Business Orientated Solutions in
enforcement
Business Orientated Solutions in
Jos Uitdehaag
enforcement
Business Model
A business model
describes the rationale
of how an
organisation creates,
delivers and captures
value.
Business Model:
“Every organisation, whether a business
or not, has a theory of the business.
Indeed, a valid theory that is clear,
consistent, and focused is extraordinarily
powerful”.
Peter Drucker, Harvard Business Review, Sept-Oct, 1994 –
‘The Theory of the Business’, p. 96. [italics added]
Business Model
In other words: in theory there is no difference whether we are
talking about a private business orientated or a state based
organization
And in practice????
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The business model is like a blueprint for a strategy to be implemented
through organizational structures, processes, and systems
A business model can best be described through nine basic building blocks
that show the logic of how a company intends to make money.
The nine blocks cover the four main areas of a business:
customers, offer, infrastructure, and financial viability
The Building
The building
blocks Blocks
Customer
Segments
An organization
serves one or
several Customer
Segments.
Value
Propositions
Channels
Customer
Relationships
It seeks to solve
Customer problems
and satisfy
customer needs with
value propositions.
Value propositions
are delivered to
Customers through
communication,
distribution, and sales
Channels.
Customer relationships
are established and
maintained with each
Customer Segment.
The building blocks
Revenue streams
Revenue streams
result
from value
propositions
successfully
offered
to customers.
Key resources
Key resources are the
assets required to
offer and deliver the
previously
described elements…
Channels
Key
partnerships
Cost structure
…by performing
a number
of Key
Activities.
Some activities are
outsourced and
some
resources are
acquired
outside the
enterprise.
The business model
elements result in
the
cost structure.
The Building Blocks – Customer Segments
Customer Segments
mass market
- niche market
- segmented
- diversified
- multi-sided platforms
-
The Customer Segments Building Block defines the different groups of people or organizations
an enterprise aims to reach and serve
The Building Blocks – Value Propositions
Value Proposition
Customer Segments
newness: IT use
- performance
- customisation
- getting the job done
- design
- brand/ status
- price
- cost reduction
- risk reduction
- accessibility
- convenience/ usability
-
The Value Propositions Building Block describes the bundle of products and services that
create value for a specific Customer Segment
The Building Blocks – Channels
Value Proposition
Customer Segments
- own
- partner
- direct
- indirect
Channels
The Channels Building Block describes how a company communicates with and reaches its
Customer Segments to deliver a Value Proposition
The Building Blocks – Customer Relationships
Value Proposition
Customer Segments
Customer Relationships
- personal assistance
- dedicated personal
assistance
- self-service
- automated services
- communities
- co-creation
Channels
The Customer Relationships Building Block describes the types of relationships a company
establishes with specific Customer Segments
The Building Blocks – Revenue Streams
Value Proposition
Customer Segments
Customer Relationships
- asset sale
- usage fee
- subscription fees
- lending/ renting/ leasing
- licensing
- brokerage fees
- advertising
Revenue Streams
Channels
The Revenue Streams Building Block represents the cash a company generates from each
Customer Segment (costs must be subtracted from revenues to create earnings)
The Building Blocks – Key Resources
Value Proposition
Customer Segments
Customer Relationships
- physical
- intellectual
- human
- financial
Key Resources
Revenue Streams
Channels
The Key Resources Building Block describes the most important assets required to make a
business model work
The Building Blocks – Key Activities
Value Proposition
Customer Segments
Customer Relationships
Key Activities
- production
- problem solving
- platform/ network
Key Resources
Revenue Streams
Channels
The Key Activities Building Block describes the most important things a company must do to
make its business model work
The Building Blocks – Key Partnerships
- optimisation/
economy of scale
- reduction of risk
& uncertainty
- acquisition of
resources and
activities
Value Proposition
Customer Segments
Customer Relationships
Key Activities
Key Resources
Key Partnerships
Revenue Streams
Channels
The Key Partnerships Building Block describes the network of suppliers and partners that make
the business model work
The Building Blocks – Cost Structure
- cost-driven
- value-driven
- fixed costs
- variable costs
- economies of
scale
- economies of
scope
Key Partnerships
Customer Segments
Value Proposition
Customer Relationships
Key Activities
Key Resources
Cost Structure
Revenue Streams
Channels
The Cost Structure describes all costs incurred to operate a business model
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The Business Model Canvas - Example
KP
KA
Customers who
build new LEGO
designs and post
them online
become key
partners generating
content and value
LEGO has to
provide and
manage the
platform/ logistics
that allow
packaging/ delivery
of customer made
sets
KR
LEGO has not yet
fully adapted its
resources and
activities, which are
optimised primarily
for the mass market
C$
The Factory leverages production
and logistics costs already incurred
by its traditional retail mode
VP
CR
LEGO Factory
substantially
expands the scope
of the off-the-shelf
kit offering by giving
LEGO fans the tools
to build, showcase,
and sell their own
custom designed
kits
CS
LEGO Factory
builds a Long Tail
community around
customers who are
truly interested in
niche content and
want to go beyond
off-the-shelf kits
CH
LEGO Factory’s
existence depends
heavily on the Web
channel
R$
Thousands of new,
customer designed
kits perfectly
complement LEGO’s
standard sets of
blocks. LEGO
Factory connects
customers who
create customised
designs with other
customers, thus
becoming a
customer matchmaking platform and
increasing sales
LEGO Factory aims to generate
small revenues from a large number
of customer designed items. This
represents a valuable addition to
traditional high-volume retail
revenues.
Alexander Osterwalder