Comprehensive Report on Business Model Innovation and Sustainability

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This report delves into the development of innovation and sustainable business models. It emphasizes the significance of business models, highlighting their components like cost and price, and their role in business growth. The report explores the nine building blocks of a business model, e-business architecture, and various archetypes, including e-commerce and lead generation. It examines business models as activity systems, cost-revenue structures, and revenue streams, discussing static and dynamic issues. Furthermore, the report covers conceptual components related to e-commerce and entrepreneurship, as well as the impact of technology innovation on business models. It also analyzes business context, notions, and the influence of technological changes, drawing examples from companies like Google, Amazon, and EasyJet. The report concludes by emphasizing the importance of adapting business models to market trends and the need for managers to focus on design elements and themes to achieve desired outcomes. It references several academic sources to support its findings.
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Development of innovation and sustainable business 1
Innovation and sustainable business development
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A business model consist specific combination of distribution, supply chain, product,
pricing, payment and sales. It is the model which is far more important for the success of the
business. It is comprised with two major components that are cost and price. Gross profit is a
major point of profitability because the major focus of its only on cost instead of expenses. It
does not have concern about the efficiency of business because it focuses on to only business.
Business model is very important for the business because it helps to grow the business in a
progressive way. A clear business model is important to the growth of any business and it has
been considered as the foundation of the innovative technology. New technology cannot come in
an existence without a business model. A successful business model is able to enhance the
commercial return through cost investment and drive innovation. Business model has the
capacity to attract many customers towards the business because with the help of business
model, it is proved that the guidance of large scales is not required for the business. A business
model consist 9 building blocks which describes all necessary requirements in the favor of
business. it defines the strategy of the business without having complexity such as over
burdened, high workflow, hierarchy rules, strict rules and regulation. The nine building block of
business model is described below:
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Figure 1: Business model
E-business architect is the element of business model. It is the concept in which number
of approaches was developed. It has a practical approach which makes able business to think
widely. The archetypical business model describes the value proposition, value creation,
innovation, customers, organizational architecture and economic dimension to elaborate a
complete understanding of making customers in a systematic way with customer value (Baden-
Fuller & Morgan, 2010).
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Figure 2: Business archetypes model
Source: (Teece, 2010).
There are seven archetypes which is upper level of abstractions that elaborates basic truths about
categories of business. Due to have the tendency of abstractions it is not possible to being
evident applying of them. It has prototypes example such as e-commerce and lead generation.
Both are the examples of getting something of value and introducing it into the market for the
purpose of sale. It has been found that money is being made on the broadcast between the cost of
garbing the item and what it can be sold by the seller for the purpose of promoting and
marketing. For instance, in the business of online business, same kind of software and content
will be the most two common types of things to sold in the market.
There are many things will be involved when referring to the concept of a business model as an
activity system. An activity in a business model can be engaged by human, physical or capital
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resources of any elements to the business model. It is required to fulfill the requirement of the
overall objective. Am activity system is a group of independent activities of organizational
including partners, vendors and customers.
Business model as a cost revenue architecture involves key partners, activities and
resources. The scale of variable, fixed and economy should be considered effectively. Business
model as a revenue stream involves each customer segment and price contribution. The main
focus of business model as cost revenue structure to make money by efforts. It would be the
target of an organization to make revenue strong so that new opportunities of the business turn
into annuities.
There are two issues such as static and dynamic. Static issues are having the nature of
long term on the other hand dynamic issues have the nature of forceful. The business blocks of
business model are able to handle the both issues systematically. Business model as activity
system can be used to know about the innovation in the business. There are number of
conceptualization components in the business. In the context of e-commerce, conceptual
components can be value stream, logistic stream and revenue stream. In the context of
entrepreneurial, conceptual components can be market factors, growth factors, competitive
strategy, internal capability factors and economic factors. These all are the factors of conceptual
arguments which can be used to seek the issues of static and dynamic problem (Sanchez &
Ricart, 2010). These will be helpful to design or redesign the business models for the business.
Apart from that technological input, network architecture, system architecture viewpoint market
offering, supplier value proposition, customers, competitors and longitudinal process are the
conceptual components to design or re-design the business model to analyze the issues of static
and dynamic issues. Learning system and delivery system are two major element of business
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system. As per conceptualization, business system is considered as the assumption of decision
maker who is able to decide that in what range business will obtain certain profit at certain time.
