business model canvas course

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Value Creation and the Business Model Canvas Cornell Course

Course overview.

In this course, you will conduct a five-step value creation analysis using the Business Model Canvas for a product or service idea. In conjunction with this analysis, you will evaluate your idea based on your competition and your unique value proposition. You will then craft a concise statement of why your idea will work. Finally, you will gather feedback from your peers and professionals in the industry to determine where you need to iterate your product or service idea. By the end of this course, you will have a validated Business Model Canvas for your concept.

You are required to have completed the following courses or have equivalent experience before taking this course:

• Preparing for Digital Transformation
• Rapid Ideation
• Generating Opportunities for Digital Disruption
• Developing and Pitching Ideas

Key Course Takeaways

• Conduct a thorough analysis of the value your business idea can create
• Collect feedback on your idea from peers and experts
• Iterate the components of your product or service idea

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How it works, course author.

• Certificates Authored

Karan Girotra is the Charles H Dyson Family Professor of Management and Professor of Operations, Technology, and Innovation at Cornell-Tech and the Johnson College of Business at Cornell University. Professor Girotra’s recent research and teaching is focused on the promise and perils of technology—how technology can improve how we do things, enable new business models, favor new leadership styles, and at the same time lead to several excesses and unaccounted negative externalities. He has also studied business models and market-based solutions to reduce carbon emissions, global supply chains, and online retail.

Professor Girotra was the first business faculty at Cornell Tech and now leads Cornell Tech’s flagship studio-based education programs. He also leads the design and delivery of our executive education offerings and works closely with leaders in industry.

Professor Girotra and his research collaborators have been recognized with multiple best paper awards and his research contributions were recognized with the prestigious Wickham Skinner Early Career Research Award. His research on new business models (at the time) was summarized in the best-selling book, “The Risk Driven Business Model”. He has also won over 25 teaching awards for his teaching on entrepreneurship and new business models and was featured in the Poets and Quant’s Best 40 under 40 business professors lists.

In addition to his academic work, Professor Girotra was one of the founders of TerraPass Inc., which the New York Times identified as one of the most noteworthy ideas of 2005. Since then, TerraPass has helped businesses and individuals reduce over a hundred million tons of carbon dioxide emissions. Prior to Cornell Tech, Professor Girotra held the Paul Dubrule Sustainability Chair at INSEAD, earned a doctorate at the Wharton School, and a bachelor’s degree from Indian Institute of Technology, Delhi.

• Omnichannel Leadership Program
• Digital Transformation
• Digital Leadership

Who Should Enroll

• Business leaders
• Technology leaders including CTOs
• Entrepreneurs

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The Business Model Canvas

The Business Model Canvas is a strategic management and entrepreneurial tool. It allows you to describe, design, challenge, invent, and pivot your business model. This method from the bestselling management book Business Model Generation is applied in leading organizations and start-ups worldwide.

The Business Model Canvas enables you to:

• Visualize and communicate a simple story of your existing business model.
• Use the canvas to design new business models, whether you are a start-up or an existing businessManage a portfolio of business models
• You can use the canvas to easily juggle between "Explore" and "Exploit" business models.

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Mastering business models

A self-paced online course with 
Alex Osterwalder and Yves Pigneur.

Are you trying to improve your existing business model? Or trying to create a new one that can compete in today’s market?

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The Business Model Canvas

What is the business model canvas.

The business model canvas is a tool designers use to map out a business or product’s key actors, activities and resources, the value proposition for target customers, customer relationships, channels involved and financial matters. It gives an overview to help identify requirements to deliver the service and more.

“A business model describes the rationale of how an organization creates, delivers, and captures value.” — Alexander Osterwalder, Co-creator of the Business Model Canvas  

Learn about the business model canvas and how it helps in design.

• Transcript loading...

The Business Model Canvas – Flexible Chart, Early-Warning System and More 

In service design , two tools are essential to use early in your design process: the business model canvas and the value proposition canvas . You can use the business model canvas to build an overview of changes to be made to an existing business (e.g., a merger) or of a totally new business opportunity or market gap . At the start of your design process, it’s vital to map out the business model of your service to see how it will fit into the marketplace. You’ll also need to ensure what you propose can bring maximum value to both your customers and business, and keep doing so in terms of customer retention, profitability and more.

To gain the most accurate vision of a proposed product or service, it’s essential to understand all the components and dynamics of not only the customer experience but also the service as a whole ecosystem . This ecosystem contains all the channels and touchpoints that must work together to deliver and sustain maximum value to the customer.

This canvas gives you several important advantages, namely these:

It’s collaborative – so you can bring the various partners together on the same page to generate and analyze ideas, and have an early testing ground for concepts before you advance to service staging a prototype.

It’s human-centered – so you can keep close track on how to create and maximize value for customers as well as stakeholders and other partners.

It makes it easier to collect rich data – if you have a clear purpose and strategy in mind. 

A business model canvas typically contains 10 boxes:

Key Partners – The people who will help you fulfill the key activities, using the key resources. 

Key Activities – Those vital actions that go into the everyday business to get things done; these are all the activities needed to realize and maintain the value proposition, and to power everything else involved.

Key Resources – The tools needed to get those things done, stretching across all areas the canvas covers to include, for example, customer retention.

Value Proposition – The item you think will create value for your customer: e.g., a new idea, a price drop. This is a summary of what your business will deliver to customers, and feeds into the value proposition canvas, the tool you’ll use to expand this.

