The Business Model Canvas represents a valuable framework which is used by many small and big organizations all over the globe. With its flexible yet simple application, it has helped many companies to improve existing products, create new ones, and develop better strategies for the future. If you would like to learn more about the Business Model Canvas and its application, please feel free to get in touch with us.

1. LHBS // TOOLBOX — BUSINESS MODEL CANVAS
A PRACTICAL GUIDE TO
BUSINESS MODELING
THE TOOLBOX SERIES: BUSINESS MODEL CANVAS -
THE WHY, THE WHAT & THE HOW
November 2015
UNDERSTAND TODAY. SHAPE TOMORROW.

2. ABOUT.
THE TOOLBOX SERIES
At, LHBS, we are passionate readers and learners. What we learn, we
like to share. That’s why we’ve created the Tool Box series which is an
ongoing sharing of tools, models and frameworks that we like or that
we have developed ourselves.
This one gives you a new spins on how to better use the business
model canvas throughout the different layers of your
organization.
We hope you enjoy this deck and are able to put it into your
innovation process.
For more consumer and industry insights, check out the LHBS
Inspiration-Hub platform here.
INTRODUCTION
UNDERSTAND TODAY. SHAPE TOMORROW. 2
Discover Define Develop Deliver
UNDERSTAND TODAY. SHAPE TOMORROW.
LHBS // TOOLBOX — BUSINESS MODEL CANVAS

3. UNDERSTAND TODAY. SHAPE TOMORROW.
The easy and flexible framework has helped many businesses,
ranging from startups to big corporations, to shape, test, and
improve their ideas. Even though it is considered as a rather
simple tool, many companies and individuals seem to struggle
when it comes to properly using the Business Model Canvas.
Plenty of great resources that explain and discuss the Business
Model Canvas can be found online; we at LHBS aim to give
Business Modelling a new spin, providing you with helpful
information, while highlighting crucial aspects, and learnings
derived from our experience working with the tool.
Tamara Stix
Consultant at LHBS
lhbs.com | ts@lhbs.com
INTRODUCTION
3
INTRO
DUCTION.
LHBS // TOOLBOX — BUSINESS MODEL CANVAS
Business Modelling– especially by using the Business Model Canvas–
has proven itself as a highly effective and valuable tool for businesses.

4. UNDERSTAND TODAY. SHAPE TOMORROW.
CONTENT.
WHAT
is a business model?
WHY
business models?
HOW
to use a business model?
4
CONTENTLHBS // TOOLBOX — BUSINESS MODEL CANVAS

5. 1.
WHAT
is a business model?
WHAT?LHBS // TOOLBOX — BUSINESS MODEL CANVAS

6. A business model is a
holistic & systematic approach to
define, create & analyse a
business or idea.
LHBS // TOOLBOX — BUSINESS MODEL CANVAS DEFINITION // WHAT?

7. A Business Model delivers a simplified but
comprehensive overview of how a business
functions.
It describes the most important parts of business
based on the value creation and acts as a basis
for defining, analysing, improving & innovating.
Wirtz, 2000Wirtz, 2000
LHBS // TOOLBOX — BUSINESS MODEL CANVAS DEFINITION // WHAT?

8. 8
What are the pillars a business model is built upon?
WHO
is your customer?
WHAT
do you offer your
customer?
HOW
do you do this?
-Markets
-Customer Segments -Products & Services
-Solutions
-Experiences
-Create Value
-Deliver Value
-Capture Value
Value Proposition
LHBS // TOOLBOX — BUSINESS MODEL CANVAS BUILDING BLOCKS // WHAT?

9. 9
Building Blocks
Pillar: Business model building block:
Product Value Proposition
Customer Interface
Customer Segments
Distribution Channels
Customer Relationship
Infrastructure Management
Key Resources
Key Activities
Key Partners
Financial Aspects
Cost Structure
Revenue Stream
LHBS // TOOLBOX — BUSINESS MODEL CANVAS BUILDING BLOCKS // WHAT?

