The big idea: The Business Model Canvas puts a whole model on one page in nine blocks, so your team can show how your innovation creates value, delivers it and pays for itself, and spot where the pieces do not fit.
In 60 seconds
- The canvas shows how an organization creates, delivers and pays for value in nine blocks.
- Whoever pays is a customer too, so put funders on the canvas as their own segment.
- Every block should connect: each segment gets value, and each cost ties to a resource or activity.
Do this: build current and future state canvases for your client and turn them into the deployment plan in your report.
How the Business Model Canvas works
The Business Model Canvas shows how an organization creates, delivers and pays for value on one page, in nine blocks. Your client already has a business model, even if it is a hospital unit, a city office or a nonprofit. Your job is to show how your innovation fits into it or changes it.
Right side: value for people
Customer Segments, Channels and Customer Relationships. Who it is for and how you reach and keep them.
Asks: is this desirable?
Center: the value proposition
What you do for each segment. The bridge between the two sides.
Asks: why would anyone choose this?
Left side: making it happen
Key Partners, Key Activities and Key Resources. What it takes to deliver.
Asks: is this feasible?
Bottom: the money
Cost Structure and Revenue Streams. What it costs and who pays.
Asks: is this viable over time?
The nine blocks in plain language
Fill them roughly in this order. Each example comes from one invented case: a hospital discharge coaching program for heart surgery patients.
1. Customer Segments
Who do we create value for? List each group separately.
Example: patients going home after surgery, family caregivers, hospital leadership who funds it.
2. Value Propositions
What problem do we solve or need do we meet for each segment?
Example: a clear first-week plan and one nurse to call.
3. Channels
How each segment hears about it, gets it and gets help after.
Example: bedside visit before discharge, text check-ins.
4. Customer Relationships
What kind of relationship each segment expects: self-serve, personal help, a community.
Example: a personal coach for 30 days.
5. Revenue Streams
Who pays, for what and how. In public and nonprofit work, this is funding: budgets, grants, fees, donations.
Example: the hospital’s quality improvement budget.
6. Key Resources
What we must have: people, physical things, know-how and data, money.
Example: discharge coaches, a texting platform, records access.
7. Key Activities
What we must do every day or week to deliver the value.
Example: coach visits and follow-up calls.
8. Key Partners
Who outside the organization supplies an activity or resource, and why they help.
Example: community pharmacies deliver the first refill.
9. Cost Structure
The biggest costs, tied to the resources and activities that cause them.
Example: coach salaries, texting fees.
Whoever pays is a customer too
In many capstone projects the people who use a solution are not the people who pay for it. A city council funds a service residents use. A hospital budget pays for care patients receive. Put the payer on the canvas as its own segment and give them a value proposition, or the model has a hole.
The Business Model Canvas was created by Alexander Osterwalder and Yves Pigneur and is published by Strategyzer AG under a Creative Commons Attribution-ShareAlike 3.0 license (CC BY-SA 3.0 (opens in a new tab)). The plain-language block questions here are adapted from the canvas and its prompts in your course materials.
Prompts and categories for each blockThe canvas’s own vocabulary, explained
| Block | Categories to consider |
|---|---|
| Customer Segments | Mass market, niche market, segmented, diversified, or a multi-sided platform (two or more groups that need each other, like riders and drivers). |
| Value Propositions | Newness, performance, customization, getting the job done, design, brand or status, price, cost reduction, risk reduction, accessibility, convenience and usability. |
| Channels | Which channels each segment prefers, how you reach them now, which work best and cost least, and how they fit into people’s routines. |
| Customer Relationships | What each segment expects, which relationships already exist, how they fit the rest of the model and how costly they are. |
| Revenue Streams | Types: asset sale, usage fee, subscription, lending or renting or leasing, licensing, brokerage fee, advertising. Pricing can be fixed (list price, by feature, by segment, by volume) or dynamic (negotiation, yield management, real-time market). |
| Key Resources | Physical, intellectual (brand, patents, copyrights, data), human and financial. |
| Key Activities | Production, problem solving, or running a platform or network. |
| Key Partners | Why partner: to optimize and gain economies, to reduce risk and uncertainty, or to get particular resources and activities. |
| Cost Structure | Cost-driven (lean, low price, automated) or value-driven (premium, focused on value). Fixed costs (salaries, rent, utilities), variable costs, economies of scale and of scope. |
How the blocks talk to each otherThe consistency checks behind the lab
A canvas is not nine separate lists. Each block should connect to others. Trace these lines:
- Segment to value. Every segment gets a value proposition, a channel and a relationship. If a segment gets nothing, why is it there?
- Value to payment. Every revenue or funding line comes from a segment on the canvas, and that segment gets real value.
- Value to delivery. Every value proposition needs activities and resources to deliver it.
- Delivery to cost. Every key resource is either paid for in Cost Structure or provided by a partner.
- Partner to purpose. Every partner supplies a named activity or resource.
Use two colors of sticky notes: one for how the client works today and one for what your innovation adds or changes. The difference is your recommendation.
Map the world around your canvasStrategyzer’s Business Model Design Space card deck
Strategyzer’s Design Space card deck in your course materials is a team workshop for mapping what is happening around a business model. Put your client’s canvas in the middle of a wall and work through four areas of cards around it, using notes, photos, data and printouts as evidence. The deck suggests 4 to 8 people and a 2 to 4 hour session.
