In today’s uncertain, economic landscape, many businesses are treading water doing the same thing hoping for a different result.
So now is the time to assess, understand and review your business model because regular reviews will enable early detection of business model problems and therefore avoiding the collapse of your company unlike Jessops, Woolworths, HMV and hundreds of so-called ‘safe giants of business’.
A competitive business model that makes sense in today’s environment might be outdated or even obsolete tomorrow. This means that we all have to improve our understanding of a model’s environment and how it might evolve. Of course none of us can be certain about the future because of the complexities, uncertainties, and potential disruptions that are inherent in the evolving business environment. We can, however, develop a number of hypotheses about the future to serve as guidelines for designing tomorrow’s business models.
Assumptions about how market forces, industry forces, key trends, and macroeconomic forces unfold give us the space and time to design and to develop potential business model options or prototypes for the future.
Unfortunately, Business Model Innovation is one of the LEAST used and yet one of the most POWERFUL ways to create sustainable profit growth, economic development and create new markets and competitive advantage.
Exponential’s Managing Director commented, “Exponential was established as a traditional management training and development business back in 1999. Right from the outset I knew I needed to have a strategy to exploit the use of new learning technologies even though I could barely use a PC in those days. We are now on our fourth distinctive business model which has enabled the company to evolve and exploit new market opportunities. By taking the time to reflect and to analyse changes in the economy and market place we have been able to implement both evolutionary and step changes to our business model.”
For most companies, innovation is the key to driving growth, value for shareholders, and competitive advantage. Companies that are not effective innovators will increasingly face more and more challenges, increasing costs, loss of market share and will be over taken by leaner, faster-moving more creative businesses.
The Exponential team routinely asks itself five simple questions:
- How can we improve the financial returns from our current activities?
- What do we need to do to future-proof our business and profitability?
- What are the problems that our customers have right now?
- Who are tomorrow’s customers and what problems might they have?
- How can we update our business model so we add value and make our offer unique?
Five great questions that take some answering! When did you and your management team last take time out to think through these types of questions?
On a final note, maybe Napoleon Hill had a point when he said: “Procrastination is the bad habit of putting off until the day after tomorrow what should have been done the day before yesterday.”
Maybe innovating your business model is something that needs to be done yesterday!