A Simple Tool for When You Need Clarity
Have you ever applied for a loan or a grant, or otherwise been required to share highly detailed information about your business? It can be a grueling process–especially for small businesses that aren’t always sitting on an up-to-date version of their business plan.
We recently went through this process ourselves–and ultimately decided we didn’t have the necessary information for the grant. Even after pulling it all together into a 30+ page business plan a year and a half ago, things have changed enough in For the Love of Systems in the past year that we needed to rewrite a majority of the plan.
Though we decided not to apply for the grant, this experience taught us an important lesson: there is immense value in revisiting your business model.
We still plan to finish the work we started in updating our business plan, and for that work, we’re using a valuable tool we learned about through Jay Sparks of Markersqueak Consulting and participation in Startup Weekend, called the Business Model Canvas.
So what is the Business Model Canvas?
It’s a concept first introduced in the 2010 book Business Model Generation by Alexander Osterwalder. This framework provides a simple, easy-to-understand approach to creating a business model without a massive business plan.
This framework can be helpful for different scenarios, such as:
You’re starting a new business
You need to get your team on the same page about your business
You need to brief contractors/consultants about your business
You’re creating copy for your brand or marketing
The market has shifted and you need to pivot
Your expertise has shifted and you need to pivot
In fact, it not only allows you to get it all out there quickly, but it’s a great tool for moments of transition when you need to map out the different pivots you’re exploring to see which one feels the most aligned.
We love this quote from W. Edwards Demming: “If you can’t explain it as a process, you don’t know what you’re doing.”
In the same way, we ask the question: If you’re struggling to describe your business in the Business Model Canvas, do you have a clear understanding of your business?
If not, you can download a one-page version of the Business Model Canvas here. We recommend setting aside dedicated strategic time for this exercise–ideally outside of your workday, or before you jump into your daily tasks, which use a completely different area of your brain than strategic thinking.
It can also be helpful to do this type of exercise away from your office/workspace. Think: a coffee shop, a rented conference room, or even outside at a local park or green space. Really, anywhere that will get your creative, strategic juices flowing.
We hope you find the framework as helpful as we have!