PE4 Business Model Innovation

Question 1

Mckinsey 3 horizons of growth: 1

Answer 1

1-2 years: defend and expand current core business

Question 2

Mckinsey 3 horizons of growth: 2

Answer 2

3-5 years: foster emerging new businesses

Question 3

Mckinsey 3 horizons of growth: 3

Answer 3

5+ years: seed future businesses

Question 4

Red ocean efficiency innovation

Answer 4

Optimize current business model + maximise profit and margin by beating comp
Battle for every customer
Tactical improvements to customer value proposition and go to market

Question 5

Red ocean efficiency inno. METRICS

Answer 5

Customer acquisition costs
Customer lifetime value
Cost of sold goods
Product quality

Question 6

Adjacent innovation

Answer 6

Sustaining innovation
Tweak business model and grow business by offering new value proppsitions to new target group based on new innovation thesis
Manage innovation framework
Challenge: cross the chasm

Question 7

Adjacent innovation metrics

Answer 7

Do we solve a real pain of customer
Can we use existing channels to reach target group

Question 8

Radical or transformative innovation (blue ocean)

Answer 8

Highly risky and totally new business models
Level of uncertainty close to 100%

Question 9

Efficiency innovation

Answer 9

Exploring opportunities that improve operational aspects of existing company business models

Question 10

Sustaining innovation

Answer 10

Exploring opportunities outside of the traditional field of a company and radically changing or expanding a company’s business models

Question 11

Exploration

Answer 11

Invent patterns

Question 12

Exploitation

Answer 12

Shift patterns

Question 13

Backstage disruption

Answer 13

Resource castles
Activity differentiators
Scalers

Question 14

Profit formula disruption

Answer 14

Revenue differentiators
Cost differentiators
Margin masters

Question 15

Frontstage disruption

Answer 15

Market explorers
Channel kings
Gravity creators