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Enterprise

MindMap Gallery Discover business models

Discover business models

Commerce arose in the Shang Dynasty during the pre-Shang period. In its early stages, commerce was a social activity conducted in the form of barter. Later, it developed into an economic activity that uses currency as a medium for exchange to achieve commodity circulation.

Edited at 2021-08-05 18:32:55

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Discover business models

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Outline

Discover business models

Preface

When creating a business model, three issues need to be considered:

Keep thinking about who your “stakeholders” are

Analyze “what value can be exchanged” by stakeholders

Design a win-win “deal structure”

business model

What is your “positioning”?

What kind of "business system" should be established?

Which "profit model" to choose?

What “key resource capabilities” are needed?

What kind of "free cash flow structure" does it constitute?

Strategy and Business Model

Strategy determines the company’s positioning and the value it provides its customers

The business model determines how to achieve the company's positioning and deliver the expected value

Innovation is divided into two categories

technological innovation

Business model innovation

Insight into business models

business model

definition

A business model is essentially a transaction structure for stakeholders

The business model solves the strategic problem of corporate strategy formulation, and is also a bridge connecting customer value and corporate value.

theory

Michael Porter

"Competitive Strategy"

Pay attention to the development of enterprises at the company level

Jack Trout

"position"

Focus on the company’s specific products and services

Philip Kotler

"Marketing Management"

STP theory

Focus on product marketing

Positioning is about establishing a more direct and concrete link between the strategic and executive levels

constitute

business system

The business system refers to the business links needed for the company to achieve its positioning, the roles played by each partner, and the methods and content of stakeholder cooperation and transactions.

structure

Industry value chain

Internal value chain of the enterprise

Partner's role

Business system is the core of business model

key resource capabilities

Key resources and capabilities are the important resources and capabilities needed to make the business system run.

Profit model

Profitability refers to how a company obtains revenue, allocates costs, and makes profits

free cash flow structure

The free cash flow structure is the cash income generated during the operation of the enterprise after deducting cash investment. Its discounted value reflects the investment value of the enterprise using this business model.

Corporation value

Enterprise value, that is, the investment value of a company, is the discounted value of free cash flow that the company expects to generate in the future.

The investment value of an enterprise is determined by its growth space, growth ability, growth efficiency and growth speed.

The company's positioning affects the company's growth space, business system, key resources and capabilities, affects the company's growth ability and efficiency, plus profitability, will affect the company's free cash flow structure, that is, it affects the company's investment scale, operating cost payment and The ability and speed of sustained revenue growth, which in turn affects the investment value of the company and the efficiency and speed of corporate value realization.

Business model and management model

The management model includes strategy, organizational structure, management control, corporate culture, human resources management, and performance. The management model reflects the company's execution mechanism.

Business model includes positioning, business system, key resources and capabilities, profit model, free cash flow, and enterprise value

The business model is the basic structure of the enterprise, similar to a battleship, and the management model is similar to the fleet officers and soldiers driving the battleship.

The management model focuses on the determination of the company's long-term goals and the achievement of performance, while the business model builds a bridge between meeting customer needs, creating value for customers and maximizing corporate value.

The management model emphasizes the execution ability of the organization and the people in the organization, while the business model tells everyone how the enterprise operates and reflects the operating mechanism of the enterprise.

position

How can companies position themselves?

Define the business of the enterprise

four methods

Define your business in terms of the products and services it sells

Emphasis on defining an enterprise's business for certain or all needs of a certain type of customer group

Determine the company's business based on the industry value chain link in which the company is located

Define the enterprise's business according to its key resource capabilities and their combinations

Target customers

three methods

Radically question existing customers’ mind-sets

Start thinking from different angles

Select customers based on the company’s resources and core capabilities

What kind of products and services does the company provide to its target customers?

experience

Existing gaps represent opportunities

do what you are good at

Find a balance between persistence and change

positioning role

Business positioning is a bridge that communicates the past - the existing bridge, the present - its own characteristics, the future - the determination of the business model and the embodiment of the final corporate value.

business system

Identify business stakeholders

What business activities do I have or can engage in?

What business activities can the surrounding environment of the industry provide me with?

What value can I provide to relevant entities?

From a win-win perspective, how can I form these business activities into a value network and allow stakeholders to get the benefits they want?

step

Find the right niche

Analyze your own strengths and see what resources and capabilities are needed

Build a stakeholder network

Focus on the business system to build the operating mechanism of the entire business model

key resource capabilities

resource

financial resources

physical resources

human Resources

information

intangible resources

customer relations

company network

strategic real estate

ability

Organizational skills

material capabilities

trading ability

knowledge ability

Two methods

Determined according to the requirements of other conditions of the business model

Build a business model with key resource capabilities as the core

Focus on a single capability element within the enterprise and find and build other stakeholders that can be combined with that capability element.

Effectively integrate capability elements within the enterprise's internal value chain to create more competitive value chain outputs

experience

Different business models generally require different key resource capabilities.

The enterprise has its own key resource capabilities and uses these key resource capabilities to control other resource capabilities

Profit model

definition

Profitability is the source and method of corporate profits, and solves the problem of how the company itself obtains profits.

A profit model that taps the value of attention

“Razor blade” profit model

Free cash flow structure and enterprise value

investment value

The discounted value of the free flow expected to be generated by the investment object (project/business/enterprise) in the future

Whether an investment is worthwhile is determined by three factors

The term structure (FCF) of the free cash flow that the investment project is expected to generate in the future.

Duration of future expected free cash flow (H)

The rate of return required by investors, or the investor's opportunity cost (r), which is the cost of capital, reflects the company's expected future cash flow risk

Free cash flow from two perspectives

Total capital free cash flow

Equity Capital Free Cash Flow

The investment value of an enterprise and its realization efficiency and growth rate are determined by its growth space, growth efficiency, growth ability, growth speed and growth inclusions.

Growth space is affected by corporate positioning

Growth efficiency is closely related to business model

Growth capabilities are closely related to management mechanisms and execution capabilities, and are also related to business models.