Photo by mk4oto
Key Definitions in the New Business Modelling Framework (NBM4)
| Term | Definition |
| Customer Development | Customer Development (CustDev) is testing an idea or prototype of a future product on potential consumers. Customer Development and Design Thinking share similar characteristics in exploring customer needs, but their origins, differences and speed in practice are very different. —Steve Blank.[1] |
| Design Thinking | Design Thinking is an approach to solving customer problems, starting with the ‘search for the need’ of the client to reduce the risk of creating a product that no one wants, involving rapid prototyping and learning. It is also described as a method of meeting people’s needs and desires in a technologically feasible and strategically viable way. Like User-centric design, it focuses on creating solutions that resonate with users. —Tim Brown.[2] |
| Digital | Made with digits, computers, and software. It refers to a binary number system, which is the internal language of computers, involving values of 0 and 1. |
| Digital Enterprise | An enterprise characterized by: Creation of digitalized products or services that are either delivered fully digitally (e.g., digital media or online banking), orWhere physical products and services are obtained by the customer by digital means (e.g., online car-sharing services). —DPBoK™, The Open Group.[3] |
| Digital Transformation | The radical, fundamental change towards becoming a digital enterprise. —DPBoK. Digital transformation transforms an organization’s core business to better meet the needs of new customers through new business models, digital technologies, and data. Digital Transformation as a project initiative involves a fundamental shift for a business from its current state (“as is”) to a digitally empowered state (“to be”). While digitization and digitalization help businesses move towards more modern practices, true digital transformation involves a complete shift in how a business operates, leveraging digital technology to generate new opportunities and value. |
| Digitalization | The application of digital technology to create additional business value within the primary value chain of enterprises. —DPBoK. |
| Digitization | The conversion of analog information into digital form. —DPBoK. |
| Platform | A digital environment that facilitates interactions between two (two-sided platforms) or more (multisided platforms) distinct user groups, usually consumers and producers, by creating value for all participants. There are two main types of platforms: Transaction platforms, which facilitate direct exchanges between users (e.g., e-commerce sites), and Innovation platforms, which enable third-party developers to create complementary products or services (e.g., app stores). —Andrei Hagiu.[4] |
| Platform Ecosystem | A multisided platform that connects multiple groups, enabling them to interact in a mutually beneficial way. It involves a unified IT infrastructure, openness, and win-win principles for all participants. —Rietveld, Joost, Melissa A. Schilling, and Cristian Bellavitis.[5] |
| Process | An ordered, countable set of activities; an event-driven, value-adding sequence that can be measured and improved. —DPBoK. |
| Product Management | Product management is an organizational function that guides every step of a product’s lifecycle — from development to positioning and pricing — by focusing on the product and its customers first and foremost. To build the best possible product, product managers advocate for customers within the organization and make sure the voice of the market is heard and heeded. —Atlassian.[6] |
| Product Model | An organizational function that guides the organization and management of the new product development (NPD) process, product teams, rapid planning, production, and launch. |
| Product | A product is any item or service you sell to serve a customer’s need or want. Products can be physical or virtual. —Aha![7] |
| Product Team | An autonomous team created for the long-term solution of customer problems with full responsibility for the creation, development, and management of the product. |
| Project | A temporary endeavor undertaken to create a unique product, service, or result. —PMI, PMBOK®.[8] The difference between a product and a project: a product is an ongoing value offering to customers, whereas a project is a one-time initiative to create a specific deliverable. |
| Transformation | The act of transforming or the state of being transformed. Business transformation, a major change in the identity, structure, or purpose of an organization (from the field of strategic management). From Ecclesiastical Latin: trānsfōrmātiō. —Wiktionary.[9] |
[1] Blank, Steve. “Driving Corporate Innovation: Design Thinking, Lean Startup, and Customer Development.” Steve Blank, 30 July 2014, https://steveblank.com/2014/07/30/driving-corporate-innovation-design-thinking-customer-development/.
[2] Brown, Tim. “Design Thinking.” Harvard Business Review, June 2008, https://hbr.org/2008/06/design-thinking.
[3] The Open Group. The Digital Practitioner Body of Knowledge™ Standard (DPBoK™). The Open Group, https://pubs.opengroup.org/dpbok/standard/definitions.html.
[4] Hagiu, Andrei. “Strategic Decisions for Multisided Platforms.” MIT Sloan Management Review, December 19, 2013, https://sloanreview.mit.edu/article/strategic-decisions-for-multisided-platforms/.
[5] Rietveld, Joost, Melissa A. Schilling, and Cristian Bellavitis. “Platform Strategy: Managing Ecosystem Value Through Selective Promotion of Complements.” Organization Science, vol. 30, no. 6, 2019, pp. 1232-1251, https://pubsonline.informs.org/doi/10.1287/orsc.2019.1290.
[6] Atlassian. “Product Management.” Atlassian, https://atlassian.com/agile/product-management.
[7] Aha! “What Is a Product?” Aha! Roadmapping Guide, https://aha.io/roadmapping/guide/product-management/what-is-a-product.
[8] Project Management Institute. “Understanding the Difference Between Programs and Projects.” PMI, https://www.pmi.org/learning/library/understanding-difference-programs-versus-projects-6896.
[9] “Transformation.” Wiktionary, https://en.wiktionary.org/wiki/transformation.