Business and Revenue Models Innovation

Why this course?

Business and revenue models are probably the least understood aspect of modern business strategy. Ask one hundred executives what a business model is and you’ll get for business managers and entrepreneurs today – as important as product innovation in creating new products and services and sustainable competitive advantage. The web has given rise to new business models that have allowed companies such as Google, Skype, LinkedIn, Salesforce, Craigslist and Apple to rapidly build scalable and profitable franchises. The competition (Yahoo!, Vonage, Sony, etc) who did not get it, have lost billions in revenues and market capitalization.

Managers need to understand how to move beyond traditional strategy making and into new ways of thinking. How does a hardware company decide to enter an on-demand new company enter a traditional industry (such as car rental, book publishing, or telephony) and win? A powerful to do this successfully is through business model innovation.

What is this course?

Based on Tony Seba’s eponymous course at Stanford University, this course looks at conceptual and practical frameworks for understanding business and revenue models. We will study the value creation, value capture, value chain, value migration, strategic choices, profit engines, opportunity creation, and more. We look at dozens of different revenue models, break down their components, and survey many possible revenue streams that can be added to a business model. We then present a scenario analysis tool in order to simulate how the business might evolve under different scenarios. We look at real-life cases of how companies developed products and services that were innovative both from the business modeling and product development perspectives.

Note: this is not a spreadsheet modeling or a financial engineering course. This is a new way of thinking about how to create new business and revenue models as well as understanding, refining, and improving revenue models.

The course has a workshop orientation: intense, hands-on, and practical. Come with a product, service, or technology in mind and learn the many possibilities for creating new businesses and new revenue streams. The course is taught over two full days.

Who has taken (should take) this workshop?

• CEOs and senior executives of startup companies
• Product managers or marketing managers looking to develop new products or create new sources of revenues for existing products and services
• R&D managers who need to rationalize development investments into technologies with more commercial potential
• Senior engineers or engineering managers who need to design and build new products that are easier to adopt
• Entrepreneurs starting or running new businesses

When should you take this workshop?

• Are you under attack by new web-based products and services?
• Are you creating a new product and want to fully leverage the Internet?
• Are you in an expansion phase but need to prioritize investments?
• Do you have a ‘great’ technology or product in a great market – but it has failed to gain market traction?
• Are you developing a new product or service?
• Do you need to find new revenue sources for existing products?
• Do you need to identify and capture new markets (but are not sure where to go next)?

Sample schedule (for a 2-day workshop):

Day One

• Understanding business and revenue models. Strategy vs. business models. Finance vs. business models.
• Understanding value – value creation, value capture, value chain, value proposition, economic value to the customer.
• Surveying business and revenue models.
• Value chains – creating new businesses within the existing value chain vs. creating a new value chain.
• Understanding the profit engine
  • Building and analysing financial models
  • Understanding what really matters in a business model
• Understanding the adoption environment
  • Designing a product or service that is easier to adopt

Day Two

• Combining product innovation and business model innovation.
  • How to build a winning web-based product and a new business model simultaneously
• Creating the right new business from a market opportunity. Creating revenue from open source products and services. Understanding
• Case Study: creating, analysing and choosing between two radically different business models.
  • Should you build a new product business within the existing value chain or a new on-demand service business for a new market.
• Refining, revising, and testing business models.
• Understanding what’s critical and how you use this to refine and improve your business model.
• Case Study: creating a new disruptive business model in a traditional industry.