is particularly relevant for younger people who may have some skeletons that they may not want surfacing when they are about to go for that big job, close that contract or whatever.  A good rule to follow is put nothing on the internet that you wouldn’t want your mum to see or appear on the front page of the Herald.

For those who say no online presence, you have no say, stuff will appear and it may not be what you want.   Many people in this camp simply do not want to be on show. The absence of an online presence, for some, may be interpreted as “you have something to hide”.

If you are business and hold a customer facing position I strongly  suggest you need build an online presence. At very least put a brief LinkedIin profile up (www.linkedin.com). This will always appear high on the google search. Alos mor and more people are using linkedin as a qualifying tool for people they want to do business with.

ONE or TWO Personalities?

Many people are subscribing to the two or schizophrenic personality approach, one for work stuff one for personal. At the moment I am using one for business (Blogs, Linkedin, Work Related Facebook pages) and another for my personal  Facebook. With my personal facebook only open to my real friends and close acquaintances.  After hearing some Social Media experts in Sydney last week I am starting to question this.

One Online Persona – Camp

@MartyatDell and @RichardatDell subscribed to the one persona camp. Their logic being – Dell is about dealing with real people, that have life’s outside work. “If I speak about Dell products I should declare it” – hence Dell employees are encouraged to have one twitter account, note they include “AtDell” in their name so it’s clear and transparent that they are Dell employees .

It’s clear that if you are empowering your employees to be spokespeople for your business you need to ensure they are communicating in a manner compatible to your businesses brand.

I subscribe to the theory that says you must actively manage your personal brand on and off line. Companies brand identities are in part, made up of the mini brands of their employees.

So if you are going to use one persona – some tips:

  • Keep your postings balanced 80% work- 20% personal
  • Do not bombard (spam your audience) – I followed “Guy Kawaski” on twitter for about 2 days because of this – shame he is a great thought leader.
  • Remember social media is about attitude and opinion, but don’t overdo it.

 Split Personality Work and Home

At the moment the approach of splitting work and home seems to win favour with most, avoiding spamming your business contacts with what a great dinner you are at or your recent bike ride.

As search methodologies evolve this may become a moot point.  Clearly the trend and in fact one of the benefits of Social Media, is that when you search the web you will get material based on your interests and from people who you trust. If you want highly relevant information fed to you, then perhaps the single persona is the approach.

And remember at the end of the day, there is only one of you – like it or lump it.
When you get me,you get all of me, but perhaps that only suits the extraverts out there.

What’s your approach and why?

How Can Social Media Help My Business?

I am on the hunt for ideas on how we can use this new gateway (Social Media) to our customers.

Once you get Social Media is all about engaging your customers and fostering your brand, the next question is how can you use it in your business?  Here are some ideas:

Listening: the first step in the Social Media world is to look and listen to what people are saying about you and your business. Likewise; what is going on in your competitor’s world?

Crowdsourcing: finding and attracting customers and brand enthusiasts.

To date it seems most start with encouraging participation with discounts and offers. Check out “Dell Outlet” where they shift end of line products, I heard a rumour that “Dell Outlet” is coming to the Australia – New Zealand market. Air New Zealand is experimenting with “air points fairy” and “four square koru”.

Crowdsourcing – attracting customers is the most common desire from SME’s. Don’t forget that this world is about community and involvement rather than just push – broadcast marketing.

Market intelligence: Product design and review

Engage your customers in your product design prioritisation or concept filtering. Dell has used this extensively with “idea storm”. For start-ups and emerging companies this is an ideal way to keep your early adopters in the loop.
Telstra have used social media to get customers to review new products. In a recent handset launch they were swarmed with people wanting to review their new handset. The good news is the customer reviews, good and bad, come across more credible than traditional journalist review.

Thought Leadership: Being the conduit of information, Blogs are a good place for this, weather you create your own or participate in market influencers Blogs. This is a great option if you have a small customer set that you want to safe harbour i.e keep them loyal to you. Engage them in discussion about your area of speciality.

Advertising: Facebook provides an opportunity to do some targeted demographic and interest based advertising. SaleFinder have used it to attract new subscribers to their web based business.
Breaking information silos:For larger companies – organisations particularly government funded organisations, that are extremely risk adverse it may at the first step an opportunity to simply engage with staff, perhaps internal only to start with. Breaking down silos of information internally may be an interim win. I personally would love to see government departments engaging with their stakeholders (their tax payer clients) and beginning dialogues.

