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Simple guidelines to manage your Business Model Innovation.
If you are reading this blog you are probably thinking of improving your business model. But how to manage this?

In the Envision project we conducted 115 case studies, where we have studied how micro, small, and medium sized companies (SMEs) improve their business models. As you might guess, our research confirms that business model innovation looks easy but that implementation of ideas are complex and needs careful management attention.

 

Look at the bigger picture

Instead of trying to delimit the changes to only some elements of the business model, SMEs should consider the whole business model, and especially focus on the offering and collaboration with business partners. It seems that in (re)designing business models managers in the SMEs are struggling with abundance of options: success seems to require a combination of service innovation, branding, promotional activities, channels, target markets, enabling technology, re-organised networks, and revenue models.

 

Useful guidelines for Business Model Innovation

Probably, this all sounds recognizable, but now the translation to a hands-on approach. From where and how can you start reviewing your business model and look for this collaboration to strengthen your business? Based on our survey and insights from the cases we provide some guidelines:

1. Does your business need a make over? If the market is on the move, or your company performance is dwindling, take a good look at your current business model.

2. Use business modelling method(s) and tools, such as the one we are offering on this platform and tools to gain better understanding of your business model and the potential for change. We’ve gathered and developed all the tools you need to do so. Ask for help from consultants, researchers or other experts if you are unfamiliar with the tools or feel uncertain.


3. Do not think that you can delimit the changes to only some parts of your business model. The business model innovation will most probably mean changes to your offering, but also for your collaboration with business partners as well as target market, revenue model and information technology. There is no single panacea.

 

How to make a good start in changing your business

Even though there is not one answer or approach, the below suggestions can help you making a good start:

- Consider if you can improve your current service or product   offering with some add-on service or differentiate it with for example by (un-)bundling it with other products or services.

- Pay attention to your business partners. Key partners are core to your business model. That does not only apply to suppliers, but also to your customers. For instance, can your custome become your partner, in co-design of new offerings, or can key partners become a channel to reach new customers? Collect data on customers and on their (usage) behaviour.

- Rethink your  customer segment or  target market from multiple sides.

- If you have limited finances, instead of major investments in own information technology and digitalisation, look for simple solutions based on cloud technologies or platforms in combination with apps to meet your requirements. 

The above steps and tools have helped many SME’s worldwide already in getting started and come up with better, more effective business models and market approach. We wish you all the best in improving your business. You really can start your business make-over today.

 

Interested to learn more? Read the following https://www.researchgate.net/publication/317956402_Business_Makeovers_Case_Survey_on_SME_Business_Model_Innovation.

 

If you have questions or feedback, please contact Marikka at marikka.heikkila@utu.fi