Behaving like a lean design startup
It’s no longer business as usual. Now is the time to rethink your design business and there’s a lot to be learnt from the lean startup process. Build, Measure, Learn: that’s the maxim of a lean startup.
Across the pandemic a lot of our work was with design businesses looking to reshape (have avoided using the word ‘pivot’). Early on many of the businesses we dealt with recognised the pandemic was going to be a game changer. They needed to act like a startup; build a new business approach, measure it and learn how to improve it.
All of them were looking for a simple tool to rethink their model and get new business. It needed to be scaleable. It had to be manageable, and it had to fit the capability of the studio (time and money).
We introduced them to the Business Model Canvas.
A business model for Australian studios
We know that if you’ve done work with the business model canvas you may be inclined to stop reading …but please read on. I guarantee it will change your business.
If you don’t know about the canvas this video will explain it.
Some designers may have been introduced to the Canvas in a design road show that happened a few years ago. The presenter used a traditional approach we improved for the Australian design market.
In the Business of Design publication we tweaked the base model making it more relevant to the Australian design market. We call it the Design Business Model Canvas; a model we’ve used successfully in hundreds of design studios.
What is a business model?
A business model is a different way of thinking about your business and where you want it to go. A design business model describes how a design studio creates, delivers, and captures economic or social value for clients.
The process of business model design is part of business strategy. It can be a quick and dirty exercise that helps you rethink your business.
The design business model canvas is best produced quickly, then rapidly tested with clients and reconfigured. The model you choose is then detailed in your business plan.
One of the major proponents of the business model canvas is Steve Blank, a serial entrepreneur and originator of the lean start-up concept.
In an article for Harvard Business Review, Steve Blank explains that launching any new business has always been a hit or miss proposition. He quotes research by Harvard Business School’s Shikhar Gosh which shows that 75% of all start-ups fail. Blank believes the answer is in the “lean start-up”.
He compares the business model approach to a traditional business plan approach. As he says: the “lean start-up”, favours experimentation over elaborate planning, customer feedback over intuition, and iterative design over traditional “big design up-front” development.
According to Blank, the business model is just a hunch or hypothesis (and so is the business plan). The difference is the business model can be prepared in a few hours. Blank believes that as a business owner you rapidly develop a business model and then “get out of the building” to test it with clients.
The Design Business Model Canvas
The Design Business Model Canvas is different because it adds a Competitor column and it turns the Key Activities section into Strategies and the Value Proposition into a Design Value Proposition.
We think you can’t work out your competitive advantage without understanding your competitors. It’s not about trying to ‘knock them off’ – it’s about identifying how you differ and why that difference should be important to your clients. Identifying your onlyness.
The Key Activities section in the canvas sets out the strategies you need to get new business. Using this, and the Design Value Proposition, you can identify and target the type of work you want to do.
Our approach varies from most consultants who help you write the Canvas and then leave you to work out how to implement it. We follow through by helping designers develop a series of strategies to follow. We do this through mentoring.
The beauty of this approach is that having learnt how to use the Canvas in your business, you can then use it with clients. You have converted an expense into a revenue stream
One of the studios we mentor now uses the Canvas as the first stage for an identity or branding project. Since starting this approach, project budgets have increased and in one case what had been a one-off job has turned into a 12 month project with a client.
If you would like to hear more about the Design Business Model drop me an email and we can set up a time to chat.
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Greg’s passion is the research and development of methods that improve design management and the role of design in business. Greg has developed a series of processes and tools to help designers manage their business better along with a series of workshops that show designers how to use these tools.