It’s time for you and your organization to rethink your business strategy.
This post will introduce a fascinating, far-reaching and beautifully designed book that will challenge the way that you create value for your clients and think about how you approach Building Information Modeling (BIM) and Integrated Design.
Changing times and the harsh new realities of doing business in the AEC industry requires all of us to get innovative.
BIM especially requires design professionals to be as creative in their business strategy as they are in the design of buildings.
Do you know for certain how you can get the most value for the work you are undertaking?
A refresher on the BIM Business Model
Obsolete AEC business models are being replaced by those driven by BIM and the collaborative work process enabled by the technology.
For a quick refresher on the current (old) AEC Business Model, turn here, the Introduction to the BIM Handbook.
There are of course several BIM business models – determined by what phases you work in and the chosen delivery method.
As Joseph Joseph presented at AU in 2009, “Companies often make the mistake of embracing Building Information Modeling (BIM) as yet another technology and tool. BIM is a complete process solution that integrates within an organization structure. BIM is a business decision that pushes the envelope and moves companies in the AEC industry out of their comfort zone to explore new ways of writing proposals, budgeting, staffing, and billing jobs in a revamped approach.”
Here’s a free 19 page handout from his presentation.Another author with the initials JJ offers a number of BIM business strategies noting that “BIM can be used at different levels to suit a firm’s business model and client needs. No matter how far you go with the technology, you can recognize benefits by addressing its capabilities and risks in both business strategy and organizational culture.”
You can find James Jonassen’s excellent article here at DesignIntelligence covering the following BIM business strategies:
• BIM through design only
• BIM through construction only
• BIM in design-build
• BIM in integrated project delivery
• BIM in enterprise/project integration
You might recall Jonassen is the author of AIA’s seminal Changing Business Models in BIM-Driven Integrated Practice, here included in the Report on Integrated Practice series.
Unprecedented BIM Business Models for Unprecedented Times
The thing is, we’re living in unprecedented times. We all need to be creative in how we go about serving our clients – and getting paid for the considerable work that we’re doing.
Doing the same thing, taking the same approach, over and over, irrespective of the client or situation – whether stylistic sense or business sense – no longer works for the design profession and construction industry.
Coming-up with a creative BIM business model is a great start to assuring that the client is satisfied and you walk away with a profit.
To be creative in your BIM business strategy it helps to know what your options are.
It also helps to know how others have approached similar business situations so that we can learn from them.
That is where this magnificent new book comes in.BIM, meet BMI.
Building Information Modeling, meet Business Model Innovation, that is.
A self-described handbook for visionaries, game changers, and challengers striving to defy outmoded business models and design tomorrow’s enterprises, Business Model Generation is a model book for those who communicate design ideas for a living.
In short, BMG is a very practical and accessible tool to analyze and improve you and your business.
“Business model innovation,” say the book’s authors, “is about creating value, for companies, customers and society. It is about replacing outdated models.”
What is your organization’s business plan?
What is yours?
Whether you have one that is outmoded or don’t have one, you need this book.
How do you plan on leveraging BIM?
How do you plan on leveraging IPD?
Making the work process work for you financially is what this book will help you accomplish.
Are you getting paid for all the extra work that goes into your BIM models?
What’s your value proposition?
If not top of mind – if your answer isn’t on the tip of your tongue – then this book’s for you.Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers
This book will help you launch, re-launch or advance your career and business from a value creation standpoint.
BMG is an indispensible manual on how to map, analyze, and strip-down your organization’s business model and reassemble it into something that creates real value.
The starting point is the Business Model Template which allows you to break your business down into:
- Key Activities – What you do every day to make the model work
- Key Partners – Your suppliers and partners that help you make the model work
- Key Resources – The most important assets you used to create value
- Cost Structure – All the costs involved in running the business
- Customer Relationships – The types of relationships you have with your customer segments
- Customer Segments – The different groups of people you’re trying to reach and serve
- Channels – How you reach your customer segments
- Revenue Streams – Where you make cash from your customer segments
- Value Proposition – The key ideas that create value for your customer segments
For me, there are three undeniable benefits brought about by this book that compel me to recommend it here in a BIM and IPD blog.