Customer Relationships – Where you envision the relationship each customer segment expects: e.g., customer acquisition, retention and upselling (i.e., How do you get customers? How do you keep customers? How do you continue to create value for them?).

(Note: boxes 5 and 4 are closely linked as everything you do revolves around retaining the customer and considering the customer lifecycle.)

Customer Segments – Your most important customers (e.g., seniors); consider the value of personas here.

Channels – How you deliver the value proposition. Will it be online, through physical means or a combination? Here, you identify which channels are the best (both desirable for customers as well as cost-efficient and cost-effective for the brand).

Cost Structure – Here you find the most essential cost drivers. This allows you to consider the return on investment (ROI).

Revenue Streams – Where you find potential revenue sources (e.g., advertising). 

Sustainability – How sustainable your offering is overall, to the environment, to the social good, etc.

© Strategyzer AG, modified, CC-BY-SA-3.0

How to Build a Business Model Canvas

For the best results, follow these guidelines and aim to fill in all the gaps, looking out for cause-and-effect relationships that run between boxes/throughout:

Complete the top seven boxes (Key Partners to Customer Segments) – using all the information you can gather from your research.

Complete the next boxes:  

Cost Structure – Determine the cost drivers from the Key Partners, Activities and Resources boxes; and

Revenue Streams – Determine these from the Customer Relationships, Customer Segments and Channels boxes.

Once you have established these, you can work to estimate them in monetary terms.

Complete the Sustainability box – according to the insights you’ve found.  

Here’s an example of a business model canvas as a work in progress:

© Interaction Design Foundation, CC BY-NC-SA 3.0

Overall, remember your canvas is a flexible tool. It’s also a living document that you can revisit and use to find the most effective alternatives. With a clear sense of goals, a keen eye for detail and ear for input, and a readiness to refine this canvas, you can use it to fine-tune the best service prototype every time.

Learn More about The Business Model Canvas

Take our Service Design course , featuring a template for service blueprints.

Read this example-rich piece by experienced strategy designer Justin Lokitz for tips on using the business model canvas .

Find some additional tips on how to make the most of your business model canvas here .

Literature on the Business Model Canvas

Here’s the entire UX literature on the Business Model Canvas by the Interaction Design Foundation, collated in one place:

Learn more about the Business Model Canvas

Take a deep dive into Business Model Canvas with our course Service Design: How to Design Integrated Service Experiences .

Services are everywhere! When you get a new passport, order a pizza or make a reservation on AirBnB, you're engaging with services. How those services are designed is crucial to whether they provide a pleasant experience or an exasperating one. The experience of a service is essential to its success or failure no matter if your goal is to gain and retain customers for your app or to design an efficient waiting system for a doctor’s office.

In a service design process, you use an in-depth understanding of the business and its customers to ensure that all the touchpoints of your service are perfect and, just as importantly, that your organization can deliver a great service experience every time . It’s not just about designing the customer interactions; you also need to design the entire ecosystem surrounding those interactions.

In this course, you’ll learn how to go through a robust service design process and which methods to use at each step along the way. You’ll also learn how to create a service design culture in your organization and set up a service design team . We’ll provide you with lots of case studies to learn from as well as interviews with top designers in the field. For each practical method, you’ll get downloadable templates that guide you on how to use the methods in your own work.

This course contains a series of practical exercises that build on one another to create a complete service design project . The exercises are optional, but you’ll get invaluable hands-on experience with the methods you encounter in this course if you complete them, because they will teach you to take your first steps as a service designer. What’s equally important is that you can use your work as a case study for your portfolio to showcase your abilities to future employers! A portfolio is essential if you want to step into or move ahead in a career in service design.

Your primary instructor in the course is Frank Spillers . Frank is CXO of award-winning design agency Experience Dynamics and a service design expert who has consulted with companies all over the world. Much of the written learning material also comes from John Zimmerman and Jodi Forlizzi , both Professors in Human-Computer Interaction at Carnegie Mellon University and highly influential in establishing design research as we know it today.

You’ll earn a verifiable and industry-trusted Course Certificate once you complete the course. You can highlight it on your resume, CV, LinkedIn profile or on your website.

All open-source articles on the Business Model Canvas

Service design - design is not just for products.

The Relationship Between Visual Design and User Experience Design

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If you want this to change , cite this page , link to us, or join us to help democratize design knowledge!

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Simply copy and paste the text below into your bibliographic reference list, onto your blog, or anywhere else. You can also just hyperlink to this page.

New to UX Design? We’re Giving You a Free ebook!

Download our free ebook The Basics of User Experience Design to learn about core concepts of UX design.

In 9 chapters, we’ll cover: conducting user interviews, design thinking, interaction design, mobile UX design, usability, UX research, and many more!

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Denis Oakley & Co

I HELP BOLD LEADERS TRANSFORM THEIR BUSINESSES AND THE INDUSTRIES THEY COMPETE IN

February 10, 2018 By Denis Oakley

A Free Business Model Canvas Course

Do you have an idea for a business? Do you need to change the way your business works? You have come to the right place. This short business model canvas course is all about how you design and change your business model. We use the business model canvas developed by Alexander Osterwalder as a place to play with ideas and to figure out what is going to be the best way to turn your idea into reality.

What is a Business Model Canvas

A business model canvas is a tool for planning and managing your business. On a single sheet of paper, you can show everything that really matters. If you have too much blank space – there are areas that you haven’t thought enough about. If it is too full you probably need to simplify things. That may mean finding better ways to express yourself. It may mean splitting your business into one or more parts.

