Updated: Jul 30
Written by Steph Sanderson, Founder & Business Consultant at Innovate and Thrive.
Business model. Yuk. What a horrible phrase, so corporate and definitely not something you associate with creative business. In fact, isn’t the whole point of a creative business to be creative and free flowing and make money doing what you love?
Yes. And you need a business model. In fact, a business model will help you to be creative, responsive and make money. Because a business without design can end up feeling pretty off thanks to a collection of haphazard decisions and clunky systems.
What is a business model? It’s a business design process that brings a human-centred approach to innovation. It combines the core principles of client experience, with experiential design, business strategy and human skills and needs. The result? A thriving business. It enables you to fulfil your promise to a client or customer, but it also future proofs your brilliant business for the long term.
But what does an effective business model actually look like? And why do you need it?
Read on to uncover my 4 core pillars of a business model.
Where do you begin?
There are several business models you can draw on. One of the most popular is the McKinsey 7s model, which you’ll see in businesses around the world. But I like to keep things simple, so I’ve created my own model that I use with clients. Let me introduce you to BOPS!
BEHAVIOURS - Values, information flow and decision making
OPERATIONS - Processes (including the client experience), systems and facilities
PEOPLE - Skills, organisation structure, roles and performance management
STRATEGY - Ideal clients, products and services, pricing, financial forecasting and marketing
Essentially, it’s about creating a framework with sound pillars, and taking your business from ok to great.
How do you use it?
Questions to explore: How do you want your business to feel to your clients and team? What does your business stand for? How does it affect what you and your team do on a daily basis?
Shared values, otherwise known as your company culture, shows your people and your clients what you deem to be important in the way your business runs.
This could be creating a collaborative spirit across your team. Or building an environment of constant improvement. Maybe it’s about your purpose, and motivations beyond financial income.
Your business should live and breathe this culture… you should be known for it. And it should align entirely with your business vision and motivation, starting from the very first day your business comes into existence. It will inform everything, from your communication styles to your decision making and leadership styles.
TOP TIP: Don’t tell people about your culture, show it! It should be seamlessly woven into different aspects of your operations and be a core part of your business design.
Questions to explore: What is the simplest, most time and cost effective way to manage my business in line with my values and desired brand experience? Do I really *need* the tech? Or am I following a trend?
We often collect systems; we try them on, chuck them away and move onto the next. It can be difficult to find the one that works for your company, especially if you aren’t 100% sure what your business actually needs.
The issue with this approach is that it massively undervalues the impact that streamlined systems can have on your business.
We use systems to manage people, clients and products, and then create the processes that ‘hold up’ these systems. The ultimate aim of these systems and processes is to save you time and money.
Picture those endless repetitive tasks that you find yourself labouring over on a daily basis… invoices, client onboarding, expense reports, email sequences. The list is never ending. The right systems will take over those tasks for you and become your ‘tech stack’ (aka, the foolproof set of systems that keep your business running).
Systems also contribute to the bigger picture; they integrate consistency and efficiency into a business. This then has a knock on effect on your customer experience and team productivity, ensuring that everyone understands their role within the wider business and that any bottlenecks can be identified and cut out immediately.
TOP TIP: Keep it simple! You don’t want to end up with so many complicated systems that you actually end up losing time just from navigating them. You should also review them regularly and update when necessary. Remember; cheapest does mean best fit. Most sophisticated doesn’t mean best fit. Best fit is what works best for you within your budget!
Questions to explore: What skills do I need to deliver the business I expect to have in the next 12-18 months? What will my role look like? How can I break what’s left down into roles? Do I want to hire or outsource? What does that process look like? What will hiring/outsourcing do to my financial requirements?
There is no successful business without the right talent bringing it to life. Whether that’s you, or you and a team.
Once you understand the skills you need, the roles they will encompass and how these roles will be integrated into your business, you then need to consider the type of person you need to fulfil those spaces.
The talent you choose goes far beyond the skills they possess on a piece of paper. Personality traits, working styles and individual motivations should all be carefully considered when bringing a new person into your team.
I believe that this is one of the most important steps for a business that has aspirations of scaling. Attract the right people, and you will find yourself at the helm of a productive, excited team that brings the best out in one another. Find someone that doesn’t fit in with your company culture, and the opposite could be true. Low productivity, office politics and a high staff turnover. Not what you want, in any circumstance.
TOP TIP: Take the same approach for employees and outsourced support. If you don’t think ahead, you’ll risk reactive hiring which rarely works out well in the long term. And if you’re outsourcing, be aware of the IR35 regulations that impact contractors.
Questions to explore: Do I want to design my business around the skills I have today, or the potential future trends of the industry I’m in? What is my mission and vision? What are my objectives? What is the starting point for my services or products? And how will I price them for profit?
Your business strategy should be seen as a high level, guiding view of your business. In a nutshell, this will cover WHY it exists, WHO it’s for, WHAT it is, WHERE it’s going and HOW.