Why do you also need to know BMC(Business model canvas)

Credit to
Strategyzer Youtube channel

BMC is a canvas that covers the essence of the business plan and usually, it created in the early time as the business started and updated with time goes by. People may ask why is it related to social innovation? Actually, BMC is also the tool to help social innovation feasible with limited resources and it ensures a good ratio of success.

The nine parts of BMC are shown in that video above so I will explain to you more with my personal understanding.

Key partners are individuals or a group of people or organizations that have a similar vision with your business. For example, my business is fighting poverty, which is one of the missions of the world bank, so world bank can be my partner. It has to point out that partners and you are in a win-win situation, which means both of you should benefit from this partnership and the partner has a role to play in your business.

Key activities are a series of actions needed to be taken through the business process. You have to ask yourself what actions should you take to make the business happen and grow as well.

Key resources are those resources you need, it may include physical resources (office or stationery etc), human resources (team members or volunteer or consultant etc) and intellectual resources (for example the copyright etc).

Value proposition defines what makes your business special. Specifically, what the business can offer to address the pain your customers have and what gain they will get from your business. This is the whole customer-centered driven approach, to look into what does the customer really want but also beyond the real demand.

Customer relationship is all about what kind of relationship is between your business and the customers. it is also about how to get, keep and grow customers through your business strategies.

Channels are strategies to reach to customers and deliver services&products as well. Physical and digital channels are two popular ways, but apparently, the digital has many advantages nowadays. It is important that you have to consider your targeted group, to find out what channel is preferred by them.

Customer segment is to specify what group of people your business is serving. It may consider from the location, income level, age, marital status and etc.

Revenue structure focuses on how does your business generates money. It may come from direct sell, patent or donation etc.

Cost structure lies in the direct or indirect costs that your business makes. Normally, costs are those tangible costs(physical costs, things like office rent, computer, table etc) or intangible costs(internet fees, electricity fees etc).

Those nine parts are used mostly in the business sector and they also call it lean startup canvas. It is the summary of your whole business plan and once you come up with a BMC, the next step is to try it out with minimal resources and time, which is much cost-effective compared with the old fashion, and it works like the prototype process, but this time you are trying the whole business as a prototype. If you want a full explanation then you can also click here.

In the social innovation sector, we use another canvas which is similar to BMC, that is the social lean canvas. It is mostly lean on how your social innovation will address social problems and what is the impact of your solution.

This canvas is more clear on social impact and helps you to identify social problems and social impacts deeply. I will display you those parts which are excluded from BMC.

Purpose is a guiding principle for the development of this canvas, which clearly defined what is the vision or mission of this social innovation. I can say it includes the problem statement, vision, and mission statement together.

Problem helps you questioning what are the problems your customers are facing, this is different from the problems on that purpose box. What are those pain points and how are those problems affecting your customers and bonus point if you also add how those problems handled currently?

Solution is more focus on your social innovation solution. What are your solutions and how your solution will deliver value to your customers?

Key metrics are those key numbers that suggest whether your social innovation succeeds or fails which is also equal to KPI. For example, the poverty-fighting organization sets the income generation number for reference, to see how much income has generated through its organization.

Unfair advantage tells people why should your social innovation succeed, you may tag with what unique resources do you have, what are components of your team, what relationship do you have with your customers etc.

Financial sustainability has a funding model except for the revenue model we have in BMC. The funding model is special for social innovation, due to the initial capital from individuals or organizations. Noted that it also includes the ownership structure for this social innovation.

Impact responds to what social or environmental impact will come out and how your beneficiaries will benefit from this result. It can extract metrics from Key metrics, mainly to show how those results will be measured and why they indicate a specific impact.

Photo by RODNAE Productions on

We are standing on the giant’s shoulder. Those canvases help us to refine and improve our social innovation and also identify the market fit hence ensure social and financial sustainability. And this canvas may implement in somewhere else, actually when I was in Uganda, one of my classmates started to analyze herself with BMC, which was an incredible idea and I admired her ideas. You can try it out starting from yourself and then your social innovation.

This article was edited by the original author without their consent, and should not be reproduced.

By Social Innovation Insight

We are the bridge of change!

6 replies on “Why do you also need to know BMC(Business model canvas)”

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