The business model canvas helps you to do all this.

If you want to create a great business model canvas you also need to think about far more than what you will actually do. You also need to think about the business models of your competitors. How do you stack up against them? What are the key drivers of your business, the aspects of it that will accelerate your success? What are the parts that slow you down?

This course helps you transform your idea with practical steps.

Download Your Business Model Canvas Template Here

Download Link

The Business Model Canvas Course

In 9 lessons we walk you through the key components of any startup or small business. We explain how the different parts of a business relate to each other. We show you how you can use these insights for your profit and success. The result is that you will have built a clear business model based on the Business Model Canvas.

These lessons help you cover and understand the key parts of any business

• Customers – The people who have a problem and will pay you to solve it
• Value – the solution that you provide to customers
• Relationships – how you interact with customers
• Distribution – how you distribute your solution to customers
• Activities – what you need to do to create and deliver your solution
• Resources – And what you need in order to make it happen
• Partners – The people who you beg, borrow, rent or buy resources from
• Costs – the cost of providing the solution
• Revenue – and the money you get for providing it.

Using this you will be able to: –

• quickly and clearly explain your business idea
• identify the areas where you will need to spend a lot of effort
• be clear about what value you are offering to customers
• understand your cost basis
• Know where your revenue will come from
• know who you will need to persuade to get it to work without lots of cash

The course will take about 3 hours to go through over a weekend. The videos are quite quick to watch. The thinking that you have to do will be slower. The result is to help you avoid lots of problems and roadblocks.

Who is the Business Model Canvas Course for?

When I recorded this business model canvas course originally we did it for first-time entrepreneurs. We did it for people who had an idea but didn’t know what the next step was. With a lot more experience we now know that almost anyone starting, managing or running a business benefits from understanding the business model. The better you understand a company’s business model the easier it is to help it perform. You know what is important and what is not.

So a shortlist of people who benefit from creating and owning a business model canvas includes

• Founders and Co-Founders
• Entrepreneurs
• Presidents and Vice Presidents
• Board Members
• Early Employees

If you understand the business you can make the business go faster and further.

Enjoy the Free Business Model Canvas Course

You can watch and read all the lessons by clicking on the links below or you can watch them all on my YouTube channel 

• Introduction 
• Value Propositions
• Marketing & Distribution Channels
• Customer Relationships
• Key Resources
• Key Activities
• Key Partners & Suppliers

Ready to start?

I help entrepreneurs transform their industries through wiser choices

Outcome : More Traction, Bigger Rounds, Better Products

Method : Problems, Customers, Business Models, Strategy

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Business Model Canvas

Taught in English

Instructor: Shalini Gopalkrishnan

1,572 already enrolled

Guided Project

Recommended experience.

Intermediate level

Have an workable idea for a business

(30 reviews)

What you'll learn

Identify Your Value Proposition

Identify Your Customers

Understand Your Costs and Revenue Streams

Skills you'll practice

• Business Plan
• Ideas for business

Details to know

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About this Guided Project

In this project, we will teach you how to create a Business model canvas which will help you refine the strategy for your startup or idea. It will help you understand how your idea adds value and delivers it.

This project will help you think clearly about the various aspects of your startup or idea and delineate the various aspects of running a business . It will help you think about who your target customers are, where you will make money from , what is your cost structure, who are your key partners and what resources you nee dto run your startup. This is useful for people who have an idea or a startup . Note: This course works best for learners who are based in the North America region. We’re currently working on providing the same experience in other regions.

Learn step-by-step

In a video that plays in a split-screen with your work area, your instructor will walk you through these steps:

Identify your Value proposition

Identify your customers

Revenue Streams and Channels

Key Resources and Activities

Cost Structure and Partners

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How you'll learn

Skill-based, hands-on learning

Practice new skills by completing job-related tasks.

Expert guidance

Follow along with pre-recorded videos from experts using a unique side-by-side interface.

No downloads or installation required

Access the tools and resources you need in a pre-configured cloud workspace.

Available only on desktop

This Guided Project is designed for laptops or desktop computers with a reliable Internet connection, not mobile devices.

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What will i get if i purchase a guided project.

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The 9-Step Business Model Canvas Explained (2023 Update)

Written by Raquel Alberdi

Business | entrepreneurship, 13 comments(s).

Blog » The 9-Step Business Model Canvas Explained (2023 Update)

“A major mistake made by many start-ups around the world is focusing on the technology, the software, the product, and the design, but neglecting to ever figure out the business . And by “business” we simply mean how the company makes money by acquiring and serving its customers”.

-Reid Hoffman

After meeting with hundreds of entrepreneurs and business owners over the years I believe the LinkedIn co-founder and Blitzscaling author Reid Hoffman’s got it spot on.

People tend to focus on specific parts of their business, such as which software packages are being used, which is the cheapest supplier, how to optimize internal processes…?

They get so bogged down in the details of the day-to-day running that they lose the overall vision of their business.

Without this vision they are unable to scale, they make marginal profits, miss opportunities, struggle to innovate, and end up running “just another” business.

Another handy metaphor in understanding this common mistake is the soldier in the trenches .

Every meter of ground gained comes at a heavy cost, mistakes are made, and progress is hard-fought and slow…a day-to-day experience for 99% of entrepreneurs and businessmen.

But when you do have that 360 vision you see the entire battlefield. Decisions are much clearer, fewer mistakes are made, and progress is fast and methodical.

Fortunately, a business model framework exists that gives you both vision and clarity .

