This post was originally published on the ExtremeFactories Project site. The purpose of the project is to develop an internet-based platform implementing agile management methods for business innovation processes in industrial SMEs. Vaibmu Ltd is one of the consortium partners.

Introducing systematic innovation management tools for SMEs is an inspiring and challenging task. However, it also raises questions about the risks of introducing new ways of doing into companies that could be described as “process virgins”.

“How to introduce analytics driven systematic innovation processes in a small creative furniture design company without killing the essence of the business: creativity?”, “Does every company need systematic innovation tools in the first place?” and “What kind of change should the new tool bring into a small organization?”. These are valid questions.

Roger Martin may answer at least the last of the above questions. In his book, The Design of Business, he introduces the term “design thinking”, which balances analytical thinking and intuitive thinking, enabling an organization to both exploit existing knowledge and create new knowledge. This is how Martin describes how to become a “design thinker”:

Rather than being cowed by a reliability-oriented world and becoming a prisoner of it, the design thinker develops a stance that puts a priority on seeking validity and making advances in knowledge, even if that stance places the thinker at odds with the organization’s culture. In addition to mastering tools for analyzing the past and using that analysis to predict the future, the design thinker develops the capacity for observation, for seeing features that others may miss.

That makes a lot of sense and the ambition level of the ExtremeFactories Project should be set accordingly. Helping SMEs to become “design thinkers” makes a motivating target for the whole project.

Being able to direct creativity into areas where it is are most needed is one of the key value needs of the target customers. Another need is to have a flexible and light framework for planning the idea’s execution. “How the value added will be delivered for the customer with profit”. One good way to serve both of these needs could be a business model framework integrated in the ExtremeFactories’ tool.

The table below lists key elements of three different business models: A) Johnson et al, B) Osterwalder et al and C) Lindgren et al. Now, listing only the key elements is just scratching the surface and all of the frameworks are comprehensively analyzed in the NEFFICS project and their report as well as the other references are recommend for further reading (see references below).

As one can see, in terms of key elements, the above-mentioned business model frameworks are really close to each other and share common elements, notably the “value proposition”. There are differences though, however there were some good reasons why they were selected:

The Johnson et al model puts special focus on key resources and processes, or let’s call them building blocks of “key success factors”. Some very similar approaches split the key resources further into i) Assets and ii) Capabilities (people, skills) especially to underline the role of human resources.

Osterwalder’s model seems to contain all the necessary elements needed of a comprehensive business model. Moreover, they have successfully made the framework easy to understand and easy to communicate through their visually outstanding book and introducing a business model canvas concept. Making things understandable and useful is a great value proposition as such.

Lindgren et al emphasizes the role of the value chain in the business models. It follows more closely Porter’s value chain model than Johnson et al and Osterwalder et al.

Business model frameworks could be seen as a means of communication: a good business model unifies the daily language by providing a formal name and structure for the critical business elements. This in turn, helps to focus on ‘critical things’, thus supports both continuous improvement and innovation. Flexible business model frameworks are beneficial tools for the SME segment and therefore will be taken into account in the ExtremeFactories Project.

References:
A: Mark W. Johnson, Clayton M. Christensen, and Henning Kagermann: Reinventing Your Business Model, HBR, Dec 2008
B: Osterwalder A, Pigneur Y: Business Model Generation – A Handbook for Visionaries, Game Changers and Challengers. John Wiley and Sons, 2010
C: Peter Lindgren, Rasmus Jørgensen, Yariv Taran, Kristin F. Saghaug: Deliverable D 4.1 Baseline for Networked Innovation Models, NEFFICS Consortium, 2011

How about magazines? It seems that the first tablet versions are already taking the product from a “reading and browsing” experience to some other place -audio, video and instant interaction-. From the consumer point of view, we are obviously talking about two different competing products, which differ from each other from the creative process to the production to the final act of consumption.

It is implied that the migration to e-reading will lead “just” to an enhanced purchase, storage and consumption experience. However, this doesn’t seem to be the road-map for magazine publishing. We at Vaibmu see that magazine publishing will face more radical changes than book publishing. We see two optional paths:

1. The consumers will re-allocate their time, now spent in magazine reading, towards new digital product types as tablets. In this scenario, magazine publishing process as we now know it will disappear
2. “Tablet reading” will be a part of the internet surfing experience, but the consumers will still appreciate magazine-packaged content, albeit enhanced with a rich media experience. This would mean changes in the editorial processes, but the magazine business as we know it would continue to flourish.

What do you think will happen to magazines?

