Tools like the Business Model Canvas (BMC) are becoming increasingly popular within large enterprises. It turns out it isn’t just a start-up thing. Product Managers everywhere are using them to articulate the business case for new products and services.
The BMC is of the core tools we use when assessing the viabilty of an idea. It’s a quick and effective way of capturing a business model and can help you visualize the hypotheses and assumptions you are making about your business.
Spoilt for choice?
Not exactly. There are two clear leaders in this space.
These canvases capture similar information but the Lean Canvas tends to be more useful for a wide variety of ideas, where the BMC really focuses on getting new enterprises off the ground.
What are the differences?
The Lean Canvas uses the Business Model Canvas as a starting point. Ash describes the canvas as a tool to systematically test each of the 9 subparts of the business model in order of highest to lowest risk.
On the Lean Canvas, boxes for Problem, Solution, Key Metrics and Unfair Advantage replace Key Partners, Key Activities, Key Resources and Customer Relationships from the BMC.
Many agree that the customer problem-focus of the Lean Canvas can be more effective in steering you to build business models and solutions to address the customer need.
An emphasis on discovering your unfair advantage can also help get you ultimately get to a more successful business model, and the capturing of metrics encourages an iterative, step-by-step development process.
By contrast, the BMC takes you to a more strategic conversation and position – thinking more about a business rather than just a single product or proposition.
This holistic view is one of the reasons organizations use the BMC – it facilitates better conversations with business stakeholders than the problem- and user-focused Lean Canvas.
So which should you use?
Pedro who works on the team colleague prefers the BMC, whereas I prefer the Lean Canvas.
We’ve had plenty of discussions over who is right, or why our preferred choice is better, but fundamentally both tools provide a similar benefit/opportunity. That is – to represent a business model on a single page.
Further to this, the canvases can serve as tools for :
- Ideation (check this blog)
- Validation of assumptions
- Encouraging conversation