Connecting Community and

Business Model Innovation

What’s a business model?

1.  A story of how an organization creates, delivers, and

captures value.
2.  A network of capabilities and a sustainable financial
model to deliver value to target customers.
3.  The magical intersection of a problem that matters +
a solution that delivers + numbers that work.
(Scott Anthony, Innosight)
How does ‘community’ fit into a business
model?
Quite simply, “community” can be a feature of one or
more of the three aspects of a business model:
1.  How value is created for customers
2.  How value is delivered to customers
3.  How value is captured for stakeholders
‘Community’ is part of a business
model when community is the
structure through which a business
creates value, delivers value, and/
or captures value.
Examples of community as a way to create
value:
•  Co-creation:
•  IBM Innovation Jams, Dell Ideastorm, LEGO,
Wikipedia, Genius, Barclaycard Ring
•  Marketplace:
•  Ebay, Amazon
•  Social Media:
•  Facebook, Twitter, Instagram
Examples of community as a way to deliver
value:
•  Competitions:
•  Netflix prize
•  Recommendations/Idea Evaluation:
•  Amazon, Netflix, Google
•  Barclaycard Ring
•  Quirky
Examples of community as a way to capture
value:
•  Crowdfunding:
•  Kickstarter, Indiegogo, Patreon, Rally
•  Prediction Markets:
•  Eli Lilly, Google
•  Sharing:
•  Uber, Sidecar
What do we really mean by business
model innovation?

•  Innovation = a new way to deliver value to customers.

•  Business model innovation = a new system for
delivering value to customers.
How can you help your company
understand how community
can drive business model innovation
— whether by tweaks or
transformation?
1.  Understand your company’s current
business model.
Don’t be daunted if you don’t already know — it’s
common for even management to have a slippery
grasp on their company’s business model.
2.  Understand how business model
innovation processes work.
Business Model Design Process
3.  Understand that business model tweaks
and transformations — in fact, all
innovation — starts with a customer
need or “job-to-be-done”.
•  A community manager who works directly with
customers is in a perfect position to discover these
needs.
•  A community manager can understand how a
community can be better integrated into the
company’s current business model AND how the
community can serve as a lever for an entirely new
business model.
“My challenge to all the community
managers, builders, and strategists
out there — reclaim the term
“community” as a vital part of the
product and the lifeblood of the
business, or invent a new term
altogether.”