Module 6: Making decisions
6.1 Themes & learning outcomes
Themes
Business modelling
Deep democracy
Intended learning outcomes
After finishing this module you will be able to:
Design a complete offer – a business model – that will create value for stakeholders and customers
Help the team move forward by articulating the merits of alternative ideas or proposals
Engage team members in ways that facilitate their contributions in making decisions by both constructively building upon the contributions of others as well as noticing when someone is not participating and inviting them to engage
Time required: 3-5 hours
6.2 Introduction
Bringing it all together
It’s time to put it all together. Up until now you have come up with an idea and tested it on some of your stakeholders. You are also familiar with different ways to acquire the resources you need to pursue your venture. This module offers knowledge on how to design a complete offer. You will need to develop some processes and some crucial relations in order to succeed. These need to be aligned to your stakeholders’ needs and wants, and to the way you intend to acquire resources. Like an architect puts all the pieces of a house (roof, walls, windows, etc.) together in different ways, you can design your offer in different ways. To help you do that, you will be introduced to the “Business Model Canvas”. You will combine what you have learned in the previous modules with the additional knowledge presented here to help your team finalise its business model. During the module you will work with canvases which tackle specific segments of business modelling, including revenue streams, strategic partners, key resources, among others. In the creation of the business model there are a lot of decisions to be made!
That is why this module also builds upon the principles of Deep Democracy, a strategy of decision-making which leads to broad support across a group, and where both the majority and minority have control over the decision-making process.
The techniques within Deep Democracy ensure that as many voices as possible, including the opinion of the minority, are heard. This way, the potential of a group is fully utilised. Because all expertise and knowledge of the group is bundled together, sustainable decisions are made.
For the purposes of this module, the theory of Deep Democracy will be restricted to 4 steps of the Lewis method (aka lowering the water line). They are:
Collect all perspectives
Actively search for the alternative
Spread the alternative
Add the knowledge of the minority to the decision of the majority
6.3 Warm-up
You have selected a Global Challenge to work on and have begun to develop an idea which will help to address the challenge. In this warm-up exercise, you will think through your idea once more.
Step 1: Evaluating
In the first step of this warm-up exercise, go to the link below from Entrepreneur.com and individually answer the questions:
https://www.entrepreneur.com/article/81940
Don't forget to take notes as you will discuss your answers with your team afterwards.
Step 2: Sharing
Once everyone has completed the individual warm-up, the team should come together in a virtual session. Firstly, the group must agree upon a member to lead the session. The leader will ask each group member to share an idea on the basis of the questions you previously answered individually.
The leader will share their idea first and then employ the 'popcorn' method. In the popcorn method, participants share their thoughts only when they are ready to. The leader listens actively but remains neutral. Once everyone has had the opportunity to speak, the leader will provide a summary of all the thoughts and ideas that were shared.
Write down the summary and save it for later. You will need it in the following sections of the module.
6.4 Advice & “know-how”
Testing your business model
The Business Model Canvas is a strategic management and entrepreneurial tool. It allows you to describe, design, challenge, invent, and pivot your business model. You can view the business model canvas at the link below:
https://assets.strategyzer.com/assets/resources/the-business-model-canvas.pdf
Now that you've seen the canvas, watch this introductory video to learn more about the different building blocks of the Business Model Canvas:
As you may have noticed, some of the pillars have already been introduced at other points within this course. The Business Model Canvas will help you to bring them together. But – before attempting to create a canvas for your idea, work through the links below to understand and learn how to develop the remaining pillars of the Business Model Canvas.
The final pillars of the Business Model Canvas
The pillars are presented from a very business oriented perspective. Don’t think that this is irrelevant if you work with a more idealistic or not-for-profit idea! Remember that you still have key activities to perform, partners to team up with, resource needs, costs, and a need to reach your stakeholders. Since nothing comes entirely for free, you will also need some revenues to cover your costs. The revenues may come from different sources (not necessarily customers) – be creative!
While reading take some notes on how this applies to your idea!