10. 10
Business Model Canvas
Key Partners
Who are our Key Partners?
Who are our Key suppliers?
Which Key Resources are we acquiring
form partners?
Which Key Activities do partners
perform?
Key Activities
What Key Activities do our Value
Proposition require?
Our Distribution Channels?
Customer Relationships?
Revenue streams?
Value Propositions
What value do we deliver to the
customer?
Which one of our customer’s problems
are we helping to solve?
What bundles of products and services
are we offering to each Customer
Segment?
Which customer needs are we satisfying?
Customer Relationships
What type of relationship does each of
our Customer Segments expect us to
establish and maintain with them?
Which ones have we established?
How are the integrated with the rest of
our business model?
How costly are they?
Customer Segments
For whom are we creating value?
Who are our most important customers?
Key Resources
What Key Resources do our Value
Proposition require?
Our Distribution Channels? Customer
Relationships?
Revenue Streams?
Channels
Trough which Channels do our Customer
Segments want to be reached?
How are we reaching them now?
How are our Channels integrated?
Which ones work best?
Which ones are most cost-efficient?
How are we integrating them with
customer routines?
Cost Structure
What are the most important const inherent in our business model?
Which Key Resources are most expensive?
Which Key Activities are most expensive?
Revenue Streams
For what value are our customers really willing to pay?
For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each Revenue Stream contribute to overall revenues?
ValueCapture
ValueCreation
LHBS // TOOLBOX — BUSINESS MODEL CANVAS BUSINESS MODEL CANVAS // WHAT?

11. *Source: 11IBM Global CEO Study, 2006
Business Plan Business Model
Form Textual Visual
Format Document Canvas/Model
Content
Detailed description about
all business aspects
An overview of most important aspects of
business
& their interconnection
Level Explicit & isolated chapters Abstract & integrated
Focus Individual aspects of business
Interconnection & interdependence
of business aspects
Use
Thoroughly understanding
each aspect of business
Getting the big picture
What is the difference between a Business Plan & a
Business Model?
LHBS // TOOLBOX — BUSINESS MODEL CANVAS BUSINESS PLAN VS. BUSINESS MODEL // WHAT?

12. 12
What differentiates a Business Idea from a
Communication Idea?
Communication Idea Business Idea
Goal attention revenue generation
Content involves mainly idea & costs involves internal & external aspects
Concept independent (isolated) interconnected (holistic)
Focus micro macro
Length short-term long-term
Complexity low high
LHBS // TOOLBOX — BUSINESS MODEL CANVAS BUSINESS IDEA VS. COMMUNICATION IDEA // WHAT?

13. EXAMPLE
LHBS // TOOLBOX — BUSINESS MODEL CANVAS EXAMPLE // WHAT?
two companies in the hospitality industry with
completely different business models

14. Key Partners Key Activities Value Propositions Customer Relationships Customer Segments
Key Resources Channels
Cost Structure Revenue Streams
UNDERSTAND TODAY. SHAPE TOMORROW.
AIRBNB
Travel community operators
Airbnb Travellers
Airbnb Home providers
Bloggers
Legal Institutions
Investors
Insurance Companies
Creating technological infrastructure
Community Management
Customer Service
Marketing & Product Development
Brand
Community of home providers & travellers
Data Base with accommodations
Platform
development &
design
HR Marketing
Maintenance of
payment system
trustful & reliable platform
free membership
24/7 Support
Easy to use
rental of unique spaces
use of unused value
property insurance coverage
Support Team
Online & Mobile applications
Website
App
Social Media, Blog
PR Word of Mouth
Commission renters (6-12% of
booking fee)
Commission appartement
owners (3% of booking price)
Travelers:
Budget Travelers
Business Travelers
Globetrotter
Home Providers:
Extra Room
LHBS // TOOLBOX — BUSINESS MODEL CANVAS EXAMPLE // WHAT?