The Business Model Canvas provides entrepreneurs, business owners, and strategists with a tool to analyze, structure, and evolve a business while always keeping the bigger picture front of mind.

So let’s take a closer look at how it works.

Table of Content

What is the Business Model Canvas?

Created by Swiss entrepreneur and Strategyzer co-founder, Alexander Osterwalder, the Business Model Canvas is a visual representation of the 9 key building blocks that form the foundations of every successful business. It’s a blueprint to help entrepreneurs invent, design, and build models with a more systematic approach.

Why is it so popular within the business community?

Its simplicity. The business model canvas allows us to carry out a high-level analysis without drilling down and getting lost in the details. You just draw out the 9 building blocks on a blank canvas, fill them in as each concept relates to your business, and hang it somewhere everybody can see.

It’s a visual overview of your entire business on a single canvas.

While the Business Model Canvas is an extremely fluid concept and hyper-specific to individual companies, each canvas is still broken down into these 9 key building blocks:

Customer Segments

Value propositions, customer relationships, revenue streams, key resources, key activities, key partners.

When laid out on the canvas the model will look something like this:

While you’ve probably come across each of the 9 building blocks before, the attractiveness of the Business Model Canvas is that it confines them to a single page , not a traditional 42-page document.

This makes it a lot easier to digest, as well as assess existing business models or map out new ideas.

How do I fill out the Business Model Canvas?

To start your Business Model Canvas you will need to breakdown and analyze each of the 9 building blocks.

A good way to approach this is to gather the heads from marketing, sales, operations, finance, and manufacturing (if product-based) and pencil-in a morning where you can all meet together.

Then, after drawing a mock canvas onto a whiteboard, proceed to dissect and discuss each of the 9 building blocks as they relate to your business. You can use sticky notes to better organize your thoughts around the canvas.

If you are an entrepreneur or new business owner working alone and don’t have a team to bounce your ideas off, not to worry. You can still carry out your analysis before sharing it with a like-minded entrepreneurial community or forum, like those found on ThePowerMBA , to get useful, insightful feedback.

Whichever way you decide to approach it, I recommend you complete each block in the following order:

• Cost structure

For continuity, I’m going to use the fashion retail giant Zara when analyzing each of the 9 key building blocks.

If you’d like to skip to another case study similar to your own business, navigate to the table of contents at the top of the page and select one of the other business model canvas examples.

The first block of the Business Canvas Model is about understanding who is the most important customer(s) you’re delivering value to. Or, in other words, who are they? What do they do? And why would they buy your product or service?

Not a single company exists without its clients, making customer segments the best block to start with while drawing out your business model canvas.

A great exercise to define your customer segments is to brainstorm and create your company’s buyer persona (s) .

Buyer personas are fictional depictions of an ideal or hypothetical client. Typically when brainstorming a buyer persona you’d want to define certain characteristics (age, demographic, gender, income, industry, pain points, goals, etc.)

However, remember at this stage we want a snapshot of our customer segment. There’s no need to jump into great detail just yet.

In the case of Zara, there are three distinct customer segments to whom they offer different products.

The products created for each of these customer segments (clothing, shoes, and accessories) are not trans-consumable. That is to say, a woman’s dress is highly unlikely to be worn by a 7-year-old child.

Once we know exactly who it is we are targeting, it’s time to look at what we as a company have to offer.

The second phase is about figuring out your company’s value propositions , and importantly, your UVP (unique value proposition). The “what” that makes customers turn to you, over your competitors? Which of their problems are you best at solving?

Each value proposition consists of a bundle of products or services that fulfill the needs of a buyer persona from your customer segment. It’s the intersection between what your company offers, and the reason or impulse customers have for purchasing.

Some popular questions to ask while determining your UVP are:

• Which specific customer pain point are you trying to solve?
• What job are you helping customers get done?
• How does your UVP eliminate customer pain points?
• What products or services do you provide that answer this specific pain point?

So let’s try and apply this to Zara. Why do people choose to purchase from them, over their competitors?

Zara’s principal value propositions are fairly clear. They offer various ranges of stylish men’s, women’s, and children’s clothing and accessories at an affordable price.

But there’s more to it than that.

If we dive a little deeper we see Zara’s value propositions are more complex, which are behind the success of the brand:

Fast fashion

Zara adds new clothes and designs to its collections every 2-3 weeks, both in its stores and online. It keeps the brand updated, fresh, and modern while maintaining its all-important medium price point

Great eCommerce experience

Once you enter Zara’s online store you’re presented with a clean, easy-to-navigate, and high-end feel. The customer segments are visible on the left navigation bar with a search tab to further aid customers with their online experience.

Localized stores

You can find a store in nearly all major retail locations (shopping malls, retail outlets, airports, etc.) meaning accessibility is not an issue for the majority of consumers.

Flagship stores

Zara demonstrates its aesthetic evolution to customers through its flagship stores. The recent opening of their Hudson Yards , New York City flagship is a great example of this. Customers shop around its vivid, minimalist layout offering them an experience aligned with the brand’s deeper, eco-friendly values.

Zara Hudson Yards, New York

The next step is to ask yourself how you are reaching your customers, and through which channels ?

This includes both the channels that customers want to communicate with you as well as how they’ll receive your products or services.

Is it going to be a physical channel? (store, field sales representatives, etc.) Or is it a digital channel? (mobile, web, cloud, etc.).

Zara has 3 primary channels in which they communicate and deliver products to its customers:

• Direct sales through their stores
• Online (both app and website)
• Social media

Customers can go to a traditional “bricks and mortar” store to browse, model, and purchase different items of clothing at one of their retail stores.

