Benefits of Using Osterwalder Canvas Business Model
As a business owner, you know that prior planning will help prevent failure. However with so many business books and so-called gurus saturating the business advice market, it can be difficult to decide which framework will best help you succeed. This is where global thought leader, Alexander Osterwalder canvas comes in. His business model canvas is used by millions because it provides a sound model which businesses of all sizes or industries can benefit from.
Osterwalder’s business model benefits
Canvas gives you the ability to quickly describe and comprehend your business model. With this knowledge you can gain understanding of the direction of your business and assist in the prioritisation of day-to-day, weekly and monthly tasks.
Highlights your uniqueness
While there are many different business conceptualizations, Osterwalder canvas will help you to articulate your unique value proposition in one glance. By knowing your value proposition you should be able to make the connection between your customer’s needs and your product. If any failures in this connection become apparent then you can begin to tweak your business model to improve profitability.
In addition to the beginning stages of a start-up, this model can be used to visually represent an established company. Osterwalder canvas don’t need to be static you can easily change it, as your business matures.
The practical tool can help facilitate dialogue between groups in your business and therefore encourage in-depth examination and innovation. For collaborative use, you can copy out the framework onto a big white board and get key employees to discuss and contribute using pen markers or sticky notes. In addition, you can use a web platform such as Canvanizer.com or Strategyzer.com.
Osterwalder canvas explained
There are 9 elements within your business that you need to analyse to effectively utilise canvas:
1) Customer segments: identify which customer you are targeting with your product or service.
2) Value Proposition: Your business’s value proposition is the product or service offered by your business that meets the need of your customer. It will help to distinguish yourself from the competition according to Osterwalder (2004).
3) Key activities: the activities that are crucial to delivering your business’s value proposition.
4) Key resources: the assets’ your business needs to action your key activities.
5) Partner network: operation optimisation can be achieved through good supplier relationships or strategic alliances.
6) Channels: method(s) used to reach your target customer. Effective channels are quick and profitable. Your own channel would be a website or store and partner channels include department stores.
7) Customers relationships: depending on each customer segment you should decide the appropriate relationship that should be established between the business and customer.
8) Cost structure: significant costs and identification of costly resources or activities.
9) Revenue streams: income generated from customers in the identified segments
Without a critical understanding of your present circumstances, your business will not be optimised for growth. However, using Osterwalder’s canvas will allow you to conceptualise your business model and consequently prepare you for a successful future.