Businesses today are probably the most complex object known to mankind. Edward de Bono makes the observation that businesses become more and more complex over time. We seem to keep on adding “things” to the business which continually increases its complexity. According to de Bono there is no natural route to simplicity despite the fact that he believes that introducing simplicity in your business you can drastically reduce business costs and people stress. The sad thing is that simplicity is not traditionally part of business thinking. Somehow the norm is to make business more complex.
Simplicity seems a key element to me as we explore the architectural route in building our businesses. A lot has been said that we should not be in business just to make money – making money should always be a result of what we do (Simon Sinek). That said, it remains imperative for all business owners to ensure that they clarify the financial viability of each of their offerings. This is not an easy task – in fact most business owners believe it to be too complex to even consider such an endeavour. In our dealings we often come across businesses that could not mention all their revenue streams.
Our research led us to “The Business Model Canvas”. It is a strategic management template for developing new offerings/businesses, challenging existing business models, inventing new ideas or just describing your existing business. It is a visual chart with 9 building blocks describing an organisation’s value proposition, infrastructure, customers, and finances. It assists organisations in aligning their activities by illustrating potential trade-offs. The Business Model Canvas was initially proposed by Alexander Osterwalder (2008) based on his earlier work on Business Model Ontology.
Clarifying your offering for each customer segment, the infrastructure required and the financial viability of each offering could not be more simple but extremely effective as a step in the architectural design of your business.