November 2015 – Value Proposition Design by Alex Osterwalder, Yves Pigneur, Greg Bernarda & Alan Smith

Value Proposition Design

Value Proposition Design by Alex Osterwalder, Yves Pigneur, Greg Bernarda & Alan Smith

Learn how to create products and services that customers really want.

In 2010, Swiss entrepreneur Alex Osterwalder and Professor Yves Pigneur published a book called Business Model Generation. With it they launched the widely acclaimed Business Model Canvas, a tool that no self respecting entrepreneur should be with without. Building on this and as their value creation thinking evolved they more recently published, along with co-authors Bernada and Smith, a book called Value Proposition Design (accompanied by another canvas, the Value Proposition Canvas).

It’s a striking book with a design led contemporary feel and you really get the sense that Alex Osterwalder et al practice what they preach. With exciting and well designed imagery and with a judicious use of words they have produced an accessible and excellent business toolkit for customer value creation.

So what is meant by Value Proposition Design? Value Proposition is simply defined as describing ‘the benefits customers can expect from your products or services’. Creating Value is described as designing value proposition benefits to attract customers. This process is represented by the left hand side of the Value Proposition Canvas. The right hand side of the canvas is a powerful customer profiling tool for observing customers, it involves identifying ‘customer characteristics that you assume, observe, and verify in the market’. However, this powerful canvas only represents the starting point of the four stage journey this book takes your business on: Canvas, Design, Test and Evolve.

The Design section empowers you to generate ideas, gain customer insights, make choices and then develop and prototype propositions. Moving on to the test phase you can choose from an an extensive experiment library in order to go about validating your ideas and designs. How about trying out an MVP (that’s Minimum Viable Product for those that didn’t read last month’s book review), or maybe a storyboard, a split test or even a pop-up style life size experiment? Resources such as Test Cards and Learning Cards are shared along with further techniques for validation and then bringing it all together.

Iteration is also encouraged at every waypoint and speedy repetition of the journey is actively encouraged to optimise the prospects for moving your business value offerings forward.

As well as introducing cutting edge ideas this book does a great job of dovetailing with the work of other innovators such as Eric Ries, Edward de Bono, Steve Blank and Luke Hohmann. It soon becomes clear that this book is right at the forefront of the simplification of business management thinking, it makes potentially complex topics very easy to follow, positively overflowing with innovative and lateral thinking that entices you to read more. You can even take things online by visiting the accompanying web pages to download tools, templates and posters and try out online tools.

We’ve seen this book used coffee book style as something to dip in and out of for inspiration, as a reference book for techniques and even as a support tool in business workshops. Equally though it is a real page turner when read cover to cover, although by the end you do feel like reading it all over again due to the sheer amount of fresh thinking and knowledge imparted.

So if your business is working on how to understand what your customers really want then this is probably the best book you can find on this topic.

A quote from the book to end on, and one that neatly summarises it’s overall approach is

‘Launching ideas without testing is wishful thinking. Testing ideas without launching is just a pastime.’

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To celebrate Exeter library’s new found status as a Business and Intellectual Property Centre we’re hand picking a selection of stimulating business reads for review, this month we are highlighting a recent title that quickly became a bestseller and has the power to transform your business thinking.

If you’ve read Business Model Generation, used the Business Model Canvas or read Value Proposition Design and have any comments, experiences or connected stories to share then please do so via social media using #businessbookreviews (@BIPCExeter on Twitter).

Click here to search the library catalogue.

Click here to last month’s Business Book Review ‘The Lean Start-Up’.

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