Alex Osterwalder on The Dual Operating System

By Scott Kirsner |  January 14, 2016

Sharing an excerpt from our December conversation with Alex Osterwalder, creator of the Business Model Canvas tool and co-author of the books “Value Proposition Design” and “Business Model Generation.” Our complete interview and a transcript are available here for InnoLead subscribers.


InnoLead: What for you is an important idea heading into 2016?


Alex Osterwalder: The dual operating system. Others call it an ambidextrous organizationRita McGrath calls it the end of competitive advantage.


It means those who are executing the existing business model, they need to accept, “Hey, we need to build the future and we need to finance that, so we need to give some of our money to those who are building the future. Because without those, we’re going to end up like Nokia, we’re going to end up like Kodak.”…More and more companies are actually aware that business models expire faster than ever, value propositions expire faster than ever, and that they need to create that [new] entity that will create their growth.


It’s happening. It’s very slow. Nobody’s there yet, from what I see. Even those that are in the press all the time, like GE with FastWorks, nobody’s nailed it yet, but that’s going to happen in the next two or three years. I’m pretty certain that companies will build that kind of dual structure.


It’s hard to do, because there’s so many variables to get real innovation [to happen], growing new business models and value propositions. There’s so many variables that without a serious commitment, not just lip service, without a long-term commitment, nobody will be similar to Apple or Amazon. It won’t happen.It’s very unfortunate that we have to mention companies like Apple. But how many business models have they created over the last decade or two?


…Everything from the iPod to the iPhone, guess what? That’s a completely different business. It’s not just the technology. …That’s pretty impressive, but more companies will be able to do that. Otherwise, they’ll die.