Business Model Innovation and Adaptation
Added on 2020-03-01
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Running head: INNOVATION AND SUSTAINABLE BUSINESS DEVELOPMENTInnovation and Sustainable Business DevelopmentName of the StudentName of the UniversityAuthor Note
1INNOVATION AND SUSTAINABLE BUSINESS DEVELOPMENTIntroductionBusiness model is one of the main and inseparable parts of the business concepts. A reallife organization can never thrive in the competitive business environment without developing aproper business model. Almost every organization must develop an appropriate business modelat the point they are a start up organization. The aim of this paper is to discuss the variousmodels and evaluate them from different perspectives like business models as e-businessarchetype, business models as a strong activity system and business models as cost-revenuearchitecture. The term of ‘business context’ and the need for change in the business environmenthas to be discussed in this paper as well. This discussion will lead to a better understanding ofthe business model concept and its usefulness in the modern business environment.Business modelBusiness model is considered to be the way by which the company produces it revenueand the very process by which they increase their profitability as well (Amit & Zott, 2012). Themetric gross profit is the method by which the analysts use to measure the efficiency and theeffectiveness of a business model introduced by the particular company. This gross profit for thecompany can be calculated by the subtracting the selling cost of the good from the revenues. One of the two business models that are most important to evaluate the business model ofa company are its pricing and costs. A certain company can obviously increase the price of itsproducts whenever they feel comfortable (Amit & Zott, 2012). They can be able to find theinventories at the decreased costs of the products as well. The thing is that both of these methodscan increase the gross profits for the company. Gross profit is the way the company is heading toand it is strictly based on the figures, not on how efficiently the management is working at that
2INNOVATION AND SUSTAINABLE BUSINESS DEVELOPMENTmoment for the company. Some of the business investors can run the business by focusing on thebusiness models, focusing lightly on the efficiency of the management team. This can lead to ainefficient management team as well.Business archetypes Business archetypes are very fundamental issues when discussing about the businessmodels in the organizations (Bocken et al. 2014). Sometimes challenges arise within a businessorganization when the business organizations and the decision makers are not aware of someparticular business models. This happens because they have only studied about the differentbusiness strategies as important theories. The practicality of the situation is not studied by thosepeople. The idea of the business model archetypes or the e-business model archetypes (especiallyfor the online businesses) was invented by the psychiatrist Carl Jung. He introduced sometemplates within the business models and categorized them by two types. One is primary and theother, secondary (Bocken et al. 2014). The primary archetypes are the Product, the second one isService and the third one being the Trade. Product refers to the buying of a product only once,The second phase includes the service that refers to doing something manually and charge feesfor it. The third one goes for trade that means connection of the buyers and the sellers. The thingsin the secondary stage are Brokerage, Subscription, Marketplace and Ecosystem (Bocken et al.2014). Business model is an activity systemThe business model is a very integral part of the business and it is deeply interrelatedwith the activity system of a business organization. All the decisions and the business models areclosely related and interwoven between one another (DaSilva & Trkman 2014). This sets up
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