1. Like IPD, the book follows its own advice and was written collaboratively – by a team of 470 practitioners (co-contributing co-creators) in 45 countries.
2. Business models, like building models, come in many shapes and sizes. You will recognize many of the books and cases mentioned in this book – and learn things about them that you didn’t know. This book will re-familiarize you with the most popular models – and encourage and inspire you to come up with your own – one that will work best for you or your organization.
3. The book is stunningly beautiful to look at – both rough and polished, well-designed – it will inspire; has the look and feel of Francis Ching’s books from the 70’s. It would be a sin to read this book on a Kindle or iPad. This one you have to feel in your own hands. The book is no stranger to visual and architectural design: one section of the book is entitled Patterns, and opens with an architect Christopher Alexander quote. The book was designed by The Movement http://www.thmvmnt.com/ a Global Change Agency that creates with people.In the interest of brevity, I won’t review the book here. Life is short – read it.
Still not convinced? For a summary see the following links and “About the Book” below.
Considering going back for your MBA?
This book will provide you with all you need to know for an MBA in BIM.
Order this paperback book here.
Get a taste (a 72 page PDF preview) of it here for free.
Visit the website.
Read co-author Alexander Osterwalder’s blog.About The Book
Synopsis
Disruptive new business models are emblematic of our generation. Yet they remain poorly understood, even as they transform competitive landscapes across industries. Business Model Generation offers you powerful, simple, tested tools for understanding, designing, reworking, and implementing business models.
Business Model Generation is a practical, inspiring handbook for anyone striving to improve a business model — or craft a new one.
Change the way you think about business models
Business Model Generation will teach you powerful and practical innovation techniques used today by leading companies worldwide. You will learn how to systematically understand, design, and implement a new business model — or analyze and renovate an old one.
Co-created by 470 strategy practitioners
Business Model Generation practices what it preaches. Co-authored by 470 Business Model Canvas practitioners from 45 countries, the book was financed and produced independently of the traditional publishing industry. It features a tightly-integrated, visual, lie-flat design that enables immediate hands-on use.
Designed for doers
Business Model Generation is for those ready to abandon outmoded thinking and embrace new, innovative models of value creation: executives, consultants, entrepreneurs — and leaders of all organizations.Added Value
One reviewer offered this comparison with other popular books on business models:
* The Ultimate Competitive Advantage: Secrets of Continually Developing a More Profitable Business Model by Mitchel, Coles, Golisano and Knutson, has a heavier focus on marketing with some ideas and questions relating to one-sided business models, so if you are looking to “sell more” perhaps you like this book.
* The Profit Zone: How Strategic Business Design Will Lead You to Tomorrow’s Profits by Slywotzky, Morrison and Andelman, has a heavier focus on profitability and the changing areas in which high profit is possible to keep, it is a quick read and perhaps complementary to The Business Model Generation that focus less on profitability.
* Open Business Models: How to Thrive in the New Innovation Landscape by Henry Chesbrough has a heavier focus on technological innovation in the context of business models and also covers the important area of Intellectual Property in relation to open business models.
* Getting to Plan B: Breaking Through to a Better Business Model by John Mullins and Randy Komisar, focus more on entrepreneurship and start-ups and on learning from experimentation and adjusting the business model, also with more focus on financials.
BIM + Integrated Design 
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Randy,
This is a funny coincidence. I just read about the Business Model Generation book this morning on Steve Blank’s blog on startups. Link here:
http://steveblank.com/2010/07/29/keeping-score/
Steve Blank ‘s Four Steps to the Epiphany was the most important book I read on the path to founding and growing Knowledge Architecture. However, it is not just for technology companies.
