Millhouse Construction: Business Model Canvas and Organizational Structure

This report analyses the business model canvas and organizational structure of Millhouse Construction, an Australian company that combines investments, development, and construction. The report suggests a suitable organizational structure for the company and highlights the importance of project organizational structures.

Millhouse Construction: Business Model Canvas and
Organizational Structure
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Contents
Introduction.................................................................................................................................................3
Essay............................................................................................................................................................4
Business Model Canvas...........................................................................................................................4
Designed for: Millhouse Construction.....................................................................................................4
Applicable Organizational Structure........................................................................................................7
Characteristics of project organization....................................................................................................8
Importance of Project Organizational Structures....................................................................................8
Conclusion...................................................................................................................................................9
References.................................................................................................................................................10
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Introduction
Millhouse Construction is an Australian company which has the combination of three business
activities- investments, development and construction. This report states the business model
canvas for Millhouse Construction. All the business activities of the company are analysed from
the case and drawn into a business model. This report also suggests the suitable organizational
structure for the company.
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Essay
Business Model Canvas
Business Model Canvas can be defined as a tool for relating, evaluating and designing the model
for business. In the business model generation all the techniques, concepts and tools are used to
be tie together.
Below is the business Canvas Model for Millhouse Construction:
Designed for: Millhouse Construction
Key Partners
 Government
 Solution
Providers
 Engineers
 Architects
 Designers
Key Activities
o Construction
o Development
o Investment
management
o Health &
Safety
o Diversity &
Inclusion
o
Value Propositions
 Expertise in
managing the
assets
 Generating
value by
creating high
quality
 Sustainability
 Development
opportunities
 Challenging
and interesting
projects
Customer
Relationships
 Customer
focus
 Integrated and
innovative
solutions for
clients
 Niche market
Resources
 Human
resources
 Financial
resources
 Equipment’s
and
machineries
Customer Segments
 Public client
 Private client
 Customer
projects
-serviced
apartments
-retail centres
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Channels
 Head Office Sales
 Web platforms
Cost Structure
 Rent & Utilities
 Marketing Campaigns
 IT
 Infrastructure
 Head Office Salaries
 Cost incur on Programs
Revenue Streams
Sales
Revenue from construction and
development project
Investment returns
(Osterwalder and Pigneur, 2013)
The nine elements of the business canvas model of Millhouse Construction.
For many enterprise partnerships or key partners has become a source to gain value proposition
or to carry out business activities smoothly. Millhouse shall lay focus on the strategic alliances
i.e. joint venture between non-competitors. The partnership brings numerous benefits for the
business, for example, risk and uncertainty reduction, minimization of cost all the way through
offshoring or outsourcing, possession of explicit resources and activities. The key activities of
Millhouse Construction which influence customers are: construction, development and
management of investment. Besides this company`s key activities also includes lifestyle
programs, health and wellbeing programs. The key activities not only lay emphasis upon
customer services but also concentrates upon the employees. This could motivate the employee
and enhance their level of engagement. Value Propositions element of the business canvas
model will facilitate in satisfying the customer`s needs or solving their problems. Company shall
focus on Generating value by creating high quality. The product or service of the company shall
be of high quality. Opportunities for development in context to employees are also a value
proposition for the company (Joyce & Paquin, 2016). Next point in business canvas model is of
customer relationships. Customers are the centre of business or in other words, activities of the
organization are cantered for the customers. The integrated and innovative solution shall be
provided to the customers. All the activities shall focus on the customers and niche market shall
be developed for the business to target potential customers.
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Company shall focus on a particular segment in which potential customers for the business exist
i.e. customer segments. The customer segment of Millhouse includes- public client, private
client and Customer projects. All such customer segments are crucial for the business. The
business of the company is development and construction. This segment of the customer has a
number of the audience which could be targeted for the business. Resources are the element
allocates the enterprise to put forward and convey its value proposition. In order to carry out the
business activities, a number of resources are required. For example in construction project
machinery are required and machinery could be a resource for the business. Important resources
for Millhouse Construction are- financial resources, to bear the expenses; human resources, to
perform business activities; machinery, to carry out the work related to construction and other
business activities. Next element of business model is channels of distribution. This element
characterizes the manner how the company will influence its customers to pass on value.
Distribution of service could be done by the head office. The service or product could be
purchased by the customers directly from the office of the company. Another channel is web
platform. This channel could be used for creating awareness among the customers, allowing
purchases, providing support, delivering as well as selling services to them. The web platform is
a unique idea for distribution of the product or service to the customers. Technology
advancement provides benefits to the business and web platform is one of the benefits.
