Conclusion validity, reliability and controllability of the Business Model Canvas

5.4.1 Conclusion Validity of the Business Model Canvas

Based on the result of the six interviews conclusion about the different validity types are extracted. The conclusions are about the strengths and limitations of the Business Model Canvas.

Conclusion construct validity of the Business Model Canvas

By analyzing the results of the interviews four important points can be

recognized. The construct of Value Proposition is good; however based on some interviews suggested that Social Value is missing. They state that it is important to broaden the goal of a business model based on the Business Model Canvas, for example Social Enterprises, Non-profit organizations or governmental organizations. Furthermore, issues regarding the overlapping building blocks Customer Relationships and Channels, and Key Activities and Key Resources are mentioned. The way the interviewees design the Customer Relationships and Channels are overlapping and intertwined. This leads to confusion about or neglecting of a building block. For Key Activities and Key Resources the same problems occur, the distinction between the two building blocks is not clear and the necessity is doubted. Next to the overlapping character of those building blocks, the financial building blocks Cost Structure and Revenue Streams lead to some critiques. There is not a clear consensus about the limitations of these two building blocks. However, they are worth mentioning: the lack of details of calculations, the phase of application of the calculations and the time element is missing in the BMC to calculate proper financials.

Furthermore, Competitive strategy is mentioned as a missing building block in the BMC. There is consensus between the interviewees that competitive strategy should be taken into account to face external risks such as competition, market influence and environmental forces. As mentioned, this should be done by making a story around the business model which covers the aspects of Competitive strategy or an additional building block.

Conclusion internal validity of the Business Model Canvas

The interaction between the Business Model Canvas and the organization is investigated in this paragraph about internal validity. Overall the interaction between the BMC and the organization is good. The tool is easy to understand after some explanation and is easy to operate. The visual representation of the tool is very strong which results in a lot of possibilities in using the tool from different perspectives or with different goals. The tool is beneficial for alignment in a business model development process. However, some limitations and

remarks are mentioned. The tool is not beneficial for creativity because the developers need to think in building blocks. On the contrary, a benefit of the tool is that it structures the creative thoughts, which helps to communicate the

Conclusion external validity of the Business Model Canvas

The external validity is the way how to generalize the content of the business model tool to other people and if the BMC fits to additional tools. The

communicability of the tool is a strong point of the BMC. The tool is used for communication of the business model to managers and partners. Due to the universal language it can be generalized from specialist to business developers. Creativity tools such as ‘Klantwaarde generator’, Brain Bricks and simple drawing exercises are used. Furthermore, for context analysis, the Pains and Gains

diagram and the ‘Omgevings’-analysis is used to add external influences to the BMC.

Conclusion pragmatic validity of the Business Model Canvas

Pragmatic validity in terms of validating a business model tool is about the recognition of the results. The recognition of the results is tested with the successfulness, the continuity and the impact on the structure of the

organization. There are some hints that the Business Model Canvas is beneficial to the success and continuity of the organization. However, it cannot be stated that the BMC has direct impact on these variables. The simplicity and the structural way of making business models might be beneficial according to the interviewees. Furthermore, the structure of the whole organization is not influenced through the BMC at the organization of the respondents. However, two respondents see opportunities for the BMC to do so in the future. In business model developments groups the BMC has impact on the structure of the

organization of the group as the BMC is used as leading tool of communication. In recognition of the results, a big limitation is identified on the financial building blocks of the BMC. It is not clear how to calculate the financials. The interviewees think the calculations can be provided later in the development process, because at first it is important to structure the ‘gut feeling´ of the idea.

5.4.2 Conclusion Reliability of the Business Model Canvas

In terms of stable results, the Business Model Canvas does not lead to the same results when filling in the BMC for the second time with the same goal. Factors such as different focus, perspective and time have influence on what to fill in the different building blocks. This does not mean that the reliability is an issue. The filled-in BMC is easy to replicate. However, you need to know the ´story´ behind the business model to replicate the building blocks in the right perspective. 5.4.3 Conclusion controllability of the Business Model Canvas

The Business Model Canvas is not providing a structure or motivates users of the BMC to administer the sources, assumptions and decisions. This lack of structure of administration leads to a low controllability of the developed business model. 5.4.4 Conclusion strengths and limitations of the Business Model Canvas based on the interviews

Based on the six interviews strengths and limitations has been identified in

the following table is constructed. The main limitations are about; the Value Proposition and other purposes then profit generation, overlap and difference in detail of individual building blocks, external forces such as competition are not taken into account in the Business Model Canvas.

Strengths: Limitations:

The construct around the Value Proposition is good with one remark. Which is mentioned in the limitations column.

Limitations regarding the Value Proposition is that it does not include Social Value. Therefore, non-profit and governmental organizations cannot be captured in the Business Model

Canvas. The visual representation of the

Business Model Canvas is good. Consensus is recognized between the interviewees. This strength results in a lot of possibilities in using the tool from different perspectives and different starting points. This makes the tool easy to operate.

Overlap and intertwine of the building blocks Customer Relationships and Channels, and the overlap of Key Activities and Key Resources. This leads to confusion or not using one of the building blocks.

Overall the interviewees agreed on the benefit of the Business Model Canvas on the communicability of a proposed Business Model.

The lack of room in the building blocks Cost Structure and Revenue Streams for proper financial calculations. Also, the time element is missing.

The way of using the Business Model Canvas is easy to understand, however there are some remarks on individual building blocks. These are mentioned in the left side of this table.

Competitiveness is missing in the Business Model Canvas. For example, several interviewees mentioned a missing building block comparable with a Competitive Strategy building block which takes into account external factors such as risk, competition, market influence and other environmental forces. In terms of creativity, a strength which

can be attributed to the tool is the structural effect on the creative

thoughts. This result in a clearer view which then can be communicated easier and alignment during the process can be established.

The Business Model Canvas in itself is not beneficial for creativity, because the designers of a business model are forced to think in the nine building blocks.

The Business Model Canvas does not provide structure or motivation to administer sources, assumptions and decisions. This results in a low

controllability of design decisions afterwards.