Business model innovation is a necessity. The constant march of competition and time causes all business models to erode eventually — you can’t stand still and expect to get ahead. Regularly spend time updating your business model to get the most from your business. If you need innovation inspiration, look at other businesses.
Although you always want to keep an eye on your competition, don’t overlook completely unrelated businesses — sometimes the best ideas come from taking a piece of their business model and using it to improve your own. Consider the following checklist when trying to leverage business model ideas from other businesses:
Is their idea one that extends their existing model or changes it? Extensions are typically not as powerful as outright changes. Use the daring moves of unrelated businesses to inspire dramatic changes of your own.
Does their idea upsell additional customers or add new ones? It may be more profitable to upsell existing customers, but it’s harder to add new ones. Be on the lookout for creative ways to add new customers. For instance, the Dodge Dart Registry borrowed from the wedding industry to attempt to create new first-time car buyers.
Is the margin generated by this idea high or low? Borrow only the ideas that generate excellent margins. Not all sales are good sales.
How proprietary is the concept? When one car manufacturer has a terrific idea, if it works well then every other car company will copy it. Better to imitate ideas that have protection or are hard to emulate.
How much intellectual property and organizational learning would be required to copy the concept? Every day you see great ideas that you simply don’t have the resources to copy. Your business is unlikely to successfully borrow business ideas from Google and genome sequencing, so be realistic in your search.
If they would sell me this idea, how much would I pay? If you wouldn’t pay a lot for the idea, move on to one you would pay a lot for.
How faddish is the idea? By the time you emulate the idea, will the trend be over? Use your “crystal ball” to guess how long the trend will last. Looking in the rearview mirror isn’t that useful in this case.
What portions of their idea need to be ignored and what portions can be repurposed into my business? One hundred percent of an idea is never swipable. It takes only one percent of an idea working to make an impact in some cases. However, if too much of the concept needs to be repurposed, you may be better to find a different inspiration.
