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The evolving business model: just simplify

Edmond Cunningham

British American Business Network

4 September 2014

        
With organisations facing a tsunami of information, markets are becoming more complex and segmented as customers move from groups - to tribes - to one; companies seem to be responding by increasing complexity, resulting in confusion within or a measurable slowing of their ability to respond to change. More than ever, it is critical for companies to alleviate this complexity and simplify their business to meet more demanding market needs and uncover new opportunities for growth.

The best way to do this is by fully embracing and understanding the complexity of your environment and market based on a comprehensive model and data. Determining your focus and prioritizing your approach to addressing market changes using an appropriate business model, enables a company to better determine their priorities and focus.

A shared detailed business model should reflect the current and future ecosystems and enable collaboration and a common language to permeate through the cadre of colleagues and stakeholders. The model should show the inter-relationship between all markets, customers, resources and financials, outlining the values and drivers. This will help organisations develop a solid frame of reference through which they can get alignment.

This frame of reference allows an organisation to be more agile in responding to market changes. They can quickly flex the model with potential market changes and use it to address growth. Scenarios can be derived from it and tested. If you look at how organisations fail to respond – oftentimes it is due to lack of preparedness.

We have a unique perspective on developing business models, which couples design and architecture to give a balanced view of the ecosystem. This is refined by demonstrating the inter-relations between all of these factors and their implications on each other.  This concept is known as business design. 

Today’s speed of change, and the permanence of the rate of change, puts increased pressure on senior management to be more proactive in preparing their organisations to deal with inevitable market changes and evolving their business models along the way. Simplicity allows organisations to react quickly to market changes and create new opportunities. 

 

Edmond Cunningham is a business design expert at PA Consulting Group

 


For thinking and insights on business designclick here or contact us now.    

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