Is Your Business Model NDIS Ready?
If you want to change the world, change the metaphor – Joseph Campbell
The National Disability Insurance Scheme (NDIS) in Australia is a phase change for the sector. Just like a phase transition in physics (like ice to water to vapour); this kind of change will require a huge amount of energy and result in very a different business context after the change.
Is your business model ready for the change?
A business model tells a story about how you create, deliver and capture value. Most organisations affected by the NDIS were designed to run with the government as their main customer; receiving block funding to support their operations. After the change, customer insight will become paramount, as firms will be increasingly judged based on their value proposition. This will drive firms to innovate and develop new ways to creation, delivery and capture value.
Maintaining and building quality service while managing cost is challenging – particularly in the delivery of human services provided in highly regulated environment. The potential volume of ‘sale’ and point of difference are two factors that service providers are grappling with to decide if they have viable proposition going forward.
- Fiona Kelly, GM, UCWB (Business Models Inc AUS-NZ Client)
The introduction of the NDIS also presents a new challenge for the community services sector, which has been plagued by ad hoc collaboration, duplication of effort and service overlap – driving cannibalistic competition. As identified in an IBISWorld Industry Report (Q8700 – Community Services in Australia, February 2015 | Arna Richardson), the industry currently spends upwards of 58% of annual revenue on wages – as new roles and capabilities are required, controlling costs and identifying the value drivers for businesses will be critical to transition survival and future success.
To be truly ready – we believe your business must be able to confidently answer the following questions:
- Do we have accurate and up-to-date information about our customer segments, the ‘jobs’ they need done, and the obstacles that stand in their way?
- What is our business context, and what are key drivers of change or uncertainties that will affect our chances of success?
- Have we ‘pressure tested’ our business model, to validate our assumptions about the resources we will need, and the business activities we may have to redesign?
- Do we have partnerships and collaborative relationships in place with complementary service providers to ensure our service is maximally optimised for efficiency?
These are significant changes that will prompt businesses to better understand their customer’s journey, create new value and develop business models that improve people’s lives and contribute to a healthy future. For others, it could be the beginning of the end.