Visual Business Model Map
Relationship Model
Attributes to determine the best-fit Relationship model
Transactional Contract
Relational Contract
Investment
Overall cost In switch suppliers
Low
Low
Medium
Medium to High
High
High
Physical asset specificity (location, machinery, processes)
Low
Low
Medium
Medium to High
Medium to High
High
Skill level needed for predominant personnel
Unskilled
Semi-skilled
Skilled
Professional
Professional
Expert
Level of supplier integration/interface required (systems, support processes)
None
Low
Medium
High
Very High
Critical
Overall availability of service/product in marketplace
Widely Available
Widely Available
Moderate Availability
Limited number of capable suppliers
Limited number of capable suppliers
Scarcely Available
Availability of qualified and skilled personnel
High
High
Medium
Low
Low
Low
Availability of required technology
Universal
Limited
Restricted
Restricted to Scarce
Scarce
Unique
Access to buyer's systems and critical processes
None
Low
Medium
High
Very High
Critical
Product/service is strategic differentiator or core competency for buyer
No
No
No
Possible Strategic Differentiator
Strategic Differentiator
Core Competency
Profit impact from the buyers perspective (volume purchased, % of total purchased costs, impact on business growth)
None
Low
Medium
High
Very High
Critical
Product/service delivery failure impact on end customer/brand experience
None
Low
Medium
High
Very High
Critical
Product/service delivery failure impact on internal customer experience
None
Low
Medium
High
Very High
Critical
Regulatory compliance policy
Meet Standard
Meet Standard
Meet Standard or Higher
Meet Standard or Higher
Meet Standard or Higher
Meet Standard or Higher
Uncertainty of demand
N/A
Manage unanticipated demand spikes with multiple sources
Provider response to unanticipated volume spikes limited
Contractual ability for supplier to respond to spikes
Contractual flexibility for supplier and client to respond to spikes to optimize the business
Capacity is set based on captive assets + using market if not asset specific
Economy Model
Attributes to determine the best-fit Economic Model
Transactional-Based
Output-Based
Outcome-Based
Potential efficiency gains
None
Low
Medium
High
Very High
Significant
Potential for revenue increase
None
Low
Medium
High
Very High
Constant
Potential for innovation
None
Low
Medium
High
Very High
Critical
Size of investments needed to achieve outcomes (buyer or supplier)
Low
Medium
High
High to Invest
Invest
Invest
Degree of supplier control over outcome
Low
Low
Low
High
Medium-High
N/A
Type of success measure desired/required
Transactional Task Metrics
Transactional Task Metrics
Transactional Task Metrics
Output SLA Metrics
Strategic KPI or Business Outcomes
Strategic KPI or Business Outcomes
Ease at which task/workscope can be specified
High
High
Medium
Medium
Can Vary
Very Difficult or Impossible
Risk related to operational safety
Minimal
Low
Medium
High
High
Critical
Risk related to operational reliability
Minimal
Low
Medium
High
High
Critical
Financial risk tolerance for buyer
High Risk
High Risk
Medium Risk
Medium-Low Risk
Shared Risk
N/A
Financial risk tolerance for supplier
Low Risk
Low Risk
Low Risk
Medium Risk
Shared Risk
N/A
Relationship Model
| Attributes to determine the best-fit Relationship model | Transactional Contract | Relational Contract | Investment | |||
|---|---|---|---|---|---|---|
| Overall cost In switch suppliers | Low | Low | Medium | Medium to High | High | High |
| Physical asset specificity (location, machinery, processes) | Low | Low | Medium | Medium to High | Medium to High | High |
| Skill level needed for predominant personnel | Unskilled | Semi-skilled | Skilled | Professional | Professional | Expert |
| Level of supplier integration/interface required (systems, support processes) | None | Low | Medium | High | Very High | Critical |
| Overall availability of service/product in marketplace | Widely Available | Widely Available | Moderate Availability | Limited number of capable suppliers | Limited number of capable suppliers | Scarcely Available |
| Availability of qualified and skilled personnel | High | High | Medium | Low | Low | Low |
| Availability of required technology | Universal | Limited | Restricted | Restricted to Scarce | Scarce | Unique |
| Access to buyer's systems and critical processes | None | Low | Medium | High | Very High | Critical |
| Product/service is strategic differentiator or core competency for buyer | No | No | No | Possible Strategic Differentiator | Strategic Differentiator | Core Competency |
| Profit impact from the buyers perspective (volume purchased, % of total purchased costs, impact on business growth) | None | Low | Medium | High | Very High | Critical |
| Product/service delivery failure impact on end customer/brand experience | None | Low | Medium | High | Very High | Critical |
| Product/service delivery failure impact on internal customer experience | None | Low | Medium | High | Very High | Critical |
| Regulatory compliance policy | Meet Standard | Meet Standard | Meet Standard or Higher | Meet Standard or Higher | Meet Standard or Higher | Meet Standard or Higher |
| Uncertainty of demand | N/A | Manage unanticipated demand spikes with multiple sources | Provider response to unanticipated volume spikes limited | Contractual ability for supplier to respond to spikes | Contractual flexibility for supplier and client to respond to spikes to optimize the business | Capacity is set based on captive assets + using market if not asset specific |
Economy Model
| Attributes to determine the best-fit Economic Model | Transactional-Based | Output-Based | Outcome-Based | |||
|---|---|---|---|---|---|---|
| Potential efficiency gains | None | Low | Medium | High | Very High | Significant |
| Potential for revenue increase | None | Low | Medium | High | Very High | Constant |
| Potential for innovation | None | Low | Medium | High | Very High | Critical |
| Size of investments needed to achieve outcomes (buyer or supplier) | Low | Medium | High | High to Invest | Invest | Invest |
| Degree of supplier control over outcome | Low | Low | Low | High | Medium-High | N/A |
| Type of success measure desired/required | Transactional Task Metrics | Transactional Task Metrics | Transactional Task Metrics | Output SLA Metrics | Strategic KPI or Business Outcomes | Strategic KPI or Business Outcomes |
| Ease at which task/workscope can be specified | High | High | Medium | Medium | Can Vary | Very Difficult or Impossible |
| Risk related to operational safety | Minimal | Low | Medium | High | High | Critical |
| Risk related to operational reliability | Minimal | Low | Medium | High | High | Critical |
| Financial risk tolerance for buyer | High Risk | High Risk | Medium Risk | Medium-Low Risk | Shared Risk | N/A |
| Financial risk tolerance for supplier | Low Risk | Low Risk | Low Risk | Medium Risk | Shared Risk | N/A |