Business Model Canvas

Business Model Canvas

A business model canvas lays out the objectives and goals of the business. Business leaders use the model as a management tool to evaluate or create new business models based on market performance. A business model canvas comprises nine elements, each with varying significance for businesses.

The Most Important Elements of the Business Model Canvas

The Value Proposition

According to Wormald (2013), value proposition refers to a service, innovation, or product feature the business intends to offer consumers. A business undertakes a customer survey to realize a value proposition. Afterward, the business addresses these pain points. Businesses that focus on offering top-notch value propositions keep innovating and developing new products or improving current offers.

Customer Relations

Building solid customer relations is another valuable component of the business model canvas. Solid customer relationships are key to retaining key customers and transforming potential customers into real customers (Ylinen, 2014). A business supports positive customer relations by providing customer services and responding to customers’ feedback.

Partnerships

Another crucial activity is to establish reliable partnerships. Most businesses seek to create long-term relationships since that allows them to focus on other important business activities (Lostakova & Pecinova, 2014). For instance, having reliable and trustworthy suppliers means the business will not need to worry about shortage issues.

A Real-World Example

The Macintosh TV is a notable product failure resulting from the failure to execute the business model canvas elements. Apple launched the product hoping to help customers use a single device for multiple functions. However, the device failed because one had to switch between the computer and TV back and forth (Huddleston, 2018). Customers had hoped for a device that would be used to perform both television and computer functions simultaneously, but Apple failed to innovate effectively. Macintosh TV would have succeeded if Apple Company had undertaken a customer survey to determine customer propositions.

References

Huddleston, T. (2018). Remember these failed Apple products? They were some of the tech giant’s biggest flops. CNBC; CNBC. https://www.cnbc.com/2018/08/31/from-the-newton-to-lisa-failed-apple-products.html

Lostakova, H., & Pecinova, Z. (2014). The Role of Partnership and Flexibility in Strengthening Customer Relationships in the B2B Market. Procedia – Social and Behavioral Sciences, 150, 563–575. https://doi.org/10.1016/j.sbspro.2014.09.076

Wormald, P. (2013). (PDF) The role of value proposition in new product innovation – a development for design education. ResearchGate. https://www.researchgate.net/publication/279754993_The_role_of_value_proposition_in_new_product_innovation_-_a_development_for_design_education

Ylinen, J. (2014). MANAGING CUSTOMER RELATIONSHIPS Case study LocalTapiola Thesis CENTRIA UNIVERSITY OF APPLIED SCIENCES Degree Programme in Business Management. https://core.ac.uk/download/pdf/38111762.pdf

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Business Model Canvas

Development of the Business Model Canvas (BMC) typically begins with the value proposition expressed in terms of the offerings made to meet market/customer needs. This is what distinguishes an enterprise from its competitors.
An enterprise must put an infrastructure in place to deliver value to the market/customers. The infrastructure includes:
key activities performed to realize the value proposition;
key resources that are necessary to create customer value; and
key partners that deliver customer value indirectly or directly via collaboration with them.
Share your thoughts, ideas, and questions regarding which of the 9 elements are the most important. Include specific real-world examples of business success or failure to help explain your position. In the responses to your peers, share your thoughts on what others have contributed