Design Thinking

Chapter 18Business Model Design

John Aceti

Analogy partners LLC

Tony Singarayar

Analogy partners LLC

Introduction

In 2006, Henry Chesbrough wrote in the opening lines of his now classic book, Open Business Models, that “knowing that innovation is a core business necessity is not news, but that innovating a business model is news.”(Preface xiii) Today, thinking about innovating your business model has become more common and less news worthy. What is news, though, is the currently available methodologies by which business models may be analyzed, designed, and implemented. For this reason, business model design is appropriate in a volume dedicated to design and design thinking.

Business model design will be of greatest interest to: executives responsible for finding better ways to compete, product managers who look to launch a new product, research and development (R&D) managers who need to prove their innovation has market value, or marketing managers who look to increase market share. Many of these professionals have already heard of business models, but in our experience they lack an ability to articulate exactly what their model is or how it works.

Although innovative business model thinking is becoming more prevalent, there are still lingering questions as to what it is, what is its value, and where does it fit with design thinking and strategy. This chapter addresses these questions and more. We will show how business model design can insightfully provide bold new opportunities ...