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  • Gunjan Syal

Leveraging Business Model Canvas For Business Model Innovation

Updated: Jun 20

The post-pandemic world is obsessed with building data-driven businesses with positive ROI.

...and rightly so! As businesses progress down this path, the transformation and innovation initiatives must showcase measurable impact projections prior to committing multi-million dollar investments.

This was the focus of a conversation I had with a young leader in March 2022. We discussed the multiple unknowns his business faced as they embarked on a major innovation initiative towards a new business model. This stage requires business leaders to identify "what-if" business model scenarios to gauge positive ROI from our current activities in the future. On the surface, this may appear to be an exercise full of assumptions for day-dreamers. In reality, it can be extremely rewarding, when grounded with clearly defined assumptions and constraints; both internal and external to the business.

I call this approach, 'Dynamic Business Strategy Development' (DBSD). I often recommend this approach to the Chief Strategy Officers (CSOs) and Chief Transformation Officers (CTrOs) at my client organizations. This activity is rewarding as they prepare to tackle change initiatives requiring heavy investments. CSOs and CTrOs must own and operate this activity with full support from the entire CxO complement at their firms. I designed this approach during the pandemic, based on my experience with the early-stage start-ups and enterprise clients at the same time. This approach combines the best of both start-up and enterprise worlds, as we identify novel ways to innovate post-pandemic to overcome supply chain issues.

Before diving into DBSD, it is crucial to internalize important aspects of the Business Model Canvas (BMC) tool. BMCs are commonly used by early-stage start-ups to define and communicate their business models. Enterprises and established businesses do not typically use this tool because of well-established revenue, stakeholder management, and operating models. Yet, this tool can define an informed path forward during the transformational periods, provided there is a clear definition of success. The image below shows key aspects of the BMC.

Business Model Canvas

Here is how I recommend the CSOs and CTrOs engage in DBSD:

  • Collaborate with each C-Level peer (CxOs) to clearly define the milestones, goals, and objectives for their functional areas through the change with a focus on the results at each stage. This provides a specific action-oriented roadmap to each CxO leader.

  • Consolidate all CxO responses from individual roadmaps identified in the step above, into a single roadmap across a timeline horizon. This provides an enterprise-wide roadmap view.

  • Document the current state of the business in a BMC template. This serves as a baseline for the business strategy conversations.

  • Then, leveraging the enterprise-wide roadmap from above, begin crafting 'predicted BMCs' (pBMCs) at major milestones in the consolidated roadmap. These reflect the projected state of the business at particular time intervals, assuming all is well with the enterprise-wide roadmap execution. Choosing an appropriate timeline for the pBMCs is both an art and a science, depending on the speed at which tangible results will be visible and measurable within the BMCs. The image below shows pBMCs across a timeline with 6-month intervals. The last section includes two possible end-states, depending on the outcomes of the previous state and the assumptions.

Dynamic Business Strategy Development
GoEmerald's proprietary Dynamic Business Strategy Development Approach
  • This view helps CxOs see a clear progression within the business at the highest levels, as the transformation activities progress. It is an indication of the company progressing towards a new business model.

  • Each pBMC shows a projected point-in-time view into vendors, revenue model, products, services, resources, channels, and more.

  • When unexpected issues arise on transformations and innovation initiatives, pBMCs can be leveraged by the CxOs to either re-baseline the desired business state at that point in time, or identify other options to achieve the same results as listed in the pBMC.

  • The pBMCs together will show how the products, services, client segments, partners, and other key business dimensions evolve over time as a result of the transformational efforts. These visible changes are an indicator of the Business Model Innovation.

Ultimately, the end goal of DBSD is to enable business model innovation with visible and clearly defined results:

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