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Question 1

Six Components of Osterwalders et al. (2015) Value Proposition Canvas A value proposition canvas indicates the technique to assist in ensuring that a good or service is positioned around what the client values and needs (Inomata et al., 2020). Six components of this model are shown and discussed below concerning the recent innovation namely Citi-Sense:

Value Proposition

Value Proposition

  • Products and Services

As per Pokorná et al. (2015), the set of goods and services assists the clients in accomplishing either operational, social, or sentimental jobs or assists them in gratifying their basic desires. This section concerning the Citi-Sense app includes raising awareness about the environment; pollution warnings; declining health risks; and engagement in ecological decisions.

  • Gain Creators

They define how business products and services create customer gains. These delineate how a business aims to generate results and benefits that its clients expect, desire, or might be surprised by, entailing societal gains, cost savings, constructive sentiments, and operational utility (Ko & Davis, 2023). The Citi-Sense app will create customer gains in the form of apps and social media promotions; apps for pollution-location; and apps for fuel consumption and driving advice.

  • Pain Relievers

They define how precisely a business's products and services eliminate definite customer pains. The company's product usually can solve the defined pains. In respect of the Citi-Sense project, the pain relievers include an eco-information center via which the product will alleviate the pains of the customer. Also, the Citi-sense application is utilized to monitor acceleration and deceleration (Karamat, 2014).

Customer Profile

  • Gains

According to Gierej (2017), the customer in this section conveys their prospects, desires, cost benefits, empathy, and more that they attained effectively. The customer gains in the Citi-Sense innovative project entail a clean environment, saving of money on fuel, and saving vehicle-cost from wear and tear.

  • Pains

It is anything that makes angry a client while getting a job done. The customer pains concerning Citi-Sense entail bad driving habits and no eco-advice.

  • Customer Jobs

These entail diverse tasks, issues, or wishes clients are aimed to deal with, resolve, or satisfy. These are the activities the clients are attempting to perform and accomplish. The customer jobs in the Citi-Sense project include eco-friendly driving, economic driving, and fresh air (Karamat, 2014).

Question 2

Nine Components of Osterwalder et al. (2010) Business Model Canvas

As per Osterwalder et al. (2010), the business model indicates the way a business captures, develops, and delivers value to its clients.

Business model

The nine building blocks of this model are outlined and discussed below:

Customer Segments

These describe the diverse groups of individuals or businesses a company intends to reach and serve. To thrive in the marketplace competition, companies are required to recognize the consumer markets that they serve and form an effectual business model around them. A company should make a rational choice about which segments to serve and which ones to ignore (Dobrowolski et al., 2022).

Value Propositions

These define the set of goods and services that make value for a definite client segment. It can be said that the value proposition is the cause of why clients turn from one organization to another. This resolves a client's issue or gratifies a client's desire. It is what distinguishes the company from its rivals, facilitating it to stand out from the competition and appealing to and retaining the prospective target clients as trustworthy clients of the brand.

Channels

They indicate the avenues that the company utilizes to approach its clients, with a specific emphasis on providing their respective goods and services. It is said that communications, distribution, and sales channels encompass a business’s interface with clients. Channels mean client touchpoints that play a vital role in the consumer experiences. Moreover, they can be partner channels, storefronts, and so on (Setiawan et al., 2021).

Customer Relationship

These define the kinds of relationships established by an organization with definite client segments. Client relationships are vital for the development and expansion of any company, as well as its sustainability in the long run. Henceforth, businesses should recognize the kinds of relationships they desire to develop with their specific client segments to certify the business's success.

Revenue Streams

The revenue streams indicate the cash generated by a business from every client segment. The main motive of a business involved in corporate functions is to surge its shareholders’ wealth. The majority of businesses are for-profit which implies they intend to surge their profits via effective delivery of their value propositions and preserve stable revenue streams for the business (Zoumpoulidis et al., 2021).

Key Resources

These indicate resources that the business needs to develop a value for its clients, providing its specific line of goods and services. Furthermore, they are the business’s assets which are important in enabling production operations, henceforth assisting and sustaining the business operations. The key resources entail financial, human, physical, and intellectual assets.

Key Activities

The key activities of the business emphasize the implementation of the business’s value proposition. It implies that a business must not assure its valued clients what it can’t deliver, since delivering on its value proposition is what differentiates it from its rivals in the marketplace, providing it a competitive edge amongst other sector participants (Diderich & Diderich, 2020).

Key Partnerships

It is noteworthy that a business needs a network of partnerships to assist the business in progressing and scaling up its operations in its primary markets. Considering this, the key partners indicate to the external businesses, contractors, suppliers, and more that the business needs to attain or execute its vital activities and provide intended value to the clients. It can be said that businesses create alliances to improve their business models, lessen threats, or attain resources.

Cost Structure

In the business model, cost structure defines the most vital monetary outcomes of the company while functioning under diverse business models. It is said that developing and delivering value, preserving client relations, and making revenue all incur costs. The cost structure is typically formed in agreement with the business structure with a specific emphasis on the business’s definite goals and objectives (Qastharin & Vanourek, 2020).

References

Diderich, C., & Diderich, C. (2020). Revisiting the Business Model Canvas as a Common Language. Design Thinking for Strategy: Innovating Towards Competitive Advantage, 29-45. Dobrowolski, Z., Sułkowski, Ł., & Panait, M. (2022). Using the business model canvas to improve audit processes. Problems and Perspectives in Management, 20(3). Gierej, S. (2017). Techniques for designing value propositions applicable to the concept of outcome-economy. Engineering Management in Production and Services, 9(1), 56-63. Inomata, R., Kobayashi, N., Nakada, M., & Shirasaka, S. (2020). Proposal of Customer Value Consistency Canvas, Using an Ontology of Value Proposition with Service-Dominant Logic. Review of Integrative Business and Economics Research, 9(4), 47-63. Karamat, S. (2014). A framework for Measurable Value propositions for Business and Service Improvement and Innovation (MVAP) (Master's thesis).
Ko, S., & Davis, C. D. (2023). Value Proposition Canvas and Business Model Canvas. SAGE Publications, Inc.. Pokorná, J., Pilař, L., Balcarová, T., & Sergeeva, I. (2015). Value proposition canvas: identification of pains, gains, and customer jobs at farmers' markets. AGRIS online Papers in Economics and Informatics, 7(665-2016-45080), 123-130. Qastharin, A. R., & Vanourek, G. (2020). Understanding the business model of social enterprise: A case study of Indonesia Mengajar. In The Future Opportunities and Challenges of Business in Digital Era 4.0 (pp. 239-243). Routledge. Setiawan, J., Budiastuti, M. S., Gravitiani, E., & Setyono, P. (2021). Business model canvas (BMC) approach for tourism management strategy of the top selfie raglan, Mt. Merbabu National Park. Geo Journal of Tourism and Geosites, 35(2), 297-303. Zoumpoulidis, V., Valsamidis, S., Nikolaidis, S., & Tsourgiannis, L. (2021). A unified business model canvas for digital intermediaries in the tourism industry. Tourism Management and Sustainable Development, 71-87.

Related topic:-  Innovation and Entrepreneurship

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