How to Visualize an Innovative Nonprofit Business Model (+Video)
(Get the Nonprofit Business Model Canvas here)
While the nonprofit version of the canvas has been a personal remix of mine, it has been accumulating lots of downloads recently from consultants, founders, and practitioners.
You could let the original canvas suffice, but you soon have to factor in social impact, mission metrics and the diverse set of stakeholders that come into play.
The best common one-liner I get from users when using the canvas?
"It just makes sense."
Nonprofits have a mission to accomplish, but they're not exempt from revenue and funding their operations.
Various nonprofit canvases out there exist, but some of them leave out the implied "flow of resources" when it comes to creating, delivering, and capturing value. Some even leave out revenue altogether. That's a bad idea.
Why? Because I find it hard to leave out any talk of money. Keeping the original logic of Osterwalder's canvas, and expanding the Customer Segments block - renamed Co-Creators on the nonprofit canvas - was absolutely necessary along with expanding the Revenue Streams to "Outcome Streams."
I created a recent video tutorial (June 2018) which narrates some successful tips in helping people understand their nonprofit better. Some of these tips aren't too foreign. Things like Blue Ocean Strategy's Four Action Framework could be found in the indispensible book "Business Model Generation."
A Common Visual for Common Ground
There's a reason I call the canvas "A common visual for common ground." It reduces the complexity into a simple format so that everyone in the room can understand it. It also helps people catch fallacies and mistakes in their own concepts.
Remember, the moment it starts looking like another business document, you end up defeating the purpose of why Osterwalder drilled his dissertation down into a visual canvas in the first place.
Here's a sampling of visual techniques you can use to visualize a more innovative nonprofit business model. You can even apply this the usage of the original canvas as well:
1. The Flow
Probably the most important concept. The flow is the visual logic of how you create, deliver, and capture value. What you capture in the form of time, money, attention - whatever - goes back to fund the Operations side. I've always kept Outcome Streams divided into two categories: Financial Outcomes and Non-Financial Outcomes, giving people the option to omit revenue if they wanted to. If you don't want to talk about money, cross out the category.
But you know what? When assisting the strategic planning of nonprofits, there's always talk about money and "overhead." I haven't had a conversation yet that didn't talk about revenue one way or another!
2. Visualize Costs and Rewards
This doesn't really need a super complex explanation. Everything you earned on the delivery and engagement side must go back to the operations side. That completes the flow.
3. Connecting Outcome Streams
This is a big one to look out for. You definitely want to reduce "orphan" entries on your canvas. In the video, I cover how to visualize the connections between Co-Creators, Outcomes, and Social Value Propositions. Once you get to this part, you'll understand why all this visual sensemaking stuff is critical: it helps you catch orphan entries and mistakes!
Imagine trying to figure this out in a binder full of business documents.
4. Epicenter Thinking
Imagine throwing a pebble across a still pond and watching it skirt across the surface before making impact. The ripples evenutally touch the edge of the pond. That's the visual I want people take away whenever they add, subtract, or modify anything in their canvas.
Watch the rest of the in-depth video including entries 5-9 below.
As of May 2018, the Nonprofit Business Model Canvas has been redesigned to include more visual markers, cues, and plenty more white space. The categories and blocks are mostly the same.
I hope you'll find it useful. Get the Nonprofit Business Model Canvas here.
P.S. I've now reached a point where I need Spanish and Portuguese translations for the Nonprofit Business Model Canvas. Contact me if interested.
ICYMI: Read about Business Model Generation Mixed Methods here
Read the NBMC FAQ here.
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