Today I came across a blogpost from Dave Gray, Founder and CEO of XPLANE about "a brief history of LEGO" (disclosure: I admire Dave for his work in the domain of visual thinking ;-). LEGO always reminds me of two things: Firstly, I have to think about the great time I am having these days and weeks with my son who is currently discovering LEGO (yeah, it allows me to play without finding excuses :-) Secondly, I have to think about how similar business model design is to playing with LEGO.
For me, LEGO and business design are both about:
- Creative minds;
- Analytical and conceptual capacity to imagine the ouctome;
- Putting building blocks together piece by piece to form a coherent whole;
- Understanding that it's the whole that counts, not the pieces.
A nice example of creating value block by block is Apple's business model design in the music industry. It is the whole that makes their business model powerful not the pieces - it is the iPod (hardware), iTunes (software & shop), the available music (content) and partners (content suppliers) combined that create a coherent whole and competitive advantage. Each business model building block alone is almost like the various shapes and colors of LEGO pieces:
- the iPod competes with various similar music players (i.e. LEGO pieces of same shape and color) - of which some have better performance and price/quality ratios;
- the iTunes online shop is only one of several music sites where a customer can download the latest tunes (i.e. LEGO pieces of same shape and color);
- the iTunes software competes with numerous other music software (i.e. LEGO pieces of same shape and color);
- Apple is not the only company that has struck a deal with music majors (i.e. LEGO pieces of same shape and color).
Apple's genius was to design a competitive business model from several pieces, that, each one taken alone, are similar to the others in their respective market. It's just like building a beautiful castle from a bunch of quite similar LEGO blocks...
PS: For more about LEGO and creativity have a look at Serious Play (wiki) developed at the IMD management School in Lausanne, Switzerland by Johan Roos and Bart Victor. Yep, we have a hotbed for creativity and business design here in the region ;-)