Profit models as well as business model are the part of business model. As per Itami and
Nishano, Google and Toyota are the exact example of the better model. They have settled their
model to gin the maximum profit by keeping concern of the customers as well as employee.
These are the companies which enhance the productivity of the employees by giving efficient
services to their customers without getting any single penny. Toyota is the company which
outsources its model of automobile constantly. It maintains the focus on suppliers to gain indirect
profit (Itami & Nishino, 2010).
A business context is a tool of analysis which is operating to analyze the environment in
which business operates. Business context can included organization, individual and huge
community in it. As per changes in technology and demand of customers, business has to change
its business and re-design its model appropriately. There are a number of business notions such
as customer, addressable market, value creation, core business and management. It is the
business notion of Google, Apple and Facebook that their customers get best possible customer
experience (Seville, Buxton & Vorley, 2011). The example of addressable market is when Mark
Zuckerberg launching a business, he settled out to have a monopoly on customers’ attention and
commitment. It is necessary for the business to make changes without hurting anyone. Value
creation is necessary for the business because it beliefs to make tier customers save time and
effort, it is considered as the strategic performance indicator. To make amendments for
extending a business, it is necessary for the business to make an inventory of what business is at
good or what customers are demanded. It is required for the business to replace the notions of
expertise by learn ability and innovations (DaSilva & Trkman, 2014).
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Business model is interlinked with technology innovation. The development of
technology can help to make new business model for the business. It will definitely impact the
managers of the organization in their decision making. There are examples of Google, Amazon
and Easy jet which shows that how business get impacted due to changes in business model. The
effects of business model innovation are not separated from the effects of business model on
performance due to technological innovations. It has been analyzed that innovations by
technological influences performance and reviews (Bharadwaj, El Sawy, Pavlou &
Venkatraman, 2013). Regarding changes in business models, managers of the organization
should be more active because a business model is a structure to gain more profit within certain
period of time. It contains nine blocks in it and as per technological innovation, it is required to
bring changes in the organization (Schaltegger & Wagner, 2011). In the article of Zott and Amit
argued that there are two parameters of design: design elements and design theme. Manager need
to focuses on them because design elements describe the specifications of drivers in the context
of customer values, which can be elaborated in the term of complementary, lock in efficiency
and novelty. Design theme is considered as the structure in which discussion of activity system
performance made. With the help of these parameters of articles, manger of the organization
would be able to take the decision efficiently because the advantages of these parameters of
articles are summarized in the order to create and achieve the outcomes of values.
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It has been concluded that the business model as a system are able to solve the static and
dynamic issues, delivering satisfaction and engaged customers with their needs. Business models
can be blindly applied to a setting which brings attention of customers regarding difference and
creativity. In this report e-archetype, business model as system activity and business model as
cost- revenue structures has been elaborated. Various kinds of business conceptual components
have been discussed in this report which will be helpful to reduce the effect of static and
dynamic issues within the organization. A business context and notion has been mentioned in
this report effectively which will be useful for further studies. Technological innovation can be
seen day by day and it is required for the business to make changes its model as per trend of the
market.
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Development of innovation and sustainable business 9
References
Baden-Fuller, C. & Morgan, M.S. (2010). Business Models as Models . Long Range Planning 43
(2010) 156e171.
Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. V. (2013). Digital business
strategy: toward a next generation of insights.
DaSilva, C. M., & Trkman, P. (2014). Business model: What it is and what it is not. Long range
planning, 47(6), 379-389.
Itami, H., & Nishino, K. (2010). Killing two birds with one stone: profit for now and learning for
the future. Long Range Planning, 43(2), 364-369.
Sanchez, P. & Ricart, J. E. (2010). Business model Innovation and sources of value creation in
low-income markets. European Management Review (2010) 7, 138-154.
Schaltegger, S., & Wagner, M. (2011). Sustainable entrepreneurship and sustainability
innovation: categories and interactions. Business strategy and the environment, 20(4),
222-237.
Seville, D., Buxton, A. & Vorley, B. (2011). Under what conditions are value chains effective
tools for pro-poor development?. Retrieved on 19th April 2017 from:
http://pubs.iied.org/pdfs/16029IIED.pdf.
Teece, D. J. (2010). Business Models, Business Strategy and Innovation. Long Range Planning,
vol 43 2010.
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