Project: Business Model
Anatomy of a Business Opportunity
- Three C’s: Identify the specific capacities, capabilities, and competencies of the company. The physical, mental, financial ability and legal right to meet customer expectations.
- Opportunity: Is there a favorable or advantageous set of circumstances that you can exploit to create a unique advantage in the market.
- Motivation: What are the events surrounding their life that causes them to become aware of the need for your products or services? Define who, what, and when people look to buy. What is the Buying Cycle? Is the market accessible and cost effective to reach? Or will you need to find a way to prompt, motivate, inspire or instigate customers into action? What methods or steps will need to be taken to establish the need for your product or service in the mind of your customer?
- Environment: What is the industry situation? Is your market stagnant, declining, or growing? How do you know? What does the financial health of the industry look like? Is there something you can exploit to spur growth and development in your business?
Value Configuration
- Market Needs: What drives people to purchase the products or services in your industry? Research and identify customer Needs, Wants, Emotions, and Perceptions. Where are the roadblocks? What prevents people from buying your products or services? your company, staff, products, and services.
- Ideal Customer: Create a Profile of your ideal customer, the target audience for a business’ products and services.
- Document the Value Added Chain: In this step we examine the activities, events, and time occupied at each step in your value added chain. This step defines what you will do to create value to each step of the customer experience.
Design the Customer Experience
- Blueprint the Customer Experience: This will include everything you do to develop a great customer experience, the manufacture/preparation of the product or service, your sales system, plans for distribution, and the consumption or delivery of the product/service. Create a flowchart or diagram of the path you need/want a customer to take to ensure they have a great experience for your customer. It must identify the path they will travel as they consider buying and taking delivery of your product(s) or service(s).
- Sales, Marketing, & Distribution/Delivery: How you will manage customer relationships and the means by which you will deliver your products or services to customers. This includes your sales, marketing and distribution strategy i.e. the process you will use to establish a link between the company and its different customer segments.
Create the Financial Model
- Revenue Generation: The marketing, sales, and promotion tools and systems you will use to acquire new customers
- Build Budgets: Develop a spreadsheet of your Production and Overhead costs.
- Examine Viability: What is your break-even point?
- Sensitivity Analysis: Test different scenarios of changes in your assumptions, revenues, and costs. Study the impact of these changes on the financial viability your projections.