Service-centric Business Model in Cloud Environment

Abstract

The development of Cloud Computing drives the change of value creation towards services and creates a new networked economic structure for challenging organizations to adapt their existing business models. Despite agreement on that the transformation of business model is importance to an organization's success, the evolution of business model enabled by Cloud is still fuzzy and vague within many research fields including both Management Strategy Theory and Information Systems. This paper, following a review of existing works and a series of case studies from several typical industries, employs a deductive reasoning method to investigate the influence of cloud computing on business model evolution and presents a specific service-centric business model. First, the evolution of business model in cloud environment is developed. Second, by analyzing business model innovations on business model nine building blocks in cloud environment, the element of service-centric business model is defined. Then, an ontological framework which includes value, service, and business model dimension for service-centric innovative business model is proposed. Finally, several industrial cases validate that this paper provides a comprehensive framework of organization's business model which can properly reveals an organization's complex nature of business logic and operation management in cloud environment.