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Approach to Business Modelling

10 Things That Make a Great Business Model


Keep it Simple.  If it is difficult to understand, it probably won’t work

2 Reflect the Values of your organisation.  The model strategy needs to be consistent with the organisations’ culture – entrepreneurial or ultra-risk averse
3 Be Scalable.  Does the model work if revenues are considerably (x 10?) larger than you forecast? 
4 Recognise and factor in Risk.  What happens if the stock market crashes, or your market is smaller (or larger) than expected, or the product/service doesn’t work?
5 Segment your Market by customer types, and
6 Align Products/Services with market segments; what customer need is the product/service fulfilling?
7 Minimise Costs.  Goes without saying, but look for ways to reduce costs by outsourcing, reducing overheads etc.
8 Optimise Revenue.  Also self-evident, but the approach can have a huge impact: sell a lot of widgets at low price, or a few at a very high price.  Companies like Metro that give products away can make very high revenues
9 Out distance the Competition.  In today’s market competition is a way of life, so you should give some thought to how you will compete: on price, quality, or service?
10 Be Resilient – You don’t need a B-school “sustainable competitive advantage”, but you will need to survive.  How?

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