TITANIC Rei

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SYNDROME As y
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Why Companies Sink and

How to Reinvent Your Way Out
of Any Business Disaster

WRITTEN BY
Nadya Zhexembayeva
with Ilya Galushin and Maxim Gorbach

CO-CREATED BY
Community of 500+ reinventors
and 17 pioneering companies from 27 countries

DESIGNED BY
PRESIUM
TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

REINVENTION TOOLKIT №2

BUSINESS MODEL
REINVENTION
CARDS

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 TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

Building your reinvention toolkit

Welcome to your newest Reinven- 3. You can always combine cards —
tion Tool — Business Model Reinven- as some business models go par- SORTING OPTION 1
tion Cards! ticularly well together. During
YES MAY BE NO
your brainstorming session,
These cards help you structure, dis-
write down all the ideas of how
cuss & develop projects. You can use
the business model might look
them to clarify your thinking, engage
like for your company on sticky
your team in a systematic well-struc-
notes, and put all of them on a wall,
tured discussion, or run workshops
a flip chart, or a table in front of
for your clients.
you.
We suggest you print the cards and
4. Refine and enhance the ideas you
cut them out for easier use.
came up with.
Here are some general guidelines
5. How about this: If you are work-
and options for the ways to use the
ing in a large group divided into
cards - but you are welcome to come
smaller teams, present the best
up with more. You can do this indi-
solutions from each team to the
vidually, in a small group, or in a large SORTING OPTION 2
whole group. Organization preparedness
group divided into smaller ones.
6. Plan the next steps for bringing
1. Place the cards on a table. Go
new ideas into reality. Concrete
through each one of them to
decisions about who, what, when
get familiar with all the different
should be done next — as this is
business model options.
the best way to assure your ef- Industry impact
2. Discuss the pros and cons of forts go beyond talk into action.
each business model with your
team (or by yourself) by sorting
the cards in the categories shown
on the right side of the page.

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TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

ADD-ON 01 CASH MACHINE 02 CROSS-SELL 03

The core product is  offered at  a  competitive price, A  customer is  required to  make an  up-front Cross-selling means selling additional goods and
while the total value of  products or services sold payment for all goods and services, even before services to an existing customer. Here, you are not offering
increases significantly due to  numerous add-on a  company covers its associated costs. The result- a  replacement for what customer already bought  —
options. The benefit to  the client is  in  the ability ing liquidity can be  used to  pay off debts or  to but rather a  supplement or  related product based on 
to  build a  custom solution that fits their specific invest in other areas. customer’s interests and needs. Especially in  retail,
needs. The key to  you, as  a  company, is  to  offer companies easily provide products and services that are
high-margin add-on features and benefits. complementary in nature. This way more needs of po-
tential customers are met at once — while additional in-
come is generated with relatively minor changes to the
existing infrastructure and assets.

Examples Examples Examples

Southwest Airlines: Anything including seat Groupon: Get a discount by paying for your product BestBuy: Get a deal on a computer case, mouse, and
selection is extra or service up front screen cleaning wipes when you purchase a new
laptop.
McDonalds: “Would you like fries with that?” Any B2B manufacturer: 20-50% deposit prior to starting
the order Geico: Get a great rate on homeowners insurance

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TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

REWARDS-BASED CROWDSOURCING
04 05 E-COMMERCE 06
CROWDFUNDING a.k.a. OPEN INNOVATION

A  product, project or  startup is  funded (usually A task or problem is solved by a group of anonymous Traditional goods or services are offered through
via the Internet) by  a  group of  investors who want users, usually via the Internet. Contributors receive Internet channels, which reduces overhead costs asso-
to support the idea. When a critical mass of funding a small reward or an opportunity to win a prize. Cus- ciated with managing the infrastructure of brick-and-
is  reached, the idea is  implemented. The investors tomers get engagement and positive experience. The mortar branches. Customers benefit from convenient
receive a reward: typically, supporters of the campaign company gets tons of ideas and solutions for free. time-saving interaction and a wider range of products
get an  opportunity to  pre-purchase the product or services.
at attractive prices. Other rewards can also be used
commensurate with the amount of money invested.
Newcomers use crowdfunding as  an  alternative
cheap financing option. Big corporations utilize it for
market research and product testing.

Examples Examples Examples

Pebble: Fund our smartwatch via Kickstarter in May LEGO: Come up with a new LEGO set idea and soon Zappos: Buy shoes (and much more) online and get
2012 and we will ship it to you in January of 2013 you will see it in stores! amazing customer service

General Electric via it’s subsidiary FirstBuild: Support 99 Designs: Send your logo design ideas that match Dollar Shave Club: Get your razor cheaper than anywhere
our campaign on Indiegogo in 2015 so that we can the customer need — and if the customer picks you, else — delivered to your door
launch the Opal Nugget Ice Maker (and do some market you get a big chunk of money!
research as we go).