Cost Structure (Money out) - Cost incurs on carrying out business activities. It is up to the
businesses that how they manage their cost. As by minimizing cost they can get more profit.
Millhouse Construction would have to incur cost on utilities which include- computer systems
and furniture. The marketing campaign for promoting the business will also lead towards the
high cost of business (Osterwalder and Pigneur, 2013). Another expense for the company is
related to the programs which are going to be initiated by the company for employees. Cost
structure involves the salaries as well. About 1200 employees are working in Millhouse
Construction and cost will also incur on paying salary to the employees. The revenue stream
(inflow of cash) includes the aspects through which company will get income. The stream of
revenue for Millhouse Construction is- revenue from construction and development projects
(Brigham & Ehrhardt, 2015). Another source of revenue is from the investment. The return on
the investment will be revenue for the company.
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Applicable Organizational Structure
The above business canvas model could be achieved by Millhouse Construction through
adopting appropriate organizational structure. By analysing the above model and the case of
Millhouse construction, it the project organizational structure will be appropriate for the
business. Organizational structures such as line and staff, functional and line assist in
establishing and distributing authority for control and vertical coordination more willingly than
horizontal relationships. The flow of work process is horizontally in some projects and it may
flow diagonally, upwards and downwards also. The talent distribution, the abilities within the
organization and the need of applying them with the existing problem are the aspects on which
the direction of workflow is dependent (Whelan and Meaden, 2012). To cope with situations, the
project organizations and matrix organizations have emerged.The project organization is termed
as an organization which is designed for achieving the specific results by the use team specialist
which belongs to different areas of the organization. All energies resources and results are
focused on the project team for the assigned project Gibson, 2012). The team members who
belong to various cross-functional departments go back to their previous position when the
project gets completed or they can be assigned to a new project. The examples of the project are
as follow - product development, housing complex, research and development projects, shopping
complex, construction of a new plant, bridge etc.
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Characteristics of project organization
To the project the personnel are assigned which belongs to the existing permanent organization.
It is all under the direction and control of the project manager. It is specified by the project
manager that what effort should be needed and when will be the work performed. The manager
of concerned department executes the work through his used resources (Whelan and Meaden,
2012). The support which the project manager needs for completing his project is given by the
quality control, production, engineering etc. The project managers and functional managers of
the permanent organization have the authority over the project team. The services are
temporarily given by the specialists and are loaned to the project manager till the project gets
completed (Marbaise and Probert, 2012). Between departmental manager and a project manager
conflict can arise on the topic of the issues of practising authority over team members. The
authority relationships have common characteristics with the potential of informal relationships
and conflicts, between the departmental project manager and project manager. It becomes more
significant than the formal recommendation of authority. For the working project full and free
communication is required.
Importance of Project Organizational Structures
 It becomes more valuable when
 Particular target date and goal is defined as completion of work.
 The work is unfamiliar and unique to the organization.
 The work has self-determining activities moreover it is very complex. For the
accomplishment, the specialized skills are required.
 In the context of probable gains or losses, the work becomes critical.
 In nature, the work is not repetitive.
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Conclusion
It is vital for the business to choose correct organizational structure which matches with the
business activities, policies and procedures of the company. In the case of Millhouse
Construction, it can be concluded threat project organizational structure will be applicable to the
business since company indulged in project related business. In addition to this, it can also be
concluded that business canvas model is also crucial for the businesses to comprehend all the
activities in a single model.
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References
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Gibson, J. (2012). Organizations: behaviour, structure, processes. New York, NY: McGraw-Hill
Irwin.
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Elgar.
Teater, B. (2010). An introduction to applying social work theories and methods. Maidenhead,
England: McGraw-Hill/Open University Press.
Whelan, J. and Meaden, G. (2012). Business architecture. Burlington, VT: Gower Pub.
Osterwalder, A. and Pigneur, Y. (2013). Business Model Generation. New York, NY: John
Wiley & Sons.
Marbaise, M. and Probert, C. (2012). The Business Model Canvas.
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Page Publishers.
O'Leary, S., Sheehan, K., & Lentz, S. (2011). Small Business Smarts. ABC-CLIO.
Brigham , E. F., & Ehrhardt, M. C. (2015). Financial Management: Theory & Practice: Theory
and Practice. Cengage Publication.
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Joyce & Paquin, 2016. The triple layered business model canvas: A tool to design more
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