MGMT Quiz 1

BMG: Answer one of the following two questions (4 points): The BMC text distinguishes between two broad classes of business model Cost Structures. Define each "broad class" in a sentence or two. The BMC text discusses four characteristics of "Cost Structures". List three of the four and define in a sentence.

Cost-Driven: focus on minimizing costs wherever possible. This approach aims at creating and maintaining the leanest possible Cost Structure, using low price Value Propositions, maximum automation, and extensive outsourcing. Value-Driven: Some companies are less concerned with the cost implications of a particular business model design, and instead focus on value creation. Premium Value Propositions and a high degree of personalized service usually characterize value-driven business models.

VPD: When describing "Customer Jobs", the text distinguishes between three main types of customer jobs to be done and supporting jobs. List the three types of customer jobs to be done and briefly describe in a sentence (4 points).

Functional Jobs, Social Jobs, Personal/Emotional Jobs

BMG: The "Business Model Canvas" consists of nine basic building blocks. Sketch the canvas and label each of the nine blocks. For each labeled block, describe it in a sentence or two. (9 points).

Key Partners, Key Activities, Key Resources, Value Propositions, Customer Relationships, Channels, Customer Segments, Cost Structure, Revenue Streams

VPD: When describing "Customer PAINS", the text distinguishes between three types of customer PAINS. List two of the types of customer PAINS and briefly describe each in a sentence or two (4 points).

Obstacles and Risks (undesired potential outcomes) (third is undesired outcomes, problems, and characteristics)

VPD: List the three types of "fit" discussed in the text. Specifically, for each "fit", list the "name" (e.g. foo-bar fit), the "slang" term used for each (e.g. "on-the-exam fit"). Describe the key attributes of each fit in a sentence of two. (6 points)

Problem-solution fit, product-market fit, business-market fit

VPD: Sketch and label the "Value Proposition Canvas" (hint: the "circle" and the "square"). After labeling each, please provide a few sentences describing each of the label quadrants / "pie" sections.

Square=Value Map Circle=Customer Profile

BMG: The text discusses that a business model can involve two different types of revenue streams. What are the two types?

Transaction Revenues and Recurring Revenues

Expected Gains

basic gains that we expect from a solution, even if it could work without them

Customer Segments

defines the different groups of people or organizations an enterprise aims to reach and serve

List of Products and Services

list of all the products and services a value proposition is built around

Revenue Streams

represents the cash a company generates from each Customer Segment (costs must be subtracted from revenues to create earnings)

Customer Gains

required, expected, desired, unexpected

BMG: According to Osterwalder & Pigneur, what is the definition of a "business model"? (3 points)

a business model describes the rationale of how an organization creates, delivers, and captures value

Pains

describe bad outcomes, risk, and obstacles related to customer jobs

Pain Relievers

describe how your products and services alleviate customer pains

Gain Creators

describe how your products and services create customer gains

Gains

describe the outcomes customers want to achieve or the concrete benefits they are seeking

Customer Jobs

describe what customers are trying to get done in their work and in their lives, as expressed in their own words

Customer Profile

describes a specific customer segment in your business model in a more structured and detailed way. it breaks the customer down into its jobs, pains, and gains.

Cost Structure

describes all costs incurred to operate a business model

Channels

describes how a company communicates with and reaches its Customer Segments to deliver a Value Proposition

Value Proposition

describes the benefits customers can expect from your products or services

Value Proposition

describes the bundle of products and services that create value for a specific Customer Segment

Value Map

describes the features of a specific value proposition in your business model in a more structured and detailed way. it breaks your value proposition down into products and services, pain relievers, and gain creators

Key Resources

describes the most important assets required to make a business model work

Key Activities

describes the most important things a company must do to make its business model work

Key Partners

describes the network of suppliers and partners that make the business model work

Customer Relationships

describes the types of relationships a company establishes with specific Customer Segments

Unexpected gains

gains that go beyond customer expectations or desires

Desired gains

gains that go beyond what we expect but would love to have if we could

Required Gains

gains without which a solution wouldn't work

Types of Products and Services

physical/tangible, intangible, digital, financial

Transaction revenues

resulting from one-time customer payments

Recurring revenues

resulting from ongoing payments to either deliver a Value Proposition to customers or provide post-purchase customer support

Product-Market Fit

takes place when you have evidence that your products and services, pain relievers, and gain creators are actually creating customer value and getting traction in the market

Business-Market Fit

takes place when you have evidence that your value proposition can be embedded in a profitable and scalable business model

Problem-Solution Fit

takes place when—> you have evidence that customers care about certain jobs, pains, and gains and/or designed a value proposition that addresses those jobs, pains, and gains

Obstacles

things that prevent customers from even getting started with a job or that slow them down.

Risks (undesired potential outcomes)

what could go wrong and have important negative consequences.

Personal/emotional jobs

when your customer seek a specific emotional state, such as feeling good or secure

Functional Jobs

when your customers try to perform or complete a specific task or solve a specific problem

Social jobs

when your customers want to look good or gain power or status. these jobs describe how customers want to be perceived by others.

Fit

you acheive fit when customers get excited about your value proposition, which happens when you address important jobs, alleviate extreme pains, and create essential gains customers care about