Innovate Your Business Model

Octombrie 2009

KURT WEBER - Managing Director Romania AURA CADIS - Senior Project Manager HORVATH & PARTNERS MANAGEMENT CONSULTING S.R.L.

Currently, the ability to innovate is more important than ever to keep pace with business and stay ahead. Inaction is the riskiest response to the uncertainties of an economic crisis and rash or scattershot action can be nearly as damaging. That is the reason why now is the time to challenge your organization with questions like:

• What are the future trends that will impact your business?
• How to make innovation really happen in a business environment that is facing rapid, discontinuous change?
• How to seize new growth opportunities, create new markets and to recalibrate your organization?
• What are the key leadership and innovation skills for the future that will differentiate your business from competition?
• What are the innovation barriers which leaders have to overcome in the daily business?
• How to inspire your employees for innovation and how to create an innovation-friendly climate in your company?

We talk about innovation as being the only possibility to create more value than you did in the past (and present). You can also succeed "copying" or "importing" successful ideas from others, but if you want to sustain your competitiveness in the longer term, there is no way around it, you have to be innovative and in order to succeed, you need to count on homegrown talent... on innovation. This means profitable novelty. Innovation, of course, means doing new things that customers ultimately appreciate and value - not only developing new generations of products, services, channels, and customer experience but also conceiving newbusiness processes and models.

 

Which is the starting point in creating more value?

The business model. The first step for a company to take in a challenging economic environment is to assess in a systematic manner its own vulnerabilities, at the company level and by business unit. A good structure of the business model helps in this regard. But in order to do this, you need to understand what does a business model mean. Business models are stories - stories that explain how enterprises work. A few questions help:

• What makes the existing business successful? What customer problem solves?
• Is there any new competitor that makes exactly the same thing as your company does?
• Does is worth the effort reinventing the business model? Does it bring any change in the business or industry?
• How do we make money in this business?
• What is the underlying economic logic that explains how we can deliver value to customers at an appropriate cost?

• 7C Model

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