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An(other) Introduction to

Entrepreneurship: SIPBS MSc

Martin Gannon:
E: martin.gannon@strath.ac.uk
O: DW8.01
Scenario 1
To enhance students business skills and bring in some
revenue for the department for investment in resources, staff
and equipment. The idea has it source in the success of ‘The
Chemistry Clinic’
(https://www.strath.ac.uk/science/chemistry/chemistryclinic/).
Your team has been asked to come up with innovative ideas
to develop, action and market an equivalent centre for SIPBS.
You have been given permission to consider using all the lab
equipment and facilities you have learned about over the last
two semesters. You should use the business, project
management and marketing skills you have been taught
about so far in this class to provide a solid, business-based,
foundation for your idea. Where you use a ‘business tool’ you
should consider ‘why’ that tool and no another one.
Scenario 2

It has been identified that local companies are seeking to


have their staff developed by allowing them to participate in
CPD courses. Your team has been asked to come up with
innovative ideas to develop, action and market CPD course
focussed upon companies who manufacture fine chemicals
and pharmaceuticals. You should use the business, project
management and marketing skills you have been taught
about so far in this class to provide a solid, business-
based, foundation for your idea. Where you use a ‘business
tool’ you should consider ‘why’ that tool and no another
one.
Scenario 2

The department wished to expand, enhance and deliver a


broader and better range of postgraduate masters courses.
Your team has been asked to come up with innovative
ideas to develop, action and market the postgrad science
masters course to potential students both at home and
abroad. You should use the business, project management
and marketing skills you have been taught about so far in
this class to provide a solid, business-based, foundation for
your idea. Where you use a ‘business tool’ you should
consider ‘why’ that tool and no another one.
Stakeholder Identification

Clearly identify the way different


stakeholders and environmental factors
influence this problem.

Can you think from their perspective?


Idea Generation

Spend the next 20-30 minutes generating a


range of potential ideas/solutions for your
assigned scenario – we’ll run through a
useful tool afterwards to ‘test’ your idea.
The “Business Model Canvas”
The “Business Model Canvas”

INFRASTRUCTURE & CUSTOMERS & VALUE


RESOURCES

PROFITABILITY
Where to start?
Identified a need/problem…

NEED/PROBLEM
Identified a solution…

SOLUTION
A cost driven idea…

COST DRIVEN
A value driven idea…

VALUE DRIVEN
Customer segments

“The Customer Segments Building Block defines the


different groups of people or organizations an enterprise
aims to reach and serve.”

• Who is value being created for?


– Mass Market
– Niche Market
– Segmented / Diversified
– Multi-sided Platforms (e.g. newspapers selling to readers +
to advertisers)
• Make sure these customer segments are viable!
Value proposition

So, what value can you offer these customer segments?

“The Value Propositions Building Block describes the


bundle of products and services that create value for a
specific Customer Segment.”

• What exactly do we mean by this?


– Is this value financial?
– What value is being delivered to customer?
– Which needs are being satisfied?
Value proposition
Performance
Newness Customization

Price

Design
Brand/ Risk
Status Reduction

Cost
Convenience/
Reduction
Usability
Customer relationships

“The Customer Relationships Building Block describes the


types of relationships a company establishes with specific
Customer Segments.”

• Is this Personal or Automated?


• What is the purpose of relationship?
– Acquisition?
– Retention?
– Upselling?
• Changing relationship?
• How can you best exploit these relationships?
Channels

“The Channels Building Block describes how a company


communicates with and reaches its Customer Segments to
deliver a Value Proposition.”

• What exactly are these channels?


• Through which channels do your customer segments
want to be reached?
• How are channels integrated?
• Cost efficiency?
• Most effective?
1st task

• Fill in the customers & values building blocks


of the business model canvas.
• Things to keep in mind
1. Is my product or service actually
required/desired?
2. Is it different (enough) from what the
competition is offering? What are your
advantages?
Key resources

“The Key Resources Building Block describes the most


important assets required to make a business model
work.”

– Physical
– Financial
– Intellectual
– Human

• What key resources does the Value Proposition require?


• What key resources do you have?
Key activities

“The Key Activities Building Block describes the most


important things a company must do to make its business
model work.”

• Important in thinking through critical success factors

• Production?
• Problem Solving?
• Platform/Network?
Key partners

“The Key Partnerships Building Block describes the


network of suppliers and partners that make the business
model work.”

• Who are the key partners?


• Which resources are acquired from the partners?
• Benefits of partnership
– Optimisation & economies of scale
– Reduction of risk and uncertainty
– Resource/activity acquisition
2nd task

• Fill in the infrastructure & resources building


blocks of the business model canvas.
• Things to keep in mind…
– What real benefits do your partners bring?
– Can I make things more efficient? How?
– Which resources are critical to business success?
Revenue streams

“The Revenue Streams Building Block represents the cash


a company generates from each Customer Segment (costs
must be subtracted from revenues to create earnings).”

• Transactional revenue?

• Recurring revenue?

• For what value are customers willing to pay?


– What are they currently paying?
Key issue - deciding on price…
Cost structure

“The Cost Structure describes all costs incurred to operate a


business model.”

• How much does it cost to create and deliver value?

• How much do the key activities cost?


– Be mindful of underestimating costs
– Are these costs intermittent?

• Is the business built around cost structures (i.e. Ryanair)?


– In other words, is your business dependent of low-cost?
3rd tasks…

• Fill in the cost & revenue building blocks of


the business model canvas
• Things to keep in mind…
– Is my idea going to be profitable?
– Can you increase revenue streams?
– Is it going to be scalable in future?
Where to go from here??

Now that you’ve completed the business model canvas, you need to
validate your assumptions…

1. Get product/service feedback from target customers


2. Research customer base
3. Market research
4. Financial analysis
5. Risk analysis
– Critical success factors

At this stage, you’ve planned as well as you can. Time to see if it


pays off in the real world…