Alternatively, they can shop online or through their mobile application and have the product delivered straight to their door or nearest store. The choice is completely up to them!

So that covers Zara’s commercial channels, but what about how they communicate with customers?

While they do communicate through their mobile app, their predominant channel is social media.

What’s more, they’re really, really good at it.

For example, did you know that Zara invests less than 0.3% of its sales revenue into advertising?

This is only possible due to an A-rated social media presence . Customer queries are not only dealt with quickly, but recommended re-works are sent back to HQ, forwarded onto in-house designers who then apply the feedback to future collections.

This customer-first approach through fluid communication channels has saved them thousands of dollars in marketing, strengthened their brand, and created a loyal customer base.

You should only step away from this building block once you’ve decided how each of your customer segments want to be reached.

Once you have acquired customers, you will need to think about how you can build , nurture, and grow those relationships.

Now, this can be automated and transactional like large eCommerce brands Amazon or Alibaba. Or, it could be at the complete opposite end of the scale and require a more personal relationship you’d typically have with a bank or your local bike shop.

Zara’s relationship with its customers is threefold, and lies somewhere in the middle of transactional and personal:

• Salesperson at store
• Brand through social media
• Sentimental attachment to a product

Yes, you have the initial transactional touchpoint at the store or online, something relatively impersonal and for many the only interaction they’ll have with the brand.

However, customers (especially in the fashion industry) are encouraged to continue to interact with a brand through social media platforms.

As we mentioned before when discussing channels, Zara has a very effective communication system in place. Not only can people instantly get in touch with the brand, but also engage with new posts, images, and collections uploaded to social media.

This personal approach to customer relationship building can, in some cases, lead to the natural growth of brand ambassadors and communities .

An attachment can also develop between customers and particular garments or accessories from one of their collections. The sentimental attachment to these products also creates another potential form of brand loyalty.

Now that you’ve described how you are going to create real value for your customers, it’s time to look at how you plan to capture that value.

What are your revenue streams? Is it going to be a transactional, direct sales strategy ? Are you going to consider a freemium mode l, where you give a portion of your product or service away for free with the idea of converting later on down the line?

If you’re a SaaS company such as SalesForce or Strava , then it’s likely that a licensing or subscription revenue model will be more appropriate.

At Zara, it’s extremely simple. They make their money by selling clothes and accessories either at a store or online.

As you can see, we’ve filled in the entire right-hand side of our business model canvas. We touched upon:

Customer segments

• Value propositions
• Revenue streams
• Distribution channels

Now it’s time to move over to the left side of the business canvas model and look at what we need, internally , to deliver our value propositions.

To start with, let’s take a look at key resources.

The key resources are all things you need to have, or the assets required to create that value for customers.

This could be anything from intellectual property (patents, trademarks, copyrights, etc.) to physical holdings (factories, offices, delivery vans, etc.) right down to finances (the initial cash flow perhaps needed to start your brand).

Another key resource every company needs to consider is its human capital . Are you going to need highly specialized software engineers? Or field-based sales teams?

They are relatively capital-heavy resources that need to be factored into your business model.

In the case of Zara, they are going to need a number of key resources if they hope to deliver their propositions:

• Stock management
• A large, interconnected network of physical stores
• A strong brand
• Logistics and supply chain infrastructure

Stock is vital for both online and offline customers.

If they are unable to supply their range of products and meet customer demands, satisfaction levels fall and they have a serious problem on their hands.

A large distribution network of brick and mortar stores combined with a strong brand name help mitigate these factors, as well as reinforce any ongoing marketing activities and communication efforts.

Finally, an efficient logistics process within Zara is critical, especially when you consider the complexities involved with such a large-scale operation.

They will require the necessary technology to analyze data on inventory, storage, materials, production, and packaging, with the staff to execute each of these stages and manage the delivery of the final products.

The next step is to define the key activities – the areas you need to be good at to create value for your customers.

To mix it up a little let’s take a look at a slightly different business in Uber .

Their key activities can be broken down into:

• Web and mobile app development
• Driver recruitment
• Marketing: customer acquisition
• Customer service activities : drivers’ ratings, incidents, etc.

They need a fast, clean UX for their customers using the app, drivers to carry out their service, and the ability to both market the product and deal with any customer queries.

Zara’s key activities will differ to those of Uber. Some of the things they need to consider would be:

• Manufacturing
• Retail process (point of sale and 3rd party management)
• Distribution channel / logistics

Design is a key activity as Zara’s value proposition is to provide stylish garments at an affordable price. Their collections need to be constantly updated to follow the latest fashion trends at the time.

To produce their collections Zara will also require manufacturing capabilities. Now Zara doesn’t own their own factories (we will get to that in the Key Partners section) but they still need to be involved in the garment manufacturing process.

Everything from fabric selection to pattern making, to detailing and dyeing affects the outcome of the final product which of course they have to then go on and sell.

The effective management of the retail and distribution channels (online, offline, shipping, and communication with providers) is also key. A breakdown in either of these activities, such as a poor relationship with an important provider will have serious consequences for the business.

Most modern business models now require brands to build out and work with various key partners to fully leverage their business model.

This includes partnerships such as joint ventures and non-equity strategic alliances as well as typical relationships with buyers, suppliers, and producers.

A great example of a strategic partnership would be between ThePowerMBA and Forbes . In exchange for exposure of our brand to the magazine’s global audience, we provide expertise and content on high-level business education programs.

