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Department of Services Engineering and Management

02 de maio de 2019

Business Model Canvas

Widely known in the business world, the Business Model Canvas is a spreadsheet used by many corporations to define the main aspects regarding commercial and operational aspects. It gives a systemic vision of the company and it’s one of the great allies in the moment of defining the best strategy.

The Business Model Canvas is composed by 9 elements as bellow:

1. Customer Segment: group or groups of people which the company aims to reach or serve, for instance mass market, niche market, segmented, diversified, multi-sided platform and others. The correct definition of customer segments is primordial to establish the other aspects of the Business Model;
2. Value Proposition: relates to what the company offers to the customer segment(s) in order to solve their problems and attend to their needs. Some examples of features used to define it are newness, performance, customization, “getting the job done”, design, brand, status, price, cost reduction, accessibility, convenience and so on. To each customer segment, must be a value proposition;
3. Channels: describe how the value proposition is delivered to customer and may consider the activities of awareness, evaluation, purchase, delivery and after sales;
4. Customer Relationship: defines the types of relationship the company establishes with each customer segments. It may be done through personal assistance, self-service, automated service, communities and others;
5. Revenue Streams: describes how the company aims to make money by delivering the value proposition. Some examples are: asset sale, usage fee, subscription fees, lending, renting, leasing, brokerage fees and advertising;
6. Key Resources: assets which the company must have to deploy the previous items. For instance, physical, intellectual, human and financial;
7. Key Activities: activities deployed using the key resources that enables the company to deliver the previous items. Some examples are: production, problem solving, platform and network;
8. Key Partnerships: relates to partners and suppliers that are necessary to make the Business Model works. The key partnerships may optimize and promote economy of scale as well as reduce risk and uncertainty;
9. Cost Structure: describes the main costs related to the previous aspects. In general, may be divided in fixed and variable costs.

Finally, defining a Business Model Canvas shifts the perception of companies once centered in organizational issues in order to focus the efforts on who really matters: the client! What leads the enterprise to a successful path.

Source: OSTERWALDER, A.; PIGNEUR, Y. Business model generation. Handbook for visionaries, game changers, and challengers. Hoboken, New Jersey: Wiley; 1 ed., 2010.

Starlight Software

By Helena Depiné

Department of Services Engineering and Management

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