Build Initial Strength into New Ones Fast Delivery to Just in Time Differentiated Products
How do you gain major strategic advantages over competitors? It's easy: Build a better business model and then expand on your initial successes by providing more of what customers cannot get elsewhere.
When American Woodmark, a low market share maker of wooden cabinets, first scouted out ways to improve its competitive position, the firm had no strengths to build on. It did notice, however, that customers were unhappy waiting weeks or months for new kitchen cabinets. With the advent of...
A First Aid Kit for Fixing Your Broken Business Model Innovation Process
Almost every business has a first-aid kit to help injured people recover from accidents. It's only common sense.
Yet few of these businesses know how to treat a broken business (or strategy) model innovation process. With these questions, you'll have just the first aid you need to recover from broken processes. Then, you can return your business to health and prosperity.
These questions will help you discover better ways of improving and replacing your business strategy. By using these...
The Many Advantages of Starting First on Business Model Innovation
When I study business model innovation, I often notice the theme of developing close relations with important customer and noncustomer stakeholders:
1. For example, Education Management (a trade school in art education) looked to provide a more productive employee to the largest local, regional and national employers, while making it more economically attractive to obtain this learning.
2. American Woodmark (maker of kitchen cabinets) was optimizing the best way to distribute through the...
Stay Focused on The Solutions You Provided First and Expand on That Strength
Almost all business people work hard and are dedicated to their work. Yet some achieve great benefits from their efforts while others are simply holding the line. What are the lessons of this differential success for those who are working on business model innovation?
Let's start with an analogy. Have you ever watched water break through an earthen dam? At first, the water simply washes against the whole side of the dam. Gradually, the speed of the water and the uneven composition of the...
Test Your Business Model Focus to Gain the Greatest Customer Advantages
I want to pose a few questions that will help you ensure that you are continually improving your business model in the most profitable ways.
1. Where has your current business model made you the first to offer an important stakeholder benefit?
You will have to look back in time to locate this. In the case of American Woodmark, it was providing fast delivery for home centers. If you are not sure what you were the first to provide, ask your customers why they first selected your company....
Seven Essential Questions to Create a Highly Profitable Business Model
Most people have trouble deciding where to start when considering possibilities to establish a better business model. With these questions, you'll make better changes . . . and faster.
1. Do you feel inspired by your organization's current business model?
If you are like most people, the answer will be no. That's just the beginning of your learning. You should go on to ask yourself, what's missing to make me feel inspired by our business model? Go on to ask at least five other people, and...
Refurbish Your Business Model to Gain More Profit and Market Share
Large companies are always selling off operations on which they don't make enough money. It's not unusual for the new buyer to quickly increase the profits, cash flow, and market share.
Why is this possible? It's simple to understand this success: Improve the business model to eliminate the weaknesses that harmed business results under the old ownership.
Let's look at an example to see what's possible.
American Woodmark had been a high volume manufacturer of kitchen cabinets when it...
Let Your Business Model Innovations Grow Like Bamboo
If you live in a tropical climate with good soil, you know that a bamboo shoot that you plant can grow by as much as two inches an hour. That's the kind of explosive expansion that should drive your business model innovations.
When is good enough when it comes to business model innovation? Business people know that the pursuit of perfection can often be folly. You may only get one percent more benefit from adding twenty percent more improvement.
On the other hand, there are places where...
Build on Initial Breakthroughs to Develop Lasting Success A Storage Company Case History
In its initial business model, Iron Mountain focused on providing safe, secure storage of electronic records inside a large cave. This was a requirement of many auditing firms for their accounting clients. With lots of space in the cave, it was natural that Iron Mountain would eventually offer paper storage. Discovering that many national firms wanted to work with one storage company for all their sites, Iron Mountain bought up operations everywhere. The breakthrough it sought, however, was to...
Entrepreneurs Planning New Enterprises Need to Focus First on Business Model Innovation
If you are an individual or a small team not yet operating as a business, starting first on business model innovation sounds like it's impossible. The world is full of long-standing companies that seem to be serving virtually every conceivable need.
However, can you serve those needs with new business models in a better way? Probably you can. And if you can, then you can be the first to compete based on business model innovation.
Notice that business model innovation usually requires more...