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Developing business ideas for drone technologies
Developing business ideas for drone technologies

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1 The business model canvas

Alexander Osterwalder introduced the concept of the Business Model Canvas in his PhD dissertation (Osterwalder, 2004). In a recent interview, Osterwalder discussed the uses of the business model canvas as a tool:

The Business Model Canvas is used in very many different ways. It’s really used the way we envisioned it to be: to visualize and assess an existing business model or to create an entirely new business model. We envisioned both uses, but it’s just one tool.

(Osterwalder & Euchner, 2019, pp. 12–13)

As Osterwalder explains, this managerial tool is used to visualise business models of companies, enabling a collaborative process among stakeholders. Thanks to its popularity, stakeholders can discuss the design of a new business model or the changes to an existing one, sharing ideas around a common framework – the business model canvas.

The original business model canvas is made of nine blocks, as shown in Figure 2. The original blocks can be grouped into four main areas: customers, offer, infrastructure, and financial viability.

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Figure 2 The original Business Model Canvas with nine blocks divided into four areas

One could ask: why has it been designed in this way? The key idea behind this representation is that the value propositions (Offer) are at the centre, and the right-hand side works in conjunction with the left-hand side: the infrastructure enables an offer to be made to the customers. At the bottom of the canvas, the balancing of costs and revenues is considered in the financial viability area.

Of course, this is just one possible way of representing business models, and there are plenty of alternatives. For instance, the growing attention on sustainability has led to the development of frameworks that depict sustainability elements more directly. Figure 3 shows the sustainable business model canvas as developed by the CASE project (Competencies for a sustainable socio-economic development) in collaboration with Wageningen University, a partner of the ICAERUS project.

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Figure 3 The sustainable business model canvas

In this representation, eco-social costs and benefits are represented below the costs and revenues. Whereas this model might look simplistic in just adding two building blocks, our choice to adopt it comes from the practical experience of ICAERUS partners in their interactions with stakeholders and applications to funding calls. Its benefit lies in its direct derivation from the original canvas developed by Osterwalder: adopting this more complete form of the canvas builds on an understanding of the original structure, with no need to uproot the existing blocks and the concepts they represent.

It is important to note the necessity of matching sustainability benefits not only with related sustainability costs, but also with the cost structure. Similarly, sustainability costs should be counterbalanced by both sustainability benefits and revenue streams.

Evidently there is not just one version of the business model canvas – and you might be involved in projects where different evolutions of Osterwalder’s original concept (2004) might be used.