15. Key Partners Key Activities Value Propositions Customer Relationships Customer Segments
Key Resources Channels
Cost Structure Revenue Streams
UNDERSTAND TODAY. SHAPE TOMORROW.
MOTEL ONE
Booking Websites
Operation & Management of
hotels
Hotels at central locations
low-budget accommodation
combining attractive prices, high
quality and central locations
no-frills concept combined with
modern design
hotel-rooms reduced to what
guests really need
5* for a 2* Price
Standardised offer across
locations assures people to get
what they expect
Own Website
Via Mobile Device
Booking & Travel Websites
Budget Travellers
Hotel Operations HR Properties Room fees Extras
LHBS // TOOLBOX — BUSINESS MODEL CANVAS EXAMPLE // WHAT?

16. 2.
HOW
to best use a
business model?
HOW?LHBS // TOOLBOX — BUSINESS MODEL CANVAS

17. *Source: 17
How do organisations actually use Business Modeling?
http://blog.strategyzer.com/posts/2015/2/9/why-and-how-organizations-around-the-world-apply-the-business-model-canvas
15%
36%
9%
19%
21%
New product/service
development within
existing business model
Strategic
Reorientation
Others
Development of an
entirely new business
Renovate old
business model
LHBS // TOOLBOX — BUSINESS MODEL CANVAS USAGE // HOW?

18. 18
Uses of a Business Model
DEFINE DISCOVER DEVELOP DELIVER
-current BM
-analyse & assess
-opportunity
spaces
-new, valuable
ideas
-the right ideas
-testing
LHBS // TOOLBOX — BUSINESS MODEL CANVAS
USAGE // HOW?
BM helps to
define & assess
the current
business model.
Identify ‘white
spaces’ for
growth
opportunities.
Generate valuable,
new ideas &
business models.
Easy way to test
developed ideas
& business
models.

19. USE IT AS A MANAGEMENT TOOL
LHBS // TOOLBOX — BUSINESS MODEL CANVAS MANAGEMENT TOOL // HOW?

20. 20
Business models as a management instrument
Orientation
Strategy
Business Process
Business Model
TypeofInformation
Planning - highly aggregated
Architecture - tactical
Implementation - operative
LHBS // TOOLBOX — BUSINESS MODEL CANVAS MANAGEMENT TOOL // HOW?

21. *Source: 21
Use it on various levels of your organization
Quelle: Business Model Management (Wirtz, 2011)
Industry Model
Industry Level
Company Level
Business Level
Product Level
Company business model A Company business model B
Business unit Model I Business unit Model II Business unit Model I Business unit Model II
Product
Business Model I
Product
Business Model II
Product
Business Model I
Product
Business Model II
Product
Business Model I
Product
Business Model II
Product
Business Model I
Product
Business Model II
COMPANY A COMPANY B
LHBS // TOOLBOX — BUSINESS MODEL CANVAS MANAGEMENT TOOL // HOW?

22. USE IT AS A TOOL FOR INNOVATION
LHBS // TOOLBOX — BUSINESS MODEL CANVAS INNOVATION TOOL // HOW?

23. 23
Business Model Innovation is
about transforming key elements
of your business or
inventing completely new ways of
doing business.
LHBS // TOOLBOX — BUSINESS MODEL CANVAS INNOVATION TOOL // HOW?

24. *Source: 24
4 Types of Innovation
Business Model Innovation, Marc Sniukas
Internal
External
Continuous Discontinuous
Operational
Innovation
Management
Innovation
Product & Service
Innovation
Business Model
Innovation
LHBS // TOOLBOX — BUSINESS MODEL CANVAS INNOVATION TOOL // HOW?

25. *Source: 25
How Business Model Innovation can help…
IBM Global CEO Study, 2006
Entrepreneurs Managers
Market Entry Growth
Commercializing a new technology Competitive Advantage
Create new Markets Fend of new entrants
LHBS // TOOLBOX — BUSINESS MODEL CANVAS INNOVATION TOOL // HOW?