As we touched upon when discussing key activities , Zara requires strategic partnerships with many different providers if they are to design and produce their collections.

Another key partner is their major holding company, Inditex .

Inditex has several subsidiaries including Massimo Dutti , Pull & Bear , and Oysho . Being a subsidiary of Inditex means they share a consolidated balance sheet, stakeholders, management and control, and various legal responsibilities.

While as a subsidiary Zara is afforded certain freedoms when it comes to design, delivery, and the general running of the company, the overall strategy will need to be aligned with Inditex and its other subsidiaries.

The final step of the Business Model Canvas is to ask yourself, how much is it going to cost to run this model?

This includes some of the more obvious needs such as manufacturing costs, physical space, rent, payroll, but also areas such as marketing activities.

If you are unsure of exactly what to include in your cost structure take a look at a Profit and Loss statement ( P&L ) from a competitor or company in a similar industry to yours. You’ll find many items overlap such as research and development ( R&D ), cost of goods sold, admin expenses, operating costs, etc.

Once that’s done you should prioritize your key activities and resources and find out if they are fixed or variable costs .

As Zara is such a large, corporate business they are going to have both fixed costs (rent, payroll, point of sales personnel) and variables, such as costs associated with the fluctuating sale of goods, purchase of materials and, manufacturing costs.

Once you’ve completed these 9 steps, your Business Canvas Model should look something like this:

Business Model Canvas Examples

Hopefully, you were able to get a good feel for the effectiveness of the business model canvas with our run-through of Zara.

However, if you found it difficult to follow due to the stark difference between your industries, I’m going to quickly go through 3 more companies to demonstrate the tool’s flexibility:

• Netflix (Media service/production)
• Vintae (Vineyard)

Even if these business model canvas examples don’t align exactly with your industry, I honestly believe that studying different models gives you a competitive advantage in your professional career regardless.

If you’re currently employed by a company, you’ll better understand how your specific role helps the company achieve some of its “long-term” goals.

Alternatively, if you are a business owner yourself (or perhaps thinking of starting your own business) you’ll have a better understanding of your business and where potential opportunities lay.

I’m sure you’re familiar with our next business model canvas example candidate, Netflix .

The global media company offers an online streaming service of various movies, documentaries, and TV programs produced in-house or licensed 3rd-party content. Their success sparked a revolution in the online media world with the likes of Amazon, Apple, Disney, HBO, and Hulu all rushing to launch their own online video streaming platforms.

Netflix started life as an online DVD rental company, basically a web version of the more popular (at least at that time) “bricks and mortar” Blockbuster.

Co-founder Reed Hastings predicted as far back as 1999 that the future of media was in online streaming, saying “postage rates were going to keep going up and the internet was going to get twice as fast at half the price every 18 months.”

It wouldn’t be until 2007 that Hasting’s prediction would become true when Netflix, as we now know it, was born.

So let’s take a current look at their business model canvas:

As you probably know, there are very few people out there who haven’t subscribed, watched, or at least heard of Netflix. There is content for everybody: wildlife documentaries, sci-fi movies, rom coms, action-thrillers, you name it – it’s there.

That’s why their customer segment can be classified as a “ mass market ” as the base is just so diverse.

All people require is a computer, TV, internet, and/or smartphone and they’re good to go. For most developed markets, that covers just about everybody.

Value Proposition

Whether on the train to work, sitting in the car (if you’re not driving!), or relaxing at home in front of the TV, you can consume their online, on-demand video streaming service.

They also have a huge library of content for consumers to choose from, ensuring that people keep coming back, as well as increasing their mass-market appeal.

They also produce high-quality, original content to differentiate themselves from their competitors.

Most people access Netflix either through their website or mobile/TV App . Another popular channel that you may have picked up on is their affiliate partners .

You’ve perhaps signed up for a mobile, TV, and internet package where the provider offers Netflix as an extra to sweeten the deal, so to speak.

That would be an example of an affiliate partnership between Netflix and mobile service providers.

I doubt many consumers have had direct contact with Netflix unless it’s to resolve a subscription issue or general query. It’s very much a self-automated service – you download the app, select the program you wish to watch, and hit play.

Very simple, very effective.

Again, this doesn’t need much embellishment. Netflix generates money from the different tiers and packages put together in their subscription services.

This varies depending on the region to account for local markets, but on the whole, it’s sold at a low price point.

Originally, Netflix’s Key Resources would have been their unrivaled DVD collection combined with a cost-effective mail-order system.

Nowadays it’s undoubtedly the rights to stream online video content. Netflix has brokered deals with some of the biggest production studios worldwide.

Combined with their huge library of in-house productions , it’s more than enough to encourage customers to renew their subscriptions.

To help sustain interest in their product, Netflix understands they need to serve-up relevant content for each sub-sector of their mass audience. Therefore their machine learning algorithm selects content for consumers based on streaming habits (what they watched, at what time, etc,.) to personalize the customer experience.

This explains why over 80% of all content streamed on Netflix was cherry-picked by this algorithm, making it a Key Resource for their business model.

Also, Netflix accounts for a whopping 12.6% of global bandwidth usage . The literal capacity to stream their services must be met meaning bandwidth must also be included here.

Content procurement is arguably their biggest Key Activity. They need to find people to produce and deliver their original content, including actors, studios, writers, etc. as well as secure the licensing and streaming rights from 3rd party producers such as Sony, Warner Bros, and Disney.