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TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

FREEMIUM 07 FRANCHISING 08 LICENSE 09

The company offers a basic version of the product The franchisor, who owns the brand name, products, To create value with this business model, you develop
or service for free and drives the further purchases and corporate image, sells them under the license a solution (often based on a unique intellectual property)
of a premium, more enhanced product options. The to  independent franchisees, who assume all risks that can be sold under license to other companies. Your
free version is  used primarily for lead generation of local operations. Franchisor’s revenue is generated customer saves money by  using the product, service
(to  capture contacts of  people) and invites them as part of the income and orders of the franchisee — or content that is developed by someone else — while
to upgrade to the paid version later on. and you, as  the franchisor, maintain considerable you benefit from a new source of revenues. Unlike the
control over operations. Franchisees benefit from franchise, however, your customer has much greater free-
offering a  complete ready-made solutions under dom on how to use the solution. Often the solution your
established brands and get detailed know-how and customer licenses from you is only a part of their business
expert support. model — and they are free to license things from other
providers or develop their own IP.

Examples Examples Examples

SurveyMonkey: Get basics surveys done free with Subway: Own your own restaurant, we provide you Google: Use our Google Maps software as a part of
us, but if you want to ask your audience more than with everything from precise recipes to shop layout! your business offer (that’s what Uber did, and see how
10 questions, buy a premium plan! much money they are making)!
Marriott: You get the building, we will give you all
Skype: Calls within our system are free, but you can the rest! Michael Jordan: Put my name on your shoes and pay me
always get a solution to call real phones or “Skype for for it.
Business” option for the entire company.

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TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

LOCK-IN 10 LONG TAIL 11 OPEN SOURCE 12

The core product is  offered at  a  low-margin price The main share of profits is generated not from large Often utilized by the IT industry, it is a development model
or  is  given for free, while the additional goods volumes of  popular products, but from selling low that encourages collaboration and peer production.
necessary to use the core product, are sold at a high volumes of  hard-to-find items. The long tail busi- Products or  solutions such as  software source code,
price, providing a significant share of income. Thus, ness model is beneficial to the customers who have blueprints, and other documentation are made avail-
customers are locked into a vendor’s world of products a particular “niche” taste or need. It also offers a benefit able to  the public for free. Revenues are generated
and services, while the company is  protected from to  the company: if  you offer a  variety of  such through services that are complementary to the prod-
losing its customers. products in sufficient quantities, the total profits from uct itself, such as consulting or technical support.
small sales result in a significant final amount.

Examples Examples Examples

Gillette: Get our razor for peanuts, we make all money Amazon: Get anything and everything your heart Red Hat: Get our software for free and pay for technical
on the blades anyway desires support services

Nestlé Nespresso: Yes, the coffee machine is shiny, but Netflix: Even the most boring documentary can find Mozilla Corporation: We offer our Firefox browser to all
it only makes coffee with our pods its audience! users for free, but if you are Yahoo or, Google, you as
a company pay us to be included as a built-in search
option in our browser.

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TITANIC SYNDROME February 2019 edition ChiefReinventionOfficer.com

PAY PER USE 13 PAY WHAT YOU WANT 14 PEER-TO-PEER 15

When using this model, customers pay only for what The buyer chooses the amount to pay for your product Often referred to as P2P, this model is based on an idea
was consumed. The actual use of a product or service or service — or doesn’t pay for it at all. Often, a mini- of creating a platform where customers can meet and
is measured — and only then the customer mum recommended amount is set as a starting point. connect. Your job is to offer a platform (most often on-
is billed. Customers get greater flexibility, conve- The customer is allowed to influence the price, while line) for users to interact, sell and buy products or ser-
nience, and better cash flow management, while the the company benefits from growing a loyal customer vices. Users get access to each other. You, as a middle-
company gets better data for consumption patterns base. man, get commissions and fees for advertising on the
and is able to charge more per use. platform.

Examples Examples Examples

Rolls-Royce: Don’t buy our airplane engine — instead, Dallas Theater Center: Get any seat in the house for as Apple Store: Develop an app and we will sell it to all
pay us for the actual hours of the flight. If our engine is little as $1 per ticket iPhone users for a fee
not performing and you cannot fly — it’s on us!
Radiohead: Get our ‘In Rainbows’ album with a "name Airbnb: A place where people who have a vacation home
Car2Go: Who needs to buy a car if you can find it on your price" download for a rent can meet people who are looking for a house
the street, use it, drop anywhere, and pay by the hour? to stay at during their vacation

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Liked the sample cards?
Then you are going to love our book!
Let’s face it: change sucks. Get ready for any iceberg, any

It  is  confusing, overwhelming, and

With a one-time payment of $19, storm, any disaster. Ride the waves

incredibly frustrating. You spend

you get so much more than just a book: of change, don’t get crushed
by them.
countless hours trying to  convince

01
your organizations that is  time An updated edition of the book every few months
to move — only to face fear, resist- full of new cases, new research and more cards
ance, and complete chaos. Often, you

02
feel lonely, attacked, and lost in the Access to a range of tools designed to diagnose and
sea of disconnected efforts, tools, and treat “Titanic Syndrome” within your organization
frameworks.

03
Weekly resources and insights to use for yourself,
It’s time to turn things around — and
your team, your clients. GET YOUR COPY TODAY
we are here to support you every step
of the way!

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