Business experiment
Process tool
Nils Erkamp – M +31651881549
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Why we do business experiments
• New value innovations starts through (local)
cooperation of stakeholders (supply <> demand)
• Scale-up on European scale – other parties and
countries can learn
– Product / service improvement
– Better, faster process
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Idea generation
• A collaborative business project starts with 3
things come together:
– An opportunity in the market to create value
– An idea on how to deliver that value
– And people that are willing to commit time and money
to realize the idea and harvest the opportunity
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A collaborative process
• Bringing the people together to realise the idea
follows a number of logical steps, designed to get
things done as effective as possible
• New business creation seldom goes as planned:
– Learn, be flexible to adjust the plan, problems are often
a blessing in disguise that demand a better solution
– Each partner has its own interest and at some moment
in time you need to come to an agreement that is winwin
– You may need a few iterations before getting there
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High rewards
• It’s not easy and initially slower than when you do
things on your own
• That changes when partners use each parties
competences in the best way
• But, if you succeed …
– You create a business that would never have been
possible without collaboration (1 + 1 > 2)
– You create a business that is hard to copy
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The templates
• The following slides first describe the high-level
process
• Then for each step templates are available with
the key questions that need to be answered
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Business experiment process
• Process steps
Analysis of
WP2 and WP3
Brainstorm at
clusters
WS1: define
product &
value
Ideas
Product,
service, value
and value chain
WS2: business
model
WS3: financial
model
• Results
Opportunities
6
Business model
Financial
model;
commitment to
project plan
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PROJECT
Tools
• Process steps
Analysis of
WP2 and WP3
Brainstorm at
clusters
WS1: define
product &
value
WS2: business
model
WS3: financial
model
PROJECT
• Tools (topics see next slide)
T1
7
T2
T3-6
T7-9
T10-11
TK2,4,5
TK5,6,7
TK1,2,4,7
TK4,8,9
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TK3,10
Open innovation toolkit
1. Relationships and cohesion
2. Open communication and dialogues
3. Commitment
4. Trust and safety
5. Climate for innovation and creativity
6. Clear strategy and goals for collaboration
7. Selection of relevant and appropriate partners
8. Structure and governance for collaboration
9. Contractual arrangements
10. Evaluation of process and results
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Contracts – a point of attention
• Contracts, like a Non-Disclosure Agreement, have pro’s and
con’s
– More certainty on commitment: people with the right authority
need to sign so it can not be an individual employees
enthusiasm, but the organization needs to buy in
– Although it is very difficult to exercise the rights legally,
peer/social pressure (esp. in a multi-party agreement) can work
well
– Legal processes can cost a lot of time/energy; it can change the
atmosphere from co-operation to adversaries. Always use
mutual agreements (same rules apply to all) to avoid this
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Part 1
• Shaping the idea
Opportunities
10
Ideas
Product,
service, value
and value chain
Business model
Financial
model;
commitment to
project plan
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Template 1: OPPORTUNITIES
Idea name
Describe the
opportunity ?
How will it bring
value ?
Where would it be
applied ?
What’s the
alternative today ?
11
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Template 2: BUSINESS IDEA
Idea name
What is the product /
service ?
Who is the customer /
buyer ?
What is the value to this
customer / buyer ?
Which value chain
parties are interested (+
indicate business scope)
12
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Template 3: Customer description
4
3
2
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1
Template 4: Product, service and value
3
2
1
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Template 5: ENRICHED IDEA
Idea name
Describe the product or (+ add features in template 5)
service
What is the value
(+ add main points in template 5)
proposition ?
What is a customer
willing to pay ?
What is the market &
In quantities and value
segment size ?
What are competitors or
alternatives ?
15
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Template 6: value chain – market description
1) Specification &
sales process
2) Production,
physical
distribution,
installation phase
3) Operational &
usage phase
P1
P2
P3
Customer
P1
P2
P3
Customer
P1
P2
Customer
User
Complementing
products & services
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Part 2
• Business model: a description how we are going to
achieve our goals
– Revenues
– What competencies are needed; who does what
– Costs and investments
Opportunities
17
Ideas
Product,
service, value
and value chain
Business model
Financial
model;
commitment to
project plan
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Template 7: Business Model Canvas
4
2
6
5
3
7
1
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Template 8: BM consortium conclusions
Type
What core competence
do we not have in the
team ?
Complementary partners
Potential
partner
IN consortium
OUTSIDE consortium
(includes current consortium partners
that do not have a crucial role)
Are there tasks that more
than 1 party can do ?
19
Decide who does
what asap !
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Template 9: Project leadership
Idea name
Who is in the team ?
Who takes the lead ?
What are the open
questions ?
What are the key risks ?
Next actions
20
e.g.
-Each partner to agree results within his
own organization
-Answer open questions
-Address key risks
-Get right partners to join
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Part 3: Financials & next steps
• Financials: how is money going to be invested,
spend and earned. How will risks and rewards be
shared ?
– Prepare open book estimation by all partners
– Bring together and discuss
– Agree on joint approach
Opportunities
21
Ideas
Product,
service, value
and value chain
Business model
Financial
model;
commitment to
project plan
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Template 10: Financial discussion
• Each partner prepares partner finances
• The consortium discusses and agrees on project
22
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Sanity check
• Customer perspective: is it also for the buyer a
good deal ?
– Cost of ownership
– Value of ownership
• So far by means of a
subjective value bonus
23
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Cost-of-ownership
Collect inputs on each of the parameters below on the new proposition and on the existing alternative.
Then calculate through with the TCO model
Parameters
Result
Installation design
Number of
units
Installation cost Unit price
Investment
Energy
Burning hours
kWh price
Average power Power consumption
/ unit
Energy/CO2 cost
Maintenance
Replacement
cycle
Cleaning /
checking cycle
End-of-life
time
Value creation
Re-usage value
Societal value
(% or €)
Maintenance cost
To be prepared by the partner who is in closest contact with the end customers
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Template 11: NEXT STEPS
Topic
Check agreements with
home organization
Consortium and other
contractual agreements
Create steering team
Who
Agree project team and
project manager
Assemble team and plan
project kick-off meeting
Steering team
25
Each partner
Project manager
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