Key activities: https://strategyzer.uservoice.com/knowledgebase/articles/1194361-how-do-i-use-the-key-activities-building-block-of
Revenue Streams: https://strategyzer.uservoice.com/knowledgebase/articles/1194385-how-do-i-use-the-revenue-streams-building-block-of
Cost structure: https://strategyzer.uservoice.com/knowledgebase/articles/1194382-how-do-i-use-the-cost-structure-building-block-of
Reaching your customers: https://strategyzer.uservoice.com/knowledgebase/articles/1194376-how-do-i-use-the-channels-building-block-of-the-bu
Making it all work as a group
After researching your idea through various canvas exercises, it is almost time to discuss your idea with your team members. When you discuss with your team, be open to alternative opinions to improve the overall concept and be mindful of how the group is making a decision.
To make a decision and ensure that all voices within the team are heard, you should follow these 7 steps.
After reading through the steps, try to identify the step numbers:
Organise the first public vote; everyone can vote more than once: ___
Summarise all proposals: ___
Ask for opposing opinions: ___
Invite everyone to make a proposal: ___
Ask “no-voters“ about conditions to adjust the winning proposal: ___
If the desired level of majority vote isn’t reached after the second vote, return to step…: ___
If the group does not reach a unanimous decision, continue to step…: ___
Form a new proposal based on conditions: ___
Organise a second vote; members can vote for more than one proposal: ___
Exercise: How to make a group decision
For this exercise, picture the following situation:
A team of 5 volunteers (Paula, Bart, Aashima, Li and Jen) work for Greenpeace and their supervisor Jasna wants to reward one of them with a gift voucher. The team gets to decide for themselves who should earn the reward and the supervisor uses Deep Democracy to help them make a sustainable decision.
Exercise: Try to match the team interactions with the correct step of the Deep Democracy decision-making process.
Invite to make a proposal
Ask opposing opinions
Summarise all proposals
First voting round
Ask no-voters for conditions
Form a new proposal
Second voting round
A. If I listened carefully, we are choosing between Bart and Paula?
B. Who votes for Paula if Bart gets the reward next time?
C. Aashima, what could we do to help you vote for Paula?
D. Tell me, who should get the reward?
E. Aashima, I see you nodding your head, you would not choose Paula?
F. So who chooses Paula?
G. So you think Paula is a good candidate if Bart receives the reward next time?
6.5 Resources
Lewis, M. (2008). Inside the NO – Five Steps to Decisions that Last. eBook.
Magretta, J. (2002) “Why Business Models Matter." Harvard Business Review 80, 5, 86-92.
Morris, M., M. Schindehutte, and J. Allen. (2005). "The Entrepreneur’s Business Model: Toward a Unified Perspective." Journal of Business Research 58, 726-735.
Yang L and Wei Jiang. (2013) "Business Modeling for Entrepreneurial firms: Four Cases in China." Chinese Management Studies 7(3), 344-359.
6.6 Challenge
In this challenge, each of you in the team should individually design a Business Model Canvas based on the team’s idea. Use the knowledge that you’ve gained in the previous sections. If you lack some information needed to complete the canvas, try to find it! Search the Internet, talk to people who might know, look into statistics, or read some literature. The idea put forward in the Business Model Canvas should be possible to realise!
Build a Business Model Canvas based on your team's idea. Use the template from strategyzer.com and save your results.
Next is a team assignment that will build on your different canvases.
6.7 Team assignment
Now it is time to identify your team’s business model!
As a team, follow the steps below.
Step 1: Share and discuss
Share and discuss the individual Business Model Canvases that you created in the previous section.
Step 2: Vote a winner
Now vote to select the best proposal for your idea.
For this, first assign a team leader who will lead the discussion. Decide as a group at what level of consent is needed to commit to the final decision (100%, 80%, etc.). If you agree to 100% it means that all members of your team will need to agree with the final decision.
The team leader is also able to vote, and everyone should vote at the same time. Please note that everyone in the group can vote for more than one proposal, and it is the proposal that gets the most votes that wins. Don't forget to follow the steps in the checklist "How to make a decision" and stop when you reach the agreed upon level of consent.
Step 3: Celebrate
Congratulate yourself for having completed the final product of this course! You have created a complete offer based on a Global Challenge – celebrate your efforts!
6.8 Reflection
Once you have completed the team assignment, it is time to think back to the work you have done and how your team managed the assignment. Your team was asked to make a few decisions and to reach a consensus.
Write down 10 ideas that come to mind when you try to answer the questions below.
Reflect on your choice - why was your final choice the best business model?
How did you manage to hear all the voices in the group?
What did you have to do to make it safe for your fellow group members to voice alternative ideas?
How did the Deep Democracy framework affect your decision making process?