Industry Forces (left)
Competitors, new entrants, substitute products and services, stakeholders, suppliers and other value chain players.
Market Forces (right)
Market issues, market segments, needs and demands, switching costs, revenue attractiveness.
Key Trends (top)
Technology, regulatory, societal and cultural, and socioeconomic trends.
Macroeconomic Forces (bottom)
Global market conditions, capital markets, commodities and other resources, economic infrastructure.
For a capstone team, the most useful cards are usually substitutes (what people use today instead of your idea), stakeholders, needs and demands, and regulatory trends. A light version: give each teammate one area, 20 minutes, and three notes to bring back.
Do this, not thatHabits of a canvas a client trusts
Do this
- One idea per note, a few words each.
- Separate segments that need different things.
- Put funders and payers on the canvas as segments.
- Tie every cost to a resource or activity.
- Show today’s model and your changes in different colors.
Not that
- Paragraphs crammed into blocks.
- “Everyone” as a customer segment.
- A revenue block that says “free” with no funder.
- Partners listed because they sound impressive.
- A canvas the client contact has never seen.
Try it: Nine-Block Canvas Builder
Tool · BUAD 497
Nine-Block Canvas Builder
Build your client’s business model and see where the blocks do not fit together.
- 1Add notes
- 2Link
- 3Share
Pick a block
Core value proposition
All consistency checks
Your canvas
Canvas layout: the Business Model Canvas by Strategyzer AG (Alexander Osterwalder and Yves Pigneur), licensed CC BY-SA 3.0.
Put it to work: the deployment plan in your report
The Business Model Canvas is part of the Implementation phase that kicks off in December. In spring it becomes the deployment plan in the Research Implementation Phase of your HCD Technical Report and one of the business tools that support your Desirability, Viability, Feasibility, Sustainability and Ethics section. A simplified version can support the business potential statement in your Executive Summary and your EUReCA poster.
Map today’s model
Fill the nine blocks for how your client works now, in the area your challenge touches.
Your deliverable: a current-state canvas your client contact has checked.
Add your innovation
In a second color, add or change notes to show what your prototype adds: new segments, channels, activities, partners, costs and funding.
Your deliverable: a future-state canvas with changes highlighted.
Run the consistency checks
Use the Canvas Builder to find segments with no value, payers who are not on the canvas and costs with no cause.
Your deliverable: a list of fixes and open questions for your Weekly Consulting Brief.
Test your riskiest block
Pick the block you are least sure of, often funding or partners, and check it with the person who would know.
Your deliverable: one sentence of evidence for that block.
Put it in the report
Rebuild the canvas as a clean figure, credit Strategyzer, and write a short paragraph on what changes and why it is viable.
Your deliverable: the Deployment Plan (Business Model Canvas) figure and paragraph in your HCD Technical Report.
Before you submitCheck your canvas
- [ ] All nine blocks are filled with short notes.
- [ ] Every segment has a value proposition, a channel and a relationship.
- [ ] Whoever pays or funds it is a segment with its own value proposition.
- [ ] Every key resource is paid for or provided by a partner.
- [ ] Every cost is tied to a resource or activity.
- [ ] Changes from today’s model are clearly marked.
- [ ] The figure credits the Business Model Canvas by Strategyzer AG (CC BY-SA 3.0).
Go deeper
Back to all BUAD 497 topics · Next: The Value Proposition Canvas
In-class team activity · 30 min
Canvas vs. the Bot
By the end: A first future-state Business Model Canvas for your client project, checked for consistency and compared against an AI-generated version. Your instructor will give you the password in class.
Part of the Smith GLS human-centered leadership sequence: IB 407, BUAD 317 and BUAD 497, toward the Human Centered Consulting Certificate.
Frequently asked questions
What is the Business Model Canvas?
The Business Model Canvas is a one-page tool that shows how an organization creates, delivers and pays for value in nine blocks. It was created by Alexander Osterwalder and Yves Pigneur and is published by Strategyzer AG. The right side covers value for people, the center holds the value proposition, the left side covers delivery, and the bottom covers costs and revenue.
What are the nine blocks of the Business Model Canvas?
The nine blocks are Customer Segments, Value Propositions, Channels, Customer Relationships, Revenue Streams, Key Resources, Key Activities, Key Partners and Cost Structure. Together they answer who you create value for, what you offer, how you reach and keep people, who pays, what it takes to deliver and what it costs. Filling them roughly in that order keeps the model tied to people first.
How do you use the Business Model Canvas for a nonprofit or public organization?
Treat funding as your revenue stream: budgets, grants, fees and donations. In many public and nonprofit projects, the people who use a solution are not the people who pay for it, such as a city council funding a service residents use. Put the payer on the canvas as its own customer segment with its own value proposition, or the model has a hole.
What are common Business Model Canvas mistakes?
Common mistakes include cramming paragraphs into blocks, listing "everyone" as a customer segment, a revenue block that says "free" with no funder, partners listed because they sound impressive, and a canvas the client has never seen. A strong canvas uses one short idea per note, ties every cost to a resource or activity, and shows changes from today's model in a different color.
How do you check whether a Business Model Canvas is consistent?
Trace the connections between blocks. Every segment should get a value proposition, a channel and a relationship. Every revenue or funding line should come from a segment that gets real value. Every value proposition needs activities and resources, every key resource is paid for or provided by a partner, and every partner supplies a named activity or resource.