Finally, they need a fast, easy-to-use application to host their online streaming service. This needs to be available for both TV and mobile devices if they are to deliver their “on-demand” value proposition.

K ey Partners

Seeing as Netflix’s entire business model is largely based around streaming 3rd party content, key partnerships need to be built with production studios . No content, no Netflix!

Also, as we touched upon earlier Netflix is one of the largest consumers of bandwidth worldwide. If the speed and delivery of their streaming service are to be continued then deals will also need to be made with internet service providers (ISPs).

Netflix’s biggest expenditures come from both their in-house content procurement and 3rd party licensing agreements . The high-quality standard of video streamed on Netflix is only possible due to the speed and performance of its online platform and application , which has additional costs of staff, software, etc.

To show you just how flexible the business model canvas can be, I wanted to throw in a slightly leftfield example. Vintae is a Spanish wine producer who, after a detailed analysis of the business model canvas, was able to innovate and disrupt one of the world’s most competitive industries.

As some of you may know, the wine industry is extremely competitive. It’s also steeped in history and tradition , making it very challenging for newcomers to grab market share, let alone think about year-on-year growth and revenue.

However, CEO “Richi” Arambarri looked at the traditional “ bodega ” business model and saw a chink in its armor.

A “small” innovation in the business canvas model helped them to become one of the region’s most important winery groups, with over 10 installations and a presence across all regional denominations (Rioja, Priorat, Rias Baixas, etc.) with year on year growth of 30% – practically unheard of in such a competitive industry.

So how did Vintae analyze the business model canvas to find a niche in their market?

To answer that question, we must first look at the traditional winery business model .

As you can see, the wine industry has historically been patrimonial. Vineyards and estates are passed down through generations with the winery responsible for all phases of production, clarification, and distribution.

The traditional winery business canvas model suggests you must be the owner of the winery/vineyard where the wine is “manufactured”, meaning physical assets are a key resource of the business model.

So, if you wanted to start producing a Rioja, for example, you’d have to set up your vineyard in the region.

This is monumentally expensive as you need to:

• Purchase the land
• Plant a vineyard
• Absorb set-up and installation costs
• Deal with maintenance costs

It’s here where Vintae saw their opportunity.

What if we move vineyard ownership across the business model canvas from key resources to key partners ?

By leasing the equipment and space of large wineries (of which there was plenty), they could still produce their wine but reduce the cost and exposure associated with land purchase, crushing equipment, huge storage tanks, vineyard maintenance, and their bottling line.

This enabled them to focus on their sales, marketing, and distribution channels to create a better brand experience for their customers.

Also, it afforded them more flexibility when creating new wines as they were no longer confined to the limitations of grapes grown on their vineyard.

The lightness of this new business model eliminates maintenance overheads, channels energy into personalizing the customer experience, and allows for unprecedented levels of growth in one of the world’s most competitive industries.

Business Model Canvas Software

Although I did mention starting with a large whiteboard, sticky notes, and a pack of colorful sharpies there are several options in which you can digitize the business canvas model production process.

While I still believe the aforementioned process is extremely valuable (it gets your entire team’s input in a single hour-long session) you may decide it more viable for each member of management to pool their ideas digitally before sharing with the rest of the group.

If that’s the case, then take a look at some of the following software tools for creating your business model canvas.

Strategyzer

Created by the founders of the business model canvas Alex Osterwalder and Yves Pigneur , Strategyzer offers a range of business model canvas templates for you to get started with.

If you opt for the paid model (there is a 30-day free trial period) they offer a series of various classes that teach you how to build and test different value propositions and business models.

A real-time built-in cost estimator analyzes the financial viability of some of your business ideas, identifying alternative areas you may wish to explore with your model.

All-in-all, it’s a great resource to play around with and test some of your business ideas, with the option to dive into further detail if you see fit.

Canvanizer is a free, easy-to-use web tool that allows you to share links between team members who are brainstorming ideas for a business model canvas, but working remotely.

Like Strategyzer, there are several business model canvas templates provided to help you get started with your analysis. The strength of this platform is its accessibility. Much like a Google Doc., several people can brainstorm on the same canvas simultaneously with changes being synchronized automatically.

Business Model Canvas Tool

A ThePowerMBA alumni, impressed by the simplicity and effectiveness of the tool, went ahead and created the free application Business Model Canvas Tool .

It’s an incredibly intuitive, and easy-to-use tool that allows you to create templates simply by clicking the + button in each building block.

Each business model canvas created can be downloaded and shared as a pdf. with the rest of the team.

Would You Like to Learn More about Business Models?

If, after going through our 9-step guide on how to use the Business Model Canvas you’d like to learn more about different business model analysis tools , take a look at our alternative MBA business program .

As you’ll see, the course gives students a 360-degree view of business and management practices – such as engines of growth, segmentation and targeting, and value propositions.

I highly recommend you go check it out.

Regardless, I’d love to hear what you thought about this guide. Was it helpful? Would you like to see additional business cases analyzed from your industry?

Let us know in the comments below.

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13 Comments

Perfect thought

I am a DBA student. I have used your site a lot. Thank you for the information

Well defined steps, Thanks for good contents.

Dear Sir many thanks for you guideline. it was very effective for me. Thanks a Million

Well explained with practical business case

Wow, this article was incredibly helpful! I’ve heard about the Business Model Canvas before, but I wasn’t sure exactly how it worked or how to use it for my own business.

I need a sample of business model canvas for a beauty palour

you’ve done a great job. keep it up

This is a very insightful content with a step-by-step practical approach of how to write a BMC and what exactly it should contain.

