Abstract
AbstractA transition from a linear economy to a more sustainable and circular economy requires different business models. In this chapter, we provide you with an introduction to the nature and logic of business models. In essence, a business model is a description of how value creation between parties or partners is organized, at a particular moment, in a specific context, and given available resources. Conventional business modelling approaches have several weaknesses—the main point of criticism being their focus on creating financial value. With the Business Model Template (BMT), we try to resolve most of these criticisms. To do so we introduce three archetypal business models: the platform, community, and circular economy business models. This chapter provides an overview on how, over three stages and ten building blocks that together make up the Business Model Template, these archetypal business models will be used.
Highlights
We move from organization-centred to network-centred or loop-centred value creation, retention, and capture, which leads to a fundamental revision of the logic of value creation
Logic of value creation: The first element describes the logic of value creation or the value proposition, answering the question What value is created for whom? The implicit outcome of this—certainly with conventional business models—is almost always the dominant pursuit of positive financial results
In the BMT, we add a fourth element to the traditional business model framework: impact, which refers to the impact the business model has on ecology and ecosystems, society, inclusivity, and the economy (Fig. 2.1)
Summary
Value creation is the core of a business model and is the shared task of the actors involved in the delivery of a business model. 1. The purpose of the BMC is to clarify how an organization creates value to make the core building blocks of a business model visible (Osterwalder et al, 2010). The criticism of traditional business models and associated toolkits has resulted in all kinds of adjustments and extensions being proposed, but these lead to existing business or value propositions being greened This approach fits in well with the ideas underlying conventional business modelling because it aims to develop products and services that are better, faster, more economical, and preferably cheaper than those of the competitors. There is no revenue for the volunteers, making it hard to reward their time, nor are the people who collect the vegetables compensated for their modest travel costs To make this initiative viable into the future they need a model that can create value for the volunteers either financially or in some other way. The originators of this project lack the knowledge and tools to make a business model for this case—can you take this example and explore what incentives and values could be created? For inspiration see the case study on Cargonomia, a cooperative initiative in Budapest: www.climate-kic.org/insights/cargo-bikes-conviviality-and-con scious-food-creative-partnerships-and-the-circular-economy
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