dt 7 Mastering Disruptive business Models chapter 7

11 flashcards · Programming Languages · by Daniel F.

1. Business disruption

   happens when an existing industry faces a challenger that offers far greater value to the customer in a way that existing firms cannot compete with directly

2. Joseph Schumpeter “creative destruction”

   capitalism inherently destroys old industries and economic systems in the process of innovating new ones

3. Business Model theory of Disruption

   The best lens through which to view disruption is business models

4. 2 Sides of a Business Model

   First side – value proposition – the value that a business offers to the customer. Second side – value network – the people, partners, assets, and processes that enable the business to create, deliver, and earn value from the value proposition

5. 2 Differentials of Business Model Disruption

   to disrupt an existing business, a challenger must possess a significant differential on each side of the business model better value proposition better value network both are needed

6. Value Proposition Differential

   Price: same product lower price Free of "freemium" offer Access: ability to access content or services remotely, anywhere, any time. Simplicity: many digital business models disrupt by removing friction from the sales process, making decisions, purchase and enjoyment of a product much simpler and easier. Personalization Aggregation: many platform business models add value by aggregating many sellers for the customer to choose from. Unbundling: splitting apart traditional bundles — groups of pro…

7. Value Network Differential

   Customers: the challenger may be pursuing different customer segments or types than the incumbent currently serves. Channels: online distribution, direct delivery to customer, or distribution through intermediaries Partners: sales, manufacturing, supply chain, or other key partners what are critical to the challenger's offer. Networks: if the challenger has a platform business model, then an established network of customers or partners may be essential to how it delivers its offer. Complementar…

8. Two Differentials in Christensen’s new Market Disruption

   difference in price or access and the value network differential includes a difference in customer segment

9. Tool: The Disruptive Business Model Map

   assess whether a new challenger poses a disruptive threat to an incumbent industry or business

10. Three Variables in Business Model Disruption theory

    customer trajectory Outside-in: the distrupter first sells to non-customers of incumbent then steals customers Inside-out: distrupter sells to subsegment of incumbent. the subsegment grows to steal customers from incumbent disruptive scope the incumbent might not be 100% replaced multiple incumbents A single disruptive business model can disrupt more than one incumbent

11. Tool: The Disruptive Response Planner

    map out how a disruptive challenge will likely play out and identify your best options for a response Who's first: inside out: who as a current customer would be most attracted to the disruptive offer are there hurdles of early adoption are there customers who dont care about said hurdles outside in: whos motivated but cant afford your product what hurdles are the biggest for them what hurdle does the disrupter abolish Who is Next, and What Will Trigger Them INSIDE-OUT: subgroup of your custome…