What is the Business Model Canvas?
The Business Model Canvas (BMC) is a strategic management and lean startup template for developing new or documenting existing business models. It is a visual chart with elements describing a firm’s or product’s value proposition, infrastructure, customers, and finances.
In other words, the BMC is a design tool for the creation or renewing of business models. The BMC is often used during ideation sessions and to regularly check the viability and feasibility of business models.
What is the NEXT Canvas?
However, the NEXT Canvas is an innovation framework used to test business models and track the business idea’s progress turning into a validated and profitable business model.
The NEXT Canvas visualizes the four types of proof an idea needs: First, the team needs to prove there is a problem to solve, then that the team can create a solution to solve that problem. After there is a proven solution, there needs to be proof that customers will pay, and finally, the team needs to prove that the business model can scale.
This is not a linear process. When proving the solution, the problem might need some zooming in. When the team is ready to prove the business model can scale, the whole NEXT Canvas needs to be reconsidered to make the business model fit the larger customer segment. It is interesting to observe that it actually becomes harder to prove a business model the further the idea moves towards scale and not easier. The team is juggling with more and more puzzle pieces to fit together to make a business model work. The BMC is regularly used in this process to keep checking the viability and feasibility of the envisioned business model.
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What is the difference?
The BMC is primarily used to design business models, where the NEXT Canvas is used to track teams’ progress from great idea to scale. The NEXT Canvas is also used for stage gates and portfolio management. When we map multiple teams onto the four stages, we create a great funnel of our innovation initiatives.
The NEXT Canvas and the BMC are thus not mutually exclusive but work well together as tools to create, test, and renew ideas.
GroundControl offers a digital version of the NEXT Canvas for both the teams and for portfolio management. Teams can use GroundControl to determine what is currently most risky and create, design, and execute experiments. It is a great tool for innovation managers to get insights into where each startup is in its maturity and how fast it is moving towards scale.
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