Designing a New Business Model: Finding an Ordered Structure to Unlock Creativity

By: Mark W. Johnson

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Synopsis: We're all familiar with stories of visionary leaders whose brilliant insights revolutionize the market. But all of these inspiring stories can be downright depressing. No one wants to depend on something as fickle as inspiration to create a new business. And you shouldn't have to, says strategic innovation expert Mark W. Johnson. Indeed, conceiving of a truly innovative new business model does not need to be a matter of imagination and serendipity, or luck. It can be an orderly process that uses structure to unlock creativity, rather than the other way around. In this chapter, Johnson shows how the four-box framework-customer value proposition (CVP), profit formula, key resources, and key processes-can help you systematically generate the right questions and assumptions; organize and categorize them in a constructive way; and implement, test, and learn about them in the right order to create a new business model. The stories of Zara and Threadless illustrate how companies have used these four pillars to transform their industries. This chapter was originally published as Chapter 6 of "Seizing the White Space: Business Model Innovation for Growth and Renewal."