Business model design

Business Modelling for Success

What is a business model? According to Peter Drucker, considered the single most important thought leader in the world of management, “a business model is supposed to answer who your customer is, what value you can create/add for the customer and how you can do that at reasonable costs.”

“Wikipedia states that “in theory and practice, the term business model is used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, business process, target customers, offerings, strategies, infrastructure, organizational structures, sourcing, trading practices, and operational processes and policies including culture.”

There are many types of business models depending on which industry that you are in from Manufacturing, Distribution, Retail, Franchise, Bricks and Clicks, and more. The important thing is to have a model for your company to explain to anyone what your uniqueness is and how it is going to create value for your customers as well as your company, in a profitable manner.

Here are some of the important items that each model should include:

Vision – Defines the optimal desired future state – the mental picture – of what an organization wants to achieve over time. Includes your values and your “WHY”

Mission – Defines the present state of an organization. WHAT it does; WHO it does it for; and HOW it does what it does.

Value Proposition – A clear statement that describes the benefit of your unique offer, how you solve your customer’s needs and what distinguishes you from the competition. 

Customer Profile – Describes your ideal client categorically so that they can be grouped for marketing and advertising purposes.

Customer relationships – What types of relationships do each of your customer segments require? How do they want you to communicate with them – social media, email, blog, text?

Key Partners – Including suppliers, support, distribution, network, delivery. What resources do they add and what activities do they do that support your Value Proposition?

Revenue Streams – What revenue streams are customers buying now and what ones are you developing for future growth? Which ones are most profitable?

Cost Structure – What costs and systems do you have to deliver and support your Value Proposition? What additional funding is required for growth?

The advisors at the Great Performances Group can help you design and review your business model to ensure that you are delivering maximum value for minimum cost, and doing so sustainably. Then we will work with you monthly, quarterly, or annually to minimize drift and drag and maximize commitment, momentum and success. Contact us now to start the process.

Back To Top