The day’s sessions – vigorously moderated by the Deputy Sales CEO of Argumenty i Facty Publishing House, Marina Mishunkina – included the following presentations:

• Market & Trends: Media Advertising Market, results of H1 2010 by Lilia Vladimirova, TNS Media Intelligence
• Prospects for Advertising in Print Media by Marina Mishinkina, Argumenty i Facty Publishing House
• Positive & Negative Attributes of Newspaper Advertising by Violeta Rodionova, ZenithOptimedia
• Trend Formers & News Media Advertising by Georgy Mikaberidze, AFS – IMG PH
• A New Era of Classified Advertising by Clara Llamas, Vaibmu Ltd.
• Russian Digital Classified Ad Market by Sergey Osipov, Delovoy Mir Publishing House
• The Potential of Free Advertising Information Press by Alina Diokonova, VA-Bank
• Special Interest Media: New Forms of Interaction with Advertisers by Lidia Strekneva, GameLand
• New Models of Advertising & 3D by Dmitry Ogurstov, Komsomolskaya Pravda Publishing House
• Marketing 360: Complex Ad Campaigns Using Events by Anton Shishkin, Metro Newspapers Russia

You may download Vaibmu’s presentation in English here and in Russian here.

Corporate Entrepreneurship, Teams: Types, Roles and Performance and Getting the Right Things Done.

Vaibmu organized a workshop at ICMA‘s Business Operations Forum in Vienna, Austria (Nov 6, 2010). There were three teams of 5-7 people. The team members were from different companies and countries. Naturally, none of them had been working together before. These diverse teams were given a challenging task that they were expected to execute successfully:

Develop, launch and market a real working classified advertising online site within five hours and, when finished, make a 10 minute investor pitch to sell your booming business!

To earn full points at the end of the day, the teams had to have a valid and working revenue model, at least 100 unique items in the database, and 100 unique visitors. Quite a challenge!

The Results

All the teams were able to launch and market their site within the time limitation. All of them were able to attract visitors with multiple methods and one of the teams successfully completed all the given milestones with their Just Dogs site.

Click the thumbnails below to see the two top sites of the day. They are true online classified advertising sites.

See more photos of the Vienna workshop here.

The Takeaways

In this workshop, we had five underlying themes that we emphasized throughout the day. However, to put the focus on the important issues, we provided pre-reading material before the day, rather than simply start working together. On the day of the workshop, this meant that the amount of academic discussion was almost zero and we succeeded in spending the whole day learning by doing.

The key takeaways were:

• Understand the mindset of start-up entrepreneurs – yes, they are the same guys who are planning to enter your markets!
• Success factors of an efficient team
• Roles in a team
• How to get the right things done
• Cross-cultural and cross-organizational team building

Organize This Workshop in Your Company

If you find the above mentioned takeaways useful for your organization, please download the brochure and  contact Vaibmu to have the workshop tailor made for your needs. It takes approximately 6 to 8 hours and the preferable amount of participants is 12-25 from your and your partners’ organizations.

As an industry organization GIPP’s main goal is to create favorable conditions for the development of the publishing business in Russia. GIPP was established 1998 and is a certified member of the World Association of Newspapers (WAN) since 2002. More than 2,500 media and publishing professionals will attend this edition of the GIPP Publishing Expo in Moscow’s centrally located Swissotel Krasnye Holmy.

Vaibmu welcomes new advisory board members, media entrepreneur Carlos Maier Allende (MBA) and international lawyer and media specialist Hakan Hanli (PhD). Read more about them.

Opportunity mapping: Quantifying the market opportunity by taking a good look at the competitive landscape.

Planning: Making an executable and financially sane plan that will seize the opportunity.

Execution: This is the moment, when strategy becomes real. You execute the plan, follow the results and act accordingly.

Each module inside the above mentioned phases gradually builds the way to successful strategy execution, whether it is in your domestic market or in a completely new geography. Go to the Services page to read more.

DigitalTonto has made a blog entry about 4 Unlikely Digital Heroes which is an interesting read (and I am not saying this just because our company is featured in it!). The post reviews 4 companies that are quietly making huge steps in digital, also giving credit to the 2010 ICMA Classified Media Innovation Award which Vaibmu Ltd. has created for the International Classified Media Association and which pays tribute to companies in the classified media space who are innovating. As we noted in a previous entry and in our report with all the finalists ideas and projects, a lot of great product and strategy development is coming from traditional print publishers in digital media worldwide.

If you have a few minutes, be sure to read his insight about Time Warner, Condé Nast and Naspers as well as the Polish analytics company Gemius.