October 26, 2022

Using Business Model Canvas to Express Future-State Business Model

One of the tools that I have found very valuable in supporting business architecture is a business model canvas (BMC).

The BMC has somethings in common with business capability modeling, process modeling, and operating modeling.

For instance, it can be used as a very powerful way to address executive questions and create deliverables that guide investment decisions.

The question is, how can we use Business Model Canvas (BMC) to support business transformation?

What is a Business Model Canvas?

Business model canvas is a framework that was created by a German company called Strategizer.

It is a simple but elegant way to visualize your business model.

The basic structure for a BMC model is that the upper left-hand side expresses what resources, activities, and assets the business has, to deliver products/services to the market.

The upper right-hand side of the model expresses how the business reaches, grows and supports its customers.

The bottom section expresses the financial picture in terms of costs and revenue.

In most cases, I have used BMC in workshops to help teams explore their business using sticky pads and markers.

It can be a great way to get everyone on the same page with regard to the business model.

It can also be used in combination with other frameworks like a balanced scorecard to develop metrics that instantiate the business model.

It can be used to explore different business scenarios using scenario planning processes like “The Art of the Long View.”

How Can A Business Model Canvas be Used During Business Transformation?

One of the issues I have found with how organizations use business model canvas, however, is that they primarily use it to express their current-state business model.

While this may be slightly interesting as an F.Y.I., it really doesn’t help or address issues, opportunities, and challenges to making future investment decisions.

There is nothing inherently limiting about using BMC to express potential future-state business models.

It can be used to explore possible business strategies and business models that would support those strategies.

It can be used in combination with a business capability model, as a mash-up, to understand the impact of target business capabilities in parts of the business model.

It can also be used to help represent changes over time by using it in combination with a business roadmap.

Bottom Line

Business model canvas can be an even more impactful tool in the portfolio of a business architect.

It is important to note that the BMC should be used to express the future-state first rather than just the current-state business model.

To support business transformation, business architects must use it focused on the future-state first and foremost.

Business architects should learn how to use business model canvas, and then play with combining it with other models and frameworks to better inform investment decisions.

Title says business architecture and corporate building

Using Business Model Canvas to Express Future-State Business Model