REINVENTING YOUR

BUSINESS MODEL

MD, Yunus ( ID: 6194134035 )

Rakibul Hasan Mazumdar ( ID:6194134032 )
Mahammudun Nabi Emon ( ID: 6184033027)
Zunaed Tanvir (ID: 6194134062)
Naila Karim (ID: )
WHAT IS A BUSINESS MODEL???

A business model is a company's plan for how it will

generate revenue and make a profit.
Reasons Behind Apple’s Success
 Snazzy Design
 Improved Technology
 Indomitable Music Downloading Features in early 2003
 Apple understood that
It’s not the product, It’s the Business Model
market capitalization catapulted from $1 billion in early 2003
to over $150 billion by late 2007 and still counting……
One secret to maintaining a thriving business is
recognizing when it needs a fundamental change!
Articulate what makes your
existing model successful

The Answer is YES,

only if the new model
changes the Market

Decide whether Watch for signal if your

reinventing your model needs changing
model is worth the effort
Steps To Be Followed
• Thinking about opportunities
• Constructing blue print
• Comparing new model
Business Model Elements

 Customer value proposition (CVP)

 Profit formula
 Key resources
 Key processes
Customer Value Proposition

A way to help customers to get an important job done by

solving their fundamental problem with alternative
offerings

Example: Minute clinics enable people to visit a doctors

office without Appointments by making nurse Practitioner
Available to treat minor health issues
Profit Formula
Revenue model : Price * Volume

Cost structure : key assets, direct cost , indirect cost

 Margin model : required transactions for profit level

 Resource velocity : lead time, through put , asset utilization

 Example: TATA Nano is profitable because the company has reduced

many cost structure elements accepted lower than standard gross
margins and sold the Nano in large Volumes to the target market :first
time car buyers in Emerging Market
Key Resources Key Processes

It consists of assets such as Successful companies

 People, have operational and
 Technology,
managerial processes.
 Allow them to deliver
 Products,
value in a way they can
 Facilities, Equipment,
successfully repeat and
 Channels, and Brand increase in scale
Example: For TATA Motors to fulfill the requirements of the Nano's profit formula,
it had to reconceived how the car is designed, manufactured, and distributed its
redefined supplier strategy, choosing to outsource a remarkable 85% of the
Nano’s components and to use 60% fewer vendors than normal to reduce
transaction cost
 How Successful Business Model Works

.
Why Business Model is needed to be reshaped???

Established companies often create new products that

disrupt competitors without fundamentally changing their
own business model
 When a new Business Model is needed ???
These 5 circumstances often require business model change
An Opportunity to………..
Address through disruptive innovation the Example: TATA Nano’s goal is to open a
needs of large groups of customers who are car ownership to low-income
shutting out of a market because existing consumers in emerging market
solutions are too expensive or complicated.

Capitalize on a brand-new technology or Example: Offering military technologies

leverage existing technology in new market in the commercial space like drone, GPS
etc.

Bring a job-to-be-done focus where one does Example: FedEx focused on fulfilling an
not yet exist entirely unmet customer need to receive
packages far, far faster, and more
reliably
 A Need to………..
Fend off low-end disrupters Mini-mills threatened the integrated
steel mills a generation ago by making
steel at significantly lower cost.

Respond to shifts in competition Power-tool maker Hilti switched from

selling to renting its tools. Low-end
entrants had begun chipping away at the
market for high-quality power tools.
 Dow Corning’s Strategy
 Dow Corning discovered creating a new model for a new business does
not mean the current model is threatened or should be changed. A new
model often reinforces and complements the core business
 Traditionally high-margin team found new opportunities in low-
margin offerings by setting up a separate business unit that operates
in an entirely different way.
 Recipe of a successful Business Model !!!!!

1. Break the Rules

 To identify all of the necessary parts of a successful business model.

 To succeed, Dow Corning would have to break the rules that had
previously guided its success.

 To nurture the opportunity and also protect the existing model a new
business with a new brand identity might be needed.
 Recipe of a successful Business Model !!!!!

2. Identifying new Competencies

 To understand how the model fulfills a potent value proposition in a

profitable way.

 New abilities would have to be brought into the business for its
success.

 Making snap decisions and taking big risks might be a vital part in
some cases.
 Recipe of a successful Business Model !!!!!

3. Be patient for growth but Impatient for Profit

 To judge how well the existing model could be used to fulfill a

radically different CVP.

 To tolerate initial failure and be patient for growth in case of the

companies with new business models.

 But be impatient for the profit which is a indication of a viable model

 Recipe of a successful Business Model !!!!!

4. Envelop new Technology in the appropriate model

 What is needed to do to construct a new one.

 To succeed, new technology is must in an appropriate, powerful

business model.
 THANK YOU

ANY QUESTIONS???