Power Ledger Business Model Analysis: MGMT20143 Assignment 2

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Central Queensland University, Australia
Term – 2019
MGMT20143 ASSIGNMENT 2
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1

Contents
Introduction......................................................................................................................................3
Issues of the customers or markets in the existing business model and innovation need...............4
Benefits to the customers from the new idea...................................................................................5
The proposed Business model of Power Ledger.............................................................................6
Key interrelationships in the proposed business model...................................................................9
The critical success factor of Power Ledger Company.................................................................10
Assumptions and critical risks of proposed business model canvas..............................................11
Overall Feasibility of Idea.............................................................................................................12
Conclusion.....................................................................................................................................14
References......................................................................................................................................15
2

Introduction
This assessment is based on the company “Power Ledger” which is the company of Australia
based on the blockchain cryptocurrency and platform of energy trading, allowing for the
decentralized buying and selling of renewable energy. In this business report, the innovation
needs requirements and the problems of customers or market have been discussed. Benefits that
the customs are getting through the generation of the new idea has been argued, the proposed
business model of Power Ledger company has been discussed and critical success factors along
with the critical risks and assumptions have been identified. In the end, the conclusions are
provided.
3

Issues of the customers or markets in the existing business model and innovation needs
From the analysis of the existing business canvas model of Power Ledger, it is found that there
are certain issues including that the company should focus on expanding its target market by
adopting the various channels by which it can reach a large number of customers through the
adopting of different marketing strategies. The company also has to expand its revenue streams
so that the financial position of the company can be improved and key resources of the company
are not enough to meet the requirement of entering in a new business venture. The customers are
required to change their basic behavior or practices. The numbers of customers in the energy
sector are increasing with the passage of time which is also the issue of the company. The
innovation is of great importance for every company as the company can gain a competitive
advantage through innovation and can maintain its competitive position through this (Joyce, &
Paquin, 2016).
4

Benefits to the customers from the new idea
The new ideas will help the company in making its green branding image which will emerge as
the new revenue stream enhancing more customers to the company resulting in lowering down
the production costs of the company. Smart meters, energy bills, company websites will make it
easier for the customers to make the optimum utilization of the energy without any wastage. The
customers can provide the energy feedback and their complaints or suggestions can be posted by
them on the company’s websites and handheld devices which will make customers aware of the
services of the company. Different key resources introduction will improve the time management
of the company by which the company will be able to provide high-quality services to its
customers and will work systematically. The improved financial performance of the company
will enable the company in providing services at the reasonable prices to its customers, enabling
customers to get the best services at the competitive prices (Horváth, & Szabó, 2018).
5

The proposed Business model of Power Ledger
Key Partners
 National
Lifestyle
Villages
 Ocean Energy
 Vector Energy
 Ocean Energy
 Tech Mahindra
 DigitalX
 Bancor
 Murdoch
University
 Curtin Energy
 Greenwood
Solutions
Key Activities
 Peer-to-peer
trading of
regulated
electricity for
individual
users.
 Electricity
trading across
a grid and
manage the
demand and
supply of
electricity.
 Monetising
carbon and
renewable
energy.
Value Proposition
 To provide
world
community a
tool to explore a
new world for
energy
 To provide clean
energy available
to all at a very
affordable price.
Customer Relationships
 Personal
assistance
 Client Eccentricity
 Customer Service
 Advisory and
assistance
Customer
Segments
Government
Agencies
Retail
Corporations
Individuals
Energy
Companies
EV-
Automobiles
Key Resources
 Large
investment
sources
 Innovative
team and
ideas.
Channels
 the power port and
Grid Platforms
 Social Networks
 Call Centers
 Smart Metres
 Energy bills
6

 Government
Grants and
subsidize
services
 A tool of
energy
management
for optimizing
storage or
retrieving and
selling or
buying energy
in real times
 Urban
planning tool
supporting the
decision-
making for
estimating the
return on
investment on
various
renewable
supply options
of energy
 Future
building
development
and
redevelopment
 Company website
 Electricity and heat
distribution network
 For the feedback of
energy websites and
handheld devices
7

Cost Structure
 Charge, Fee, and Taxes
 Material and types of machinery
 licensing fees
 Operational Cost
 Salaries
 Marketing and sales
Revenue Streams
 Grants
 Investments
 Token Sales
 Interests
 Enhancing the green image of
the company resulting in making
more customers turning the low
cost of production
8

Key interrelationships in the proposed business model
There are nine components in the business model canvas and all of these components are
interrelated with each other as with the effective channels’ use Power Ledger Company will be
able to attract more and more customers due to which company can attract large customers
segments and with the different key resources Power ledger will be able to do its operations
systematically and its value propositions can easily be achieved by the company. The key
activities of the company depend on the value propositions. The revenue propositions of the
company enhancements will increase the financial position of the company as the company will
earn more revenue from different streams and with the green brand image the customer
satisfaction level will increase resulting in making strong customer base and customer loyalty
will increase with the effective and high-quality services. The revenue streams are inter-
connected with the customer segments and value propositions(Andrzej Tokarski.et.al, 2017).
9

The critical success factor of Power Ledger Company
Critical success factors are the strengths of the company and they work effectively at the time of
crisis of the company and help the company in gaining competitive advantage and growth.
Power Ledger Company has various critical success factors as the company is having a strong
financial position that will help the company in enhancements of growth, there is the strong
relationship the company is having with its customers and this will make the company extend its
market share by growing customer segments. The services of the company are very effective and
are of high-quality (Sort.et.al, 2018).
The time-management of the company is strong and this is the best part about the company
which will help the company in resolving various issues and challenges. The communication
policies of the company are such that it continuously maintains the communication with its
customers by providing the company’s websites and handheld mobile for feedback and its
employees are also provided with the two-way communication which will increase the customer
satisfaction level. The training processes and policies are regular and proper which helps the
employees to learn about the innovative technologies and services in the energy sector
companies. All these will make their strong contribution to the success and growth of the
company (Maqbool, & Sudong, 2018).
10

Assumptions and critical risks of proposed business model canvas
Assumptions at the time of developing a new business model of Power ledger is the stability in
the market, political stability, and support of employees towards the introduction of new key
resources in the company. The change will be welcomed by employees and they will accept the
changes and will contribute to achieving the business goals and objectives. Government policies
are stable and the country’s economic stability will help the company in making satisfying
customers (Dellermann.et.al, 2017).
There are various risks associated with the new business model of Power Ledger which includes
the following-
 Customers are required to change their behavior and basic practices
 Risk of taking advantage of the trends in the environment
 Importance of the company’s services to customers
 The growth potential of the target market
 Financial risks of the company
 Matching its financial performance with the companies of the same sector
 Increased number of competitors (Jacquet, 2014)
11

Overall Feasibility of Idea
Score(-5 to +5) The overall potential of the
Business Idea Based on Each
Part
Suggestions for improving
the Potential
Part 1
The extent to which company
is able to take advantage of
different trends in the
environment
Moderate (0) Introduce various innovative
services and technologies so
that the environmental
changes can cope up by the
company.
Service’s importance to
customers (Rytkönen, &
Nenonen, 2014)
Moderate (0) Handheld mobile and online
websites of the company will
help in getting feedback from
the customers and from the
employees so that
organizational structure can be
changed accordingly and
changes can be made in the
services of the company
Part 2
Industry’s growth rate
High (1) Analyses of the customer’s
demand and responses and
introduction of new and
innovation in its services
Operating margin of industry Low (-1) By providing high-quality and
attractive services
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