26. IMPORTANT TO CONSIDER…
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

27. “No business plan survives
the first contact with a customer”
Steve Blank
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

28. At the end, a business model is a
hypothesis which needs to be
tested & validated before
execution.
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

29. HOW TO TEST ASSUMPTIONS?
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

30. 30
Test the BM in the canvas by pairing up blocks to check
their compatibility
Customer
Segments
Value
Proposition
Customer
Relations
Channels
Revenue
Stream
Cost
Structure
Key Activities
Resources
Partners
Core External Internal Financials
find
early adopters
optimise
message & channel
utility
testing
currency
testing
*Source: http://focus.customerdevlabs.com/
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

31. “There are no facts inside the building.
So go outside!”
Steve Blank
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

32. Test your BM directly with your
target audience & stakeholders.
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

33. 33
Research Toolbox
– Ask for Feedback: Interviews, Surveys… (Customer & Stakeholders)
– Build a prototype
– MVP: Minium Viable Product
– Pre Sales (Adword Campaign, Kickstarter)
– Measure & track clicks
– Calculate costs (Break-Even analysis, Cash Flow analysis)
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALIDATION // HOW?

34. 3.
WHY
business models?
WHY?LHBS // TOOLBOX — BUSINESS MODEL CANVAS

35. 35
3%
97%
97%of CEO’s
see innovation as a top
priority for business.
*Source: press.pwc.com
≈
LHBS // TOOLBOX — BUSINESS MODEL CANVAS INNOVATION // WHY?

36. *Source: 36
Business Model Innovators outperform traditional
innovators
IBM Global CEO Study, 2006
-1
1
3
5
7
Product/ Services/ Market Innovators Operations Innovators Business Model Innovators
(% of annual growth rate over 5 years)
LHBS // TOOLBOX — BUSINESS MODEL CANVAS
≈
INNOVATION // WHY?

37. *Source: 37
How does Business Modelling create value for its users?
http://blog.strategyzer.com/posts/2015/2/9/why-and-how-organizations-around-the-world-apply-the-business-model-canvas
Contribution None Small Good Major
1 2 3 4
Better conversations on strategy 3.52
Creating a shared language 3.5
Better ideas & brainstorming 3.42
Better teamwork 3.19
Structured, practical outcomes 3.16
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALUE CREATION // WHY?

38. A business model describes your idea or business in a brief & visual away,
so its essence can be easily transferred
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALUE CREATION // WHY?

39. The Business Model Canvas is a useful tool to create
a common understanding of your business
& align your stakeholders and employees
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALUE CREATION // WHY?

40. Effective tool for startups that are pitching their idea to
investors in order to secure funding
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALUE CREATION // WHY?

41. Helps to see the big picture and to
detect strengths and weaknesses of your idea or business
LHBS // TOOLBOX — BUSINESS MODEL CANVAS VALUE CREATION // WHY?

42. READING LIST
LHBS // TOOLBOX — BUSINESS MODEL CANVAS READING LIST

43. 43
Reading List & Tools
- Business Model Generation, Osterwalder & Pigneur
- Value Proposition Design, Osterwalder & Pigneur
- Business Model Management, Wirtz
- Business Model Gallery
- Strategyzer
- Business Model Innovation Glossy Box, LHBS
LHBS // TOOLBOX — BUSINESS MODEL CANVAS READING LIST

44. If you have questions about this
presentation or would like to
discuss how to develop your
business model, please get in
touch.
LET´S GET IN TOUCH
44
Tamara Stix
Consultant
ts@lhbs.com
+49 171 317 9595
LHBS // TOOLBOX — BUSINESS MODEL CANVAS CONTACT

45. UNDERSTAND TODAY. SHAPE TOMORROW.
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