Audit your Business Model
Digital technologies are transforming the way that businesses think about their competition and how they innovate digital capabilities. Taking a look at your business model in order to understand the areas of it where digital technologies are essential – even business critical – is a key part of the audit. We recommend using Osterwalder & Pigneur’s 2010 Business Model Canvas from the book Business Model Generation. It is based on the belief that all business models can be described and thought about simply, through nine building blocks, which show how a business either makes money or delivers its mission and generates income and/or value. Watch to get an overview:
The nine blocks of the Business Model Canvas have arisen out of the four basic areas of a business: customers, offer, infrastructure and financial viability. For cultural and heritage organisations, the bottom line of the Business Canvas Map can be divided into 3 to show triple bottom line accounting, favoured in the sector: economic, social, and environmental cost and value. Deconstruction of these maps will highlight changes over time, so its a great idea to create a business model canvas of your organisation as it is now. Highlight the areas where digital technologies are essential/business critical. (If you have competitors, it might be worth generating a canvas that reflects their business too, so you can compare, and see where the differences lie).
It’s a really useful tool to work through, and enables a shared understanding and language of what is an organisation’s business model – it’s been tried and tested on organisations around the world, as well as on enterprises who have undertaken The AmbITion Approach. Uist Wool created this podcast to describe how the business model canvas helped them with their journey of digital development.
Download the Business Model Canvas to use with your organisation, under the Creative Commons License. We thoroughly recommend buying the book too - its full of insight about resilient business models, case studies and other exercises.
You might want to additionally audit your digital proficiency, your digital technology, and your digital assets to see where digital technologies play a part/are business critical. You might also want to gauge where your customers and stakeholders are at digitally, to see how they respond to your current digital set-up, and what they would like to see by auditing your digital engagement. In relation to them,you might also like to consider your Value Proposition.
At this stage you might feel a bit overwhelmed! It’s normal for enterprises to get a fright at the beginning of a digital transformation journey, particularly if the organisation’s IT set up and digital developments have previously been ad hoc or piecemeal. But you know where you are at, now. The next stage of The AmbITion Approach is the uplifting and exciting part: brainstorming and thinking about where you would like to be! You will also be diagnosing what IT and digital developments you will need to implement to get to where you want to be, from where you are now.