University Report: Innovation and Sustainable Business Development

This report delves into the critical aspects of business model innovation and its significance in fostering sustainable business development within a competitive landscape. It examines the conceptual framework of business model innovation, emphasizing its role in enhancing organizational functionalities and revenue generation. The report analyzes key components of business models, including charging subscription fees, selling products/services, and service contracts. It further explores e-business model archetypes, such as product, subscription, service, brokerage, trade, marketplace, and ecosystem models. The analysis extends to business models as activity systems, covering content, structure, and governance, and also investigates revenue architecture, including subscription-based and offer-related criteria, and revenue sources. Challenges such as resource constraints, lack of knowledge, and improper management are also considered. The report concludes by highlighting the importance of a strategic approach to business model implementation for achieving long-term sustainability and competitive advantage, emphasizing the need for adapting to market limitations and competitive dynamics.

Running head: INNOVATION AND SUSTAINABILITY
Innovation and Sustainable Business Development
Name of the Student:
Name of the University:
Author Note:

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Introduction
The current world of business competitiveness has become much challenging for the
business marketers. The marketers often focus on structuring the organisational functionalities in
order to provide the best solutions (Gobble, 2014). We often wonder what exactly needs to be
done to maintain sustainability in this competitive business scenario. The clear and concise idea
of the business model innovation can be fruitful enough in developing the organisational
functionalities. However, we need to derive the complete understanding regarding the business
model innovations. The identification of the associated components would provide the insightful
knowledge about the method of business sustainability. Here we would discuss about the
conceptual form of business model innovation and its significance in maintaining sustainability.
Discussion
In pre-classical times, the business model was conceptualized as the integral part of the
economic and trading purposes. Apparently, the business model refers to the methods used by
the organisations for generating revenues (Casadesus‐Masanell & Zhu, 2013). In the real
business world, the business marketers generally deal with the basic components of the business
model. These basic components are:
 Charging Subscription Fees
 Selling purpose of the product or service
 Selling service contracts
These components are significantly helping the organisations to generate expected revenues.
The business model innovation specifically concentrates on factors that are ensuring more
profitability for the company in this competitive scenario. According to Zott, Amit and Massa

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(2011), Business Model is widely conceptualized as the description, representation, and a
statement of the business world. Therefore, we can consider that the business model pays the
closer attention towards the following factors:
 It articulates the value propositions that are created while offering the products or
services to the customers.
 It identifies the relevant market segment for ensuring the purpose of selling.
 It defines the value chain structure while distributing the product and service to the
customers.
 It estimates the profit potential and cost structure of the products
 Describes the competitive positioning of the firm
 Structures the competitive strategy for winning over the rivals in the business market.
In the further section of the study, we would discuss the three major concepts of the business
model that have the significant impacts on the business functionalities. In this section of the
study, we would provide the explanation of the conceptual analysis of three business model
components. These three concepts are:
 e-business model archetypes
 Business model as activity system
 Business model as revenue architecture
The e-Business Model Archetypes depend on the seven business fundamentals or
personalities. The business model depends on these personalities during the development period.
These seven business fundamentals are:
 Product

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 Subscription
 Service
 Brokerage
 Trade
 Market Place
 Eco System
The business primarily focuses on the development process of the tangible artifacts that
require one-time cost. In some of the cases, the product is generally consumed for the personal
entertainment (Narayan & Volberda, 2017). The indicative attribute of the products are as
follow:
 Key partners: Market Place
 Value propositions: The productivity scale
 Key Activities: Development functions
 Monetization: Product sales
The second type of the fundamental is the combination of the services and products
(Christensen Bartman & Van Bever, 2016). The subscription personality focuses on the
following aspects:
 Key Partners: Owner of the ecosystem partner
 Value Proposition: Customization of the platform
 Key Activities: Maintenance and Customization
 Monetization: Materials and Adequate Time

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Service is the third type of the business fundamental that signifies the intangible solutions
offered to the clients or the customers (Spieth, Schneckenberg & Ricart, 2014). This fundamental
indicates the following attributes:
 Key Partners: Platform owner of the Ecosystem
 Value Proposition: Customization of the Platforms
 Key Activities: Maintenance and Customization
 Monetization: Materials and Adequate Time
This archetype is the secondary form that includes the trade and service activities on behalf
of the clients or the customers. The attributes are:
 Key partners: Wholesalers
 Value Propositions: Procurement of the Efficient Commodity
 Key Activities: Recruiting the sufficient number of Wholesalers
 Monetization: Commission of Base fee plus
This type of the archetype pays attention on connecting the sellers and buyers. The attributes
are:
 Key Partners: Advertising and Product Sourcing
 Value Proposition: Convenience, Low Price
 Monetization: Product Arbitrage
 Key Activities: Advertising and Sourcing
It is the secondary archetype that includes the attributes of the product and trade archetypes.
The attributes are:

