business models

© Copyright 2006By InnovationLabs Business Model Innovation

Business Model

byLangdon Morris

Innovation


modelswhy

?


“point of view

80 IQ points”is worth

Alan Kay


Chip capacity (Moore’s Law) ...Use of Fax Machines ...Use of Cell Phones ...Use of Internet …Information Excess ...Growth of Human Population ...Consumption of Resources …Increasing Pollution …

Exponential Change!


2004-11-08

New Scientific Consensus: Arctic Is Warming RapidlyREYKJAVIK -- The Arctic is warming much more rapidly than previously known, at nearly twice the rate as the rest of the globe, and increasing greenhouse gases from human activities are projected to make it warmer still, according to an unprecedented four-year scientific study of the region conducted by an international team of 300 scientists.


Human Population: Fundamentals of Growth Population Growth and Distribution

In 2000, the world had 6.1 billion human inhabitants. This number could rise to more than 9 billion in the next 50 years. For the last 50 years, world population multiplied more rapidly than ever before, and more rapidly than it will ever grow in the future.

Anthropologists believe the human species dates back at least 3 million years. For most of our history, these distant ancestors lived a precarious existence as hunters and gatherers. This way of life kept their total numbers small, probably less than 10 million.

http://www.prb.org/Content/NavigationMenu/PRB/Educators/Human_Population/Population_Growth/Population_Growth.htm


http://www.de.tomshardware.com/business/20030219/images/17.jpg


http://qsi.cc/blog/archives/cat_finance_economics.html


How you manage here

Is not the same as how you manage ...

here

chan

ge ga

p


You are here*

*Manage accordingly

© Copyright 2006By InnovationLabs Business Model Innovationcomplexity

complexitycomplexitycomplexity

complexitycomplexity


Bethlehem Steel1857 - 2003

ATT1885 - 2005

Sears1886 - 2005

Oldsmobile1897 - 2004

Compaq1982 - 2002

Creative Destruction

Volvo1927 - 1999

Webvan1998 - 2001

DEC1957 - 1998

Netscape1994 - 1998

etc., etc., etc.

Chrysler1925 - 1998


Auto Industry


Sept 8, 2006


1970

Auto Industry Market Share: US Market

1990 20001980


hard to do

?


hard to do

?

The Prelude: Delphi in Bankruptcy January 1, 2006: 27,500 Unionized WorkersJanuary 1, 2007: 7,400 Unionized Workers

The Real Show: GM in Bankruptcy? January 1, 1990: 358,000 Unionized WorkersJanuary 1, 2006: 137,000 Unionized WorkersJanuary 1, 2010: ??? Unionized Workers


customersupplier

Traditional Products and Services

Traditional Distribution

The Past

Feed back


customersupplier

Exchange of information and knowledge, bi-directional, in real time ... Before the sale, during the sale, after the sale ... Face to face, at a distance, across the internet ...

The Knowledge Channel

The knowledge channelTraditional Products and Services

Traditional Distribution

Feed back


?

What does GM need?

A new Business

Model


model?

whatbusinessis a


brand

technology applied

products & servicesways of communicating

supply chain

busi

ness

mod

el

+organization

a business is a system

that occupies a niche in an ecosystem


a business model

A business model describes and how a company is organized and operates to deliver those experiences.

… creates what customers experience. Those experiences shape the game of business.

Business Model Warfare is intentionally creating customer experiences that result in competitive advantage.


InnovativeBusiness

Models

StagnantBusinessModels


This is a mobile telephone.This car company is a telephone company.

* Motorola Digital DNA


This is a mobile telephone.This clothing company is a telephone company.


Now available:E-mail

Satellite TVInternet

This is a portable telephoneThis airline manufacturer is a telecommunications provider.


A Parable of Business Model Warfare

10 companies succeeded.They changed their business model.

10 companiesfailed.

They stayed with theiroriginal business

model.

The difference betweensuccess and failure

in Venture Capital investing.


modelingthe market


Diff

eren

tiate

d/C

usto

miz

ed Com

modity / M

ass

High Wealth

Low Wealth

Used Cars

Rolls Royce

GMFord

ToyotaHonda

Public Transportation

LexusMercedes

BMW

Transportation Market

Ferrari


Diff

eren

tiate

d/C

usto

miz

ed Com

modity / M

ass

High $$

Low $$

Chevrolet

Pontiac

Buick

OldsmobileCadillac

GM Business Model: 1925 - 1980

Used Cars


GM


Diff

eren

tiate

d/C

usto

miz

ed Com

modity / M

ass

High Wealth

Low Wealth

Chevrolet

Pontiac

Buick

Saturn

Cadillac

GM Business Model: 2006

Saab

Hummer

Onstar

GM

Fin

ance

Used Cars



GM Profit: 1975

Making&

SellingCars

FinancingCars


GM Profit: 2006

FinancingCars

Making&

SellingCars

$500 million $2,500 million


Profit: 2020?

Tele-communi-

cationsin Cars

FinancingCars

0 million

$2,500 million

Making&

SellingCars

$25,000 million

QuickTime™ and aTIFF (Uncompressed) decompressorare needed to see this picture.


IBM Business Model

Ser

vice

s

Fina

nce

Sof

twar

e

Har

dwar

e

2004

Ser

vice

s

Fina

nce

Sof

twar

e

Har

dwar

e

1990


IBM“Industry contraction in recent years has forced IT companies to choose between being high value innovation players or high volume distributors of other people’s intellectual capital. Companies that are caught in middle run the risk of being hammered from both below and above.

“IBM is an innovation company.”

IBM Annual Report 2004

See also:IBM PC DivisionATTCompaqSearsLevi StraussK-MartOldsmobileMercuryBuick


Quality

Price

Macy’s

Target

eBayGarage Sale

WalMartDollarStore

Tiffany

Sears

Modeling the Retail Industry

Thrift Store

Service T

hreshold

Louis Vuitton

Gucci

?

Nordstrom


Incremental Breakthrough Product & Technology

Business Model

New Venture

time


Langdon MorrisInnovationLabs

[email protected]


http://www.wheelsafe.co.za/4b5c8e10.jpg

http://www.davesdaily.com/

http://www.funtown.com/signs2/pic.jpg

It’s Confusing to Deal with Change …In Summary:


http://www.quadranet.org/tokezone/itchy/pix_oz/images/Road%20signs%20on%20the%20Nullarbor%20highway.jpg



New Business AheadModels



Changes Ahead!



Thank You!

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