Business Model Canvas

The Business Model Canvas is a visual tool that facilitates the ideation, innovation, analysis, assessment and understanding of an organization’s business model. The canvas consists of 9 building blocks that together describe how an organization creates and captures value, for whom that value is created and how that value is delivered. Due to the graphical nature of the canvas it enables people with diverse backgrounds to easily work with and improve an organizations’ business model.

The 9 building blocks are:

  1. Customer segments
  2. Value proposition
  3. (Distribution channels)
  4. Relationships
  5. Revenue streams
  6. Key activities
  7. Key resources
  8. Key partnerships
  9. Cost structure
Business Model Canvas Template

Background

The building blocks that together form the canvas were originally proposed in 2004 as part of the Ph.D research [1] performed by Alexander Osterwalder and was later published in the book Business Model Generation [2]

Use and application

The business model canvas is widely used in startups and established companies alike. Due to it’s design it allows for rapid iteration and ideation. It is a favorite tool in business strategy and can be used in a workshop setting to really make the business model a source of innovation for a company. This is especially true for startups who have no vested interest in an existing business model that is hard to change. This is one of the reasons that startups are able to sometimes disrupt entire industries by applying a radically different business model that allows them to quickly scale.

References

References
↩1 Osterwalder, A., 2004. The Business Model Ontology: A Proposition In A Design Science Approach. Ph.D. University of Lausanne.
↩2 Osterwalder, A. and Pigneur, Y., 2010. Business model generation. 1st ed. Hoboken, N.J.: John Wiley & Sons.