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 Key partners: Merchants
 Value proposition: Method of Destination Shopping
 Key Activities: Advertise and Recruit the vendors
 Monetization: providing a particular amount of commission per sale
It is the tertiary archetype that combines other archetypes and quite difficult to achieve. The
attributes are:
 Key Partners: PaaS Provider
 Value proposition: Software and Management
 Key activities: development of the software
 Monetization: Subscription Fee
Business Model as Activity System is mainly focusing on several elements, such as
content, governance, and structure. The content of the activity system refers to the selection of the
activities. The structure of the activity system defines the linking between the activities. It is also
capturing the importance of the business model (Markides, 2013). On the other hand, the
governance of the activity system ensures the performance of the associated activities. It focuses
on the possible approach to maintain the governance procedure. It is notable that the managers
often strive to make progress in the profitability parameter. Therefore, it is necessary for them to
undertake all these parameters simultaneously. However, sometimes it becomes much
challenging since it involves some of the factors to be considered. It is necessary to understand
whether the business requires including any secondary market for trading the business loans
(Schneider & Spieth, 2013). In fact the possible barriers are also necessary to be identified. The
design parameter of the system activity becomes highly interdependent. Hence, apparently the

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business model as the activity system is mainly concentrating on the process of conducting
business.
The revenue model determines the method of generating revenues by the firm and it is
the integral part of the business model. Subscription is one of the most fruitful revenue models
that deal with the free transactions, profiling and functions (Fielt, 2013). The business model as
revenue architecture identifies the various type of the revenue model. It focuses on the actions of
the customers by maintaining the effective relationship. On the other hand, the criterion
sometimes limits the method of generating revenues from the customers’ end. It becomes much
challenging for the business marketers when the price of the products is persuaded to keep lower.
Another major focus is the offer-related criteria that maintain the price level, consistency, and
origin of the offered service or products. It is necessary for the company to obtain the adequate
knowledge regarding the management of the functionalities that can ensure more revenues.
Finally, the revenue related criteria focus on the payment method and the origin of the revenue
(Zott, Amit & Massa, 2011). It is to be stated that the origin of the revenue can be from the direct
or the indirect source. The benefit related criteria signifies additional benefits provided to the
customers for gathering their attention. It is quite helpful for the company since there is the high
chance of the long term relationships. However, the product consistency is the major factor to be
considered in such aspect.
The business model innovation provides the top-down approach that is significant enough
in generating more profitability and establishing the long term sustainability. However, the
challenges are faced due to the lack of resources, lack of adequate knowledge, and improper
management of the organisational functionalities. The business model as revenue architecture
identifies the various type of the revenue model. It focuses on the actions of the customers by

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maintaining the effective relationship. The limitation with the service and product information
influences the purchase decisions of the customers. It becomes much challenging for the business
marketers when the price of the products is persuaded to keep lower. Another major focus is the
offer-related criteria that maintain the price level, consistency, and origin of the offered service
or products. It is essential to obtain the adequate knowledge regarding the business model
functions and structure these functionalities according to the requirements.
Conclusion
The artifacts included in the business innovation model sometimes lead to the business
failure. Therefore, it is necessary to derive the adequate information relate to the implementation
of the business process. In the real business world, the business marketers generally deal with the
basic components of the business model. The clear and concise ideas regarding the conceptual
analysis of the business model is quite necessary for the business marketers. The contribution of
the business model innovation is much significant in generating the revenues. However, it is also
necessary to derive the extensive knowledge about the strategic procedure of implementing the
business process. Business model as the revenue architecture depends on the segment based
criteria. The offer-related criteria that maintain the price level, consistency, and origin of the
offered service or products. It is necessary for the company to obtain the adequate knowledge
regarding the management of the functionalities that can ensure more revenues. The resource
capability and focus on the customer base are also needed to be taken into consideration during
the development of the business model. The concentration on the market limitations and
competitiveness is essential prior to take any decisions regarding the business model innovation.

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References
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Fielt, E. (2013). Conceptualising business models: Definitions, frameworks and
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