Preparing for a presentation on the Business Model Canvas and Design Thinking for a major bank in Switzerland, I ran the slide-deck by a good friend and talented designer; Tom Djajadiningrat. His feedback was crisp and to the point; “Nice! Waar ik me druk om kan maken is als developers de value proposition uitsluitend zien als wat voor het bedrijf waarde creëert… en totaal vergeten om value te zien uit het perspectief van de gebruiker.” which translates into something like: ‘Nice! What worries me is when the developers see the value proposition only as something that creates value for the company… and completely ignore the point of view of the end-user”.
To some extend this is due to misuse of the Business Model Canvas; where the value proposition is mapped against the customer needs (and not the company needs), but this is clearly a risk when using the Business Model Canvas early in the design process, i.e. to map out the business model and identifying the value proposition before designing the actual artefact.
Yes, value proposition is a bit tricky, especially when it should drive product design. It is not automatic that the thing that makes a product successful also is recognised as what generates profit. Focus on value proposition is a constraint within which to do product design.
The example that came to mind is the one of the first iPod. The ‘value proposition’ of the iPod was ‘1000 sings in your pocket’. But that was not new. I mean, at the time you could buy a variety of MP3 players. You needed to almost have a Masters in informatics to manage your (portable) music.
Equally important for the iPod’s success was the easy management of songs via iTunes, and the access to the songs while on the road with the ‘click-wheel’. Most importantly, the iPod was just gorgeous, and made all of us ran out to discover the amount of our ‘disposable’ income and whether the iPod was priced accordingly.
Creativity and design is often ignored or discarded as something trivial. We all recognise when something is ‘good’ which gives us the feeling that we all are experts on ‘good’. But being able to recognise what is ‘good’ does not mean we are able to create something that will be recognised as good. That takes special skill, a particular eye and a creative mind. Designing a ‘good product balances overall design with elegantly crafted details. Challenges do not come more wicked than that. Starting from the value proposition of ‘a 1000 songs in your pocket’, the iPod and it;s success was not trivial.
Some products succeed whereas many products fail. Designing a successful product talkes more than defining the value proposition, and certainly more than defining what makes a profit for the company. The click-wheel did not make a profit for Apple. But would the first iPod with up/down buttons instead of a click-wheel be equally successful? Doubtful. If it is not identified as ‘value proposition’ does not diminish it’s importance for the product success.
Also interesting in this context is ‘iTunes’ itself, which was not developed from scratch by Apple, but obtained through the acquisition of the company Soundjam. More importantly, the main activity of the Soundjam developers after having become part of the Apple family is said to have been ‘simplifying’ the iTunes interface; making it more user friendly. Thus, what creates ‘value proposition’ and for whom?
So, yes, the canvas helps us to strategyze based on value propositions, customer segments and other business constraints, and yes, the BMC should be used early in the process. The business model canvas helps to set the constraints within which to design, and also to understand the constrains that design could challenge. But the canvas is a tool to assist in the progressive elaboration of the project and we have to realise (and remember) that 1) having identified the value proposition is not a substitution for designing the product, and 2) product design goes far beyond the – often abstract – value proposition.