Follower’s vs Activists: Don’t confuse numbers’s with quality conversations. Engaged dialogue with a small number of clients may be better than thousands of dumb followers.

Andy Lark recently made a blog post to this effect: CONVERTING FOLLOWERS TO ACTIVISTS
http://thedailylark.com/required-reading/converting-followers-to-activists/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+TheDailyLark+%28The+Daily+Lark%29
One last word of caution, remember Social Media is a dialogue not broadcast, and be clear on how it fits within your strategy.

I would love to hear how you are using or planning on using Social Media in your business.

#SocialMediaBusiness

Not Convinced That Social Media Is Right For Your Business?

Social Media is all the talk, many business owners still have their heads in the sand and still think it’s just Facebook, Twitter..blah, blah. Nothing to do with real business.

If you’re a business owner or marketing manager, then add Erik Qualman’s book, Socialnomics, to your must read list before it’s too late.

My take after exploring this new phenomena , Social Media in business,  is it’s a new way of leading and managing a company, a new culture of total customer engagement that will guarantee success.

Warning: this is not about setting up a Facebook page … see my other blog posts to come…

Social Media is so disruptive, that Socialnomics author Erik Qualman states it simply as: The ROI of social media is that your business will still exist in 5 years”

If you’re still stuck in denial (and you are not alone) – a non-believer in social media, then do yourself a favour: view the two great Socialnomics.com  YouTube clips – Media Revolution 2 (Refresh) 4min:26sec  and Social Media ROI 4min:15sec.  (see below), then go buy their book. www.socialnomics.com 

“I found the book a great and easy read. One hotel night and a flight back from Sydney, had this inspirational  book read.We are entering a new world and way of doing business, this is not about applying old business models to new tools its a new way of thinking.At its heart is a philosophy and culture that embraces customer feedback in this instantaneous world. Done properly = instant market intelligence”

 It was so good I have added it to my must read business book list.

Here are a few of the many facts –opinions that Socialnomics promote:  

Epidemic adoption rates: Years to Reach 50 million users:  Radio (38 Years), TV (13 Years), Internet (4 Years), iPod (3 Years)…Facebook added over 200 million users in less than a year,

Power of endorsement:  78% of consumers trust peer recommendations. Only 14% trust advertisements. Only 18% of traditional TV campaigns generate a positive ROI

25% of search results for the World’s Top 20 largest brands are links to user-generated content, 34% of bloggers post opinions about products & brands, Do you like what they are saying about your brand? You better!

To get the full list of facts mentioned in the video clips g to the Socialnomics site links below:
http://socialnomics.net/2010/05/05/social-media-revolution-2-refresh/
http://socialnomics.net/2009/11/12/social-media-roi-examples-video/

So is this applicable to your business ? –  Yes .
Of course we care about what people say about our brand or people. So how do we participate then, because it appears that we do not have a choice?

@MRobotham #socialmedia

Business Strategy and Brand Values First in Social Media Projects

New Breed of Business Strategists for Social Media

 Social Media has many businesses taking a fresh look at their online strategy. This new business approach is so new, that most experts themselves are making the rules as they go.

When it comes to social media make sure you engage professionals who tackle this task from a business strategy perspective first,  rather than jumping into creating web or Facebook pages and the like.  There is a small sector of business strategists who are focused on business strategy and outcome over technology when it comes to the online channel.

Leading the pack in this new breed of strategists are Experience Networks  Ltd,  they are specialists in web strategy— joining the dots between customer satisfaction, business success, creative desire and technical reality.  

When I asked some of the Experience team for some advice for those looking at Social Media for business , Miriame Barbarich and Olly Barrett  had the following advice for business owners :

Where to start? Without guidance it can be difficult to know where to apply early efforts. Initially our message is always to ‘Listen’ before contemplating doing any social media activity. We’ll identify a few tools and places to look in order to find out what people are already saying about an organisation or initiative. This is sometimes a revelation to them.

Why start? We’ve experienced a top down pressure within organisations to ‘do social media’ without a real understanding of whether it would make sense for that organisation. Is it realistic to expect people to ‘Like’ or follow a government department when they see it as another channel for press releases? Thinking creatively and with relevancy and sustainability is important.

