Business Model Innovation in P&G Company

Running Head: Innovation and Sustainability Business Development
Innovation and Sustainability Business Development

Innovation and Sustainability Business Development 1
“Business model innovation in P&G Company”
Business Model Canvas is a strategic tool that helps organizations in developing a template with
the help of which they can initiate success for the company in the target market. The purpose of
this task is to provide a detailed literature of the business model canvas and its relation with the
disruption present in the environment. It also talks about the external environment analysis
(opportunities and threat) that are attained to the company P&G with the use of smart connected
products. The latter part of the essay talks about the business model canvas of P&G along with
its relation with value creation and resource and capabilities. More details about the essay are
discussed below:
The business model canvas approach is defined by Osteerwalder and Pigneur in the Business
model generation book (2010). Further, according Teece (2010), the business model pronounces
the information and provides valuable data and evidence that helps the company in identifying
the values that the company can provide to the customers. Further, it should be noted that the
model is a tool that includes different aspects and their relation with various activities of the
company (Chesbrough, 2010) . The business model canvas is a tool that innate all the process of
the organization and provides ways in which an organization can create value in the target
market.
Further, Zott et. al. (2011), in their literature stated that the business model canvas refers to a
statement , description, representation, an architecture, a conceptual tool or a model that
represents value of different departments of the company. The business model should of an
organization should expressive the value proposition of the company by creating value in the
products and services offered. It should identify the market segment (the users of products), the
model should also define the value chain structure in the organization that should be used to
supply the products. The model should also estimate the cost structure and profits that are to be
earned using company’ value proposition. It should also describe the position of the company
with the network linking the key people of the company; and lastly, it should formulate the
competitive strategy to earn success in the target market Morris et al. (2005).
A business model canvas in the current environment can only attain success by using technology
and innovation in their process. With the changing environment it has become important to use

Innovation and Sustainability Business Development 2
disruption in the model to capture the value of the company and provide it to the customers
present in the market (Osterwalder, & Pigneur, 2010). It should be noted that disruption has
become a buzzword in the competitive environment; with the use of such disruption, an
organization can easily transform their business activities to efficiently provide its services in the
target market. The companies that include disruptive innovation in their business activities tend
to earn more benefit in the market (de Jong, & van Dijk, 2015). This disruption in technology
and innovation changes the complex and costly products in simple and easy affordable products
that can be used by people. It should be noted that the companies now days are shifting their
focus on the needs and requirements of the customers present in the market. AirBnB has become
one of the examples in this case by becoming disruptor in the environment by improving their
hospitality services and providing better conditions to the customers to live in. Thus, it increases
the customer satisfaction and sales for the company accordingly (Johnson, Christensen, &
Kagermann, 2008).
Further talking about the company P&G, it should be noted that the organization is an American
multinational organization that was founded in the year 1837 by British American William
Procter and Irish American James Gamble. The company provides a wide range of personal care,
cleaning agent and healthcare products in the market (P & G, 2018). The company has attained
various opportunities in the market with the use of efficient and effective smart connected tools.
These tools refer to a technological innovation that assists the organization in expanding their
business activities to achieving the success in the market. These are the tools that are related to
the IoT (internet of things) and helps in connecting, transferring and sharing the information
from one department of the organization to another. These products add functionalities in the
activities of the company P&G that helps them in growing the profits in the market. The smart
connected tools are developed with the software, processors and sensors that allow the company
to share data to different departments (Zott, Amit, & Massa, 2011).
The company P&G is regarded as one of the biggest company initiating its activities in the
external environment. So, these tools provide opportunities to the company in effectively
operating its business in the international market. With the help of such tools the company can
shares data with the branches of the company in different parts of the world in seconds which
increases the effectiveness of the system. Also, the company connected its various products with