Steve Blank defines the startup as “the search for a scalable, repeatable business model.” Until you find the model (not the product) you don’t have a business. He provides an excellent framework for iterating through business models until you find the one that sticks. I cannot recommend it enough.
I think that you hit at the nut of the issue for the AEC industry and BIM/IPD/Collaboration with this post. I believe that architects need to return to startup mentality — starting by conducting the search for the new “scalable, repeatable business model.”
The Four Steps to the Ephipany is a great tool. It looks like the Business Model Genrator will be another one.
I just ordered a copy. My intention is to work through it with the Knowledge Architecture team in an upcoming monthly team day. I’ll let you know what I think.
Chris
Hi Chris,
Thanks for stopping by and for sharing your coincidence and insights.
The Four Steps to the Ephipany has been on my wishlist for several months now. It’s the only book I am aware of where the used copies are priced 50% higher than the new. Now there’s a business model for you!
Looking forward to hearing how you think it compares.
BTW I love how you said that architects need to return to startup mentality. Two years reading Copyblogger and I STILL can’t come up with a gem like that. I wish I said it first. You can count on my saying it henceforth… : )
Thanks again,
Randy
Just thought I’d chime in, for I’m the dude who told Chris to read the four steps book. 😉
Anyways, yeah, I think that we as Architects need to rethink how we work, where we really deliver value, and how we turn that value into actual cash.
When we were looking to start our design-build studio, I looked around at most of what I found from my industry I felt was just horribly broken. So we looked to the software and video game worlds instead to get ideas on how to organize our business. Hence my stumbling on the four steps book.
We’ve been trying to do this, and while we’ve yet to be wildly successful, my hope is with our current reorganization in our marketing focus and such we’ll be doing great instead of just surviving. Even if people keep telling us that we’re doing ‘great’ considering the market, just surviving doesn’t feel like that much of a win.
Anyways, I really like the fact that the thinking this book talks about was actually used to make the book. The four steps book is great in that way too, in that it’s very real and tested! Thanks for the heads up about it, I’m ordering it now.
Randy,
I like your many posts but still wonder why you include little discussion of BIM for fabrication. Real IPD must include working with the contractor – and preferably the fabricator – for maximum efficiency. The BIM Handbook very clearly states this as do many of the BIM researchers at Stanford’s CIFE and certainly most if not all of the leading virtual design and construction design build firms in Germany, Switzerland, Austria, etc. Even the BIM acronym implies not just modeling, but “Building” and “Information,” which we define is creating a very accurate and detailed virtual model, optimizing it in a collaborative process, and only then moving to fabrication and construction.
Our view has developed working on over 1,000 projects in 10 countries and we can refer to hundreds of real-world examples of the associated efficiencies. I can also point to Norman Foster, Frank Gehry, and Zaha Hadid as successful architects who have embraced the same or a very similar approach.
As scary as it may be, architects may actually have to engage with builders and fabricators in a collaborative process or continue losing business to the design-build companies – which of course the BIM Handbook and other respected resources refer to as the ideal models for full exploitation of BIM, IPD, and VDC efficiencies. You know, those guys who took shop class your referred to in an earlier post – tough to be a successful AEC professional and not work directly with them in the current market….or in the future, regardless of how long it takes for the building market to recover to historical norms.
Hi Greg,
Thanks for reading the post and for your comment. I wholeheartedly agree with you concerning the need for all team players – including fabricators – to be at the table from the earliest stages in the IPD process. If I have failed to mention this more frequently it is most likely due to the fact that I am generally focused here on the social impacts of the new technologies and work processes on the profession and industry. Moving forward, I will try to do a better job of representing all sides of the story – especially if I come across as having a designer’s bias. Posts such as this – and the next one – concerning the business of BIM were concerted efforts of my part to try to balance things out a bit. There’s a large playing field to please and I will do my best to address all parties involved. Thanks again for chiming in,
Randy