Resource management Social media can require the establishment of a cross-functional team with a broader remit than classic communications or advertising. Creating, managing and inspiring this team can take time and effort. Resourcing out of office hours can sometimes be a challenge.

 Internal empowerment concerns can exist with letting go of some element of control and approval loops to permit employees to directly commence and contribute to the conversation.

Policy conflicts specific to government, considerations surround the need to comply with the Privacy Act 2005 for auditing and identifying exactly who within an organisation is able to sign an organisation up to a social media account and effectively bind the Crown. Important when thinking about where and how NZ citizen data may be stored. This has lessened slightly with recently changes in policy.

Letting the conversation happen this is the biggest issue for organisations and government departments in terms of creating an official space within which they have less control over what is being said about them, both positive and negative. Equally, it is important to realise it will happen anyway whether you’re involved or not so providing another viewpoint to the conversation can be necessary.

Objectives for the likes of Telecom and other large corporations the desire can be to build longer term relationships and create a sense of ‘from the horse’s mouth’. Slightly different for government departments which work on shorter term campaigns and have mass communication objectives. In these cases it may be necessary to focus on the place social media can have in increasing engagement instead of extending reach.

A good time to review your Business Culture, values and purpose!

From my perspective I would recommend reviewing your core business strategy and culture in light of these new tools.

This is a time to be absolutely clear about your work culture and brand values. Check your business and marketing strategy
In particular I would recommend  the following approach:

  1. Ensure that you have clarity and purpose for you company at a strategic level about your business culture and value you give your customers.
  2. Dip your toe in the water and listen and observe what is being said about you and your brand.  It’s like going to a dinner party with new friends, observe first then participate in conversation.
  3. Decide how at a strategic level this new form of engagement can add value for your company and identify some potential projects and who from your company (hopefully everybody) will participate. Engage some professional help.
  4. Train and socialise internally you Brand personality – like Telstra’s 3 R policy. How open and who is going to be able to speak on behalf of your company.
  5. Only then consider what project(s) you should undertake, and get in the techno –web2 teams and subcontractors.
  6. Test and be ready to fail and adapt fast.

Oh and of course get some help from the likes of the Experience Team www.experience.net.nz

Point of disclosure – GrowthManagementConsulting are advisors to *Experience

@MRobotham #socialmedia

Social Media a New Management Philosophy – Not Facebook

Are you ready to adopt the new way to do business?
Or are you like most running scared of Social Media ?

The Social Media  phenomena must be one of the most miss-represented and miss-understood business tools – methodologies today.

It is so disruptive that a author Erik Qualman –Socialnomics states it simply as: The ROI of social media is that your business will still exist in 5 years”

Consistently companies large and small fail from lack of clarityand engagement with their market and inability to maximise the performance from their loyal staff.

The paradigm shift is that Social Media, in a business context, to be successful is about a new way of doing business and engaging customers, not technology. This change must start at the top of organisations with new leadership styles, clarity of purpose, and most importantly empowerment and ownership of this by the staff. 

Once you embrace the true Social Media culture your organisation is open to all the benefits of full customer engagement (market intelligence), but equally so you will live in a glass house, open to view 24 hrs a day 365 days a year.

Just as individuals consistently rate public speaking as their top rated fear, NZ Businesses appear to be running from open an uncontrolled engagement with their customers and loyal brand ambassadors. 

Embraced properly this new approach engages market feedback in seconds – real time, not with 3 months delay as you commission a new market survey.

There are a few thought leaders who have embarked on this new leadership and business approach, its early days but I will predict those that get this right will eat their competitor’s lunch.

Dell an early adopter, who have been on this journey since 2006, are pioneers in this space.  Some examples of early success are: “Dell Swarm programme”– join the Social Media group and as the group grows you get a bigger purchasing discount; “Dell Outlet” clears $2M+ end of line product with special offers.

Unfortunately to-date, too many people, internal champions, are selling it as Facebook and Twitter, a technology play, or worst still just implementing Social Media without the change in management approach which more than likely will result in failure.

 This is the first blog post in a series on Social Media …
look out for my upcoming report on Dell’s Social Media forum held last week in Sydney

@MRobotham #socialmedia