My team and I literally used your guide to write a BMC for a project we were working on, and in just about an hour we were done.

Thank you so much for this content, it was really helpful.

Thank you very much Collins and we are glad you are using this tool.

Insightful! Gave me the clarity I needed for my upcoming business. Thank you so much.

Thank you very much for the business model example of ZARA. It was very very informative

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• Demystifying business model canvas – Karmen Skaro - […] Additional information on business model canvas find here and here. […]
• Saas Business Model (2023) - […] in this material you will learn all about SaaS as a business model. It’s an interesting material that will…
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• How to Prepare a Canvas Business Model - The Passionate Seeker - […] you have filled out each building block of the Business Model Canvas, you will have a comprehensive overview of…
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Business Model Canvas Template

Identify your competitive advantage, build a comprehensive visual representation of your business model and identify opportunities..

• Visualize key elements of your business model on a shared canvas
• Conduct structured brainstorming sessions with built-in tools
• Share your business model canvas, guides and documentation with stakeholders

Over 10 Million people and 1000s of teams already use Creately

Identify Unique Value Propositions

Multiple frameworks to create your business model canvas with ease.

An infinite canvas to centralize information around the key elements of your business.

Link to external documents and open them within the canvas for detailed understanding of your business model.

Bring in data from multiple sources , analyze various components of your business strategy and make informed decisions.

Customizable styling options and text formatting capabilities to highlight important points and drill down on issue.

Adaptive dynamic connectors to visualize the relationship between multiple business elements.

Drive Sustainable Business Growth

Virtual whiteboard with powerful diagramming tools to conduct structured strategic planning sessions and decision making workshops.

Brainstorming tools like mind maps, SWOT diagrams, and post-it note walls for analyzing the market and formulating a strategy.

Embed documents, records, and assets with in-app previews to structure information around your key elements of your business.

Freehand drawing to visualize and build on your ideas, concepts, and strategies without any constraint.

Innovate Together

Video conferencing baked into the platform to feel like you are in the same room.

Real-time cursors for any number of participants. Work with team members and colleagues on a shared canvas.

Comment with context, have discussions and follow-ups on the same canvas. Async!

Multiple access and role levels to streamline sharing, reviewing, and editing your business model canvas.

From Concepts to Value Creation

Multiple app integrations to help you export and import data across different platforms and teams.

Easily access the tools you love with Creately plugins for Github, Slack, Google Workspace, Confluence, and more to execute the strategies.

Export business model canvas as SVGs, PDFs, JPEGs, and PNGs to publish, present, print, download or share.

What Is the Business Model Canvas?

Business model canvas is a tool used to understand a business model in terms of the customers, the value proposition and the methods used to make money. It helps streamline business processes and align the objectives of everyone involved.

How to Create a Business Model Canvas?

• Use a Creately business model canvas template to identify the following 9 business segments. Invite your team to collaborate on it with a secure diagram share link.
• Identify the key business partners. This includes people that you want to help you realize your business idea, like suppliers, investors, partners, etc.
• Decide on the actions you need to take to ensure that your business delivers on its promises and carries out development projects smoothly.
• List down the key resources you need to develop and launch your product and operate as a business.
• To specify your unique value proposition, figure out what you are going to offer your customer and how your business stands out from your competitors.
• Segment your customers by understanding who they are. You can use user personas to record the information you find about each segment.
• Establish how you are going to build your relationship with your customers. Write down guidelines needed to grow your customer base.
• List down the most appropriate channels you can use to communicate, sell and promote your product to your customers?
• Understand how much your key resources and key activities are going to cost. Are these costs aligned with your value proposition?
• Identify the values your customers are willing to pay for and how they prefer to do so. Also, consider how every revenue stream contributes to the overall revenue.
• Share your business model canvas with key stakeholders with a diagram edit/ review link to get their feedback. You can use comment discussion threads to analyze needed changes.

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Business Model Canvas

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Support your understanding of the Business Model Canvas tool from the DIY Toolkit and how you can use it to help you grow your ideas.

This DIY Learn Business Model Canvas module begins with a set of Learning Outcomes . These highlight what you should expect to know and be able to do as a result of studying it.

As you work through the module there are some in-text activities to help test your understanding of the material. At the end, there are self-assessment questions (SAQs), with answers, to help you assess your learning against the Learning Outcomes.

We estimate this module will take between two and three hours to complete for an independent learner with a good level of English and at least secondary level education. The module is divided into smaller study sessions, each of which follows a standard pattern to make it easier for you to plan your time.

If you enrol, via the button above, study the module and complete the quiz at the end of the module you can gain a digital badge and a statement of participation  as a record of your achievement. Digital badges are a new way of demonstrating online that you have gained a skill in your chosen subject. Badges are not accredited by The Open University but they’re a great way to demonstrate your interest in the subject and commitment to your career, and to provide evidence of continuing professional development.

We’re always delighted to hear from our learners. Please send feedback on the module to [email protected] , we are particularly keen to hear what you have done with the skills and tools you have learned.

Whilst the module has been designed to be studied independently this is not the only way it can be used. The DIY Learn Trainers Handbook provides guidance on using all the modules as a basis for group training in a classroom setting. 

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After studying this module, you should be able to:

understand why business models are important

explain how the Business Model Canvas would be useful to apply to your own development ideas

describe the nine elements of the Business Model Canvas

explain why a good value proposition is central to a successful Business Model Canvas

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First Published 25/04/2016.

Updated 01/08/2017

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