Case 2: Reinventing Your Business Model

Question 1

What is the roadmap that a company should have in order to be reinvent their business model?

Answer 1

1) Think about the opportunity to satisfy a real customer
2) Construct a blueprint laying out how your company will fulfill that need at a profit.
3) Compare that model to your existing model to see how much you’d have to change it to capture the opportunity.

Question 2

What the business model consist from the point of view of HBR?

Answer 2

It consists of four interlocking elements that, taken together create and deliver value.

Question 3

What are the four interlocking elements ?

Answer 3

• Customer value proposition
• Profit formula: Revenue model, cost structure, margin model, resource velocity
• Key resources
• Key products

Question 4

What are the 5 strategic circumstances that often require business model change?

Answer 4

1. The opportunity to address, through disruptive innovation, the needs of large groups of potential
   customers who are shut out of a market because existing solutions are too expensive/complicated
   2.The opportunity to capitalize on a brand-new technology by wrapping a new business model
   around it, or the opportunity to leverage a tested technology by bringing it to a whole new market
   3.The opportunity to bring a job-to-be-done focus where one does not yet exist.
   4.The need to fend off low-end disruptors.
   5.The need to respond to a shifting basis of competition. Inevitably, what defines an acceptable
   solution in a market will change over time, leading core market segments to commoditize.