Creativity and Business Model Innovation (part 2)

flickrThis week I am looking at different ways we can put the innovation back into business model innovation. Taking the approach that creativity in thinking can be done deliberately, I’m applying various deliberate creative thinking techniques to what is now becoming the familiar area of business model generation, lean startups and customer development. Last week I looked at using the TERMS Star for putting your value innovation into hyper drive, today I’ll take a look at using SCAMPER to power up your disruption when pivoting from one business model to another.

What happened to Game Neverending?

Game Neverending (GNE) was a web based massively multiplayer online game launched in late 2002 and shutdown in 2004. Designed to be user extensible, the game encouraged real time browser chat with players leaving messages and game objects for each other at various locations. With poorly defined gameplay (there wasn’t even really a concept of winning), players quickly developed strong social connections with lots of humour and quite a few pictures being exchanged along with the intended gaming objects. By 2004, the site had relaunched as Flickr.

So what happened?

  • Customer job: GNE was about sharing social connections (and photo’s), Flickr is about sharing photo’s (and chat e.g. photography advice)
  • Revenue Stream: GNE had no revenue stream, Flickr uses a freemium model with premium users paying to exchange more pictures
  • Customers: GNE targeted online gamers with a sense of humour; Flickr targets photographers, image brokers and businesses wanting to buy images

The pivot certainly seems emergent. The business observed a change in customer behaviour and capitalised on that. The pivot went from a poorly defined and revenue free business model to one with clear revenue streams for well defined customers solving specific jobs. Given a business model canvas and your powers of observation would you have come to the same conclusions?

Using SCAMPER to generate massively multiple business models

SCAMPER was developed as an educational tool for improving imagination and creativity in children. The acronym stands for Substitute,Combine, Adapt, Modify, Put to another use, Eliminate, and Rearrange. The basic idea is to use each of the prompts as a starting point for generating large numbers of new and creative ideas. Here it is applied to the generation of business model concepts, starting with the Game Neverending business model:

  • Substitute: break down your core business into its major component services and loot at substituting in alternatives. GNE had chat rooms, a game world map, geo tagging (to leave files in a location), etc. What if the map were substituted with the real world, or if geo tagging were exchanged with event tagging? What if the focus was on music instead of photo’s?
  • Combine: what if you combined your service with someone elses? What about combining GNE with Bit Torrent (for peer to peer photo exchange), or twitter (for a locate me service for people, or for photo enhanced breaking news)?
  • Adapt: how can this service be adapted to solve another customer job? we clearly saw GNE adapt to fit the sale of images, but what if it had been adapted to fit the needs of others needing location aware file exchange? What about music festival goers, or a way of attaching CVs to employers, or property sales, or restaurant reviews?
  • Modify: how can you change service components, adding or subtracting core features to create value? this can be a great place to try out different revenue models such as licensing, or pay per view. What if Flickr had adopted a peer to peer model (i.e. no file storage costs or premium account concept) and just taken a percentage fee on the sale of any photo’s? What if they had modified the account model to include buyer accounts such as newspapers or magazines? Perhaps the service would have focused on managing the sale instead of managing the files…
  • Put to another use: similar to adapt in this case, the prompt here is about using the core services to solve a completely different customer job. What if the site had moved away from social interactions entirely and user their technology platform to help multi-location businesses keep track of their IP?
  • Eliminate: what features and services can be removed entirely and how does this change the business model? What would happen if the chat was eliminated? or the locations? or even the file exchange? Spending time with each of these options might have led the business towards different mechanisms around social interaction such as interest based post it notes, or recommendations, or even review mechanisms. What if Flickr had become a training site for budding photographers wanting advice on how to improve their pictures? Perhaps the business would have developed other training offerings or combined with the online universities?
  • Rearrange: what changes can be made to the workflow sequence, or to users roles? What if the premium accounts were free and the free accounts were paid? Probably not a great idea if you leave it like that but what if this concept were pursued to explore alternative account models? Perhaps the business would have tried out the idea of paying its users every time they uploaded a quality picture, and then claiming the rights for itself to sell on to potential buyers?

As with many other creative thinking techniques, the aim here is to create a lot of different ideas and then explore those ideas as the basis for more ideas. The further away from your original concept you get, the more likely you are to discover something truly disruptive. At the heart of Bob Eberle’s technique is the desire to stimulate curiosity, imagination and the exploration of ideas. By focusing your efforts on business model innovation, perhaps you too can come up with the next market disruption.

Next time, I’ll take a look at using Five Whys to explore the customer jobs, gains and pains that make up your value proposition.

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