Business Model Dimensions Research Articles

Dynamic Cost-Benefit Analysis of Digitalization in the Energy Industry

Assessing the benefits and costs of digitalization in the energy industry is a complex issue. Traditional cost-benefit analysis (CBA) might encounter problems in addressing uncertainties, dynamic stakeholder interactions, and feedback loops arising out of the evolving nature of digitalization. This paper introduces a methodological framework to help address the intricate inter connections between digital applications and business models in the energy industry. The proposed framework leverages system dynamics to achieve two primary objectives. It investigates how digitalization generally influences the value proposition, value capture, and value creation dimensions of business models. It also quantifies the financial and social impacts of digitalization from a dynamic perspective. The proposed dynamic CBA allows for a more precise quantification of the benefits and costs, associated with evidence-based decision-making. Findings from an illustrative case study challenge the static assumptions of conventional methods. These methods often presume continuous operation, neglecting reinvestment and operational feedback loops, and resulting in negative net present values. Conversely, the outcomes of the proposed method indicate positive net present values when accounting for factors such as reinvestment rates and the willingness to invest in digitalization projects. The principles outlined in this paper can enable a more accurate assessment of digitalization projects, thus catalyzing the development of new CBA applications and guidelines for digitalization.

E-Business and supply chain integration is the ultimate online shopping

E-business has risen as a key empowering influence to drive supply chain integration. Organizations can use the internet to achieve worldwide visibility on their extended trading network. The influence of e-business on supply chain integration can be defined laterally the dimensions of information integration, synchronized planning, coordinated workflow, and new business models. An Important value can be added to e-business by enabling supply chain integration. In this report, the author has taken a popular rising e-commerce company from Bangladesh. The name of this company is AJKERDEAL. It is a Bangladeshi online retail company, that focuses on a low-cost-oriented supply chain to maintain cost efficiency. The company's success is attributed to its superior supply chain practices over local competitors. However, Western multinational retailers may struggle in Bangladesh due to their differing values, cultures, and beliefs, potentially jeopardizing their key market.

Sowing the seeds for sustainability: A business model innovation perspective on artificial intelligence in green technology startups

In today's data-driven era, ubiquitous concern about environmental issues pushes more startups to engage in business model innovation that promotes environmentally friendly technologies. The goal of these startups is to create technology-based products and services that enhance environmental sustainability. In this context, artificial intelligence promises to be a key instrument to create, capture, and deliver value. However, the existing literature lacks a deep understanding of how startups using AI innovate their business models to achieve a positive environmental impact. Therefore, this paper investigates how green technology startups utilize AI from a business model innovation perspective for environmental sustainability. We conduct a qualitative, exploratory multiple-case study using the Eisenhardt methodology, based on interview data analyzed using qualitative content analysis. We derive five predominant manifestations for AI-driven business model innovation and identify archetypical connections between business model dimensions. Further, we establish three overarching archetypical associations among the cases. In doing so, we contribute to theory and practice by providing a deeper account of how green technology startups attempt to maximize their positive environmental impact through AI. The results of this study also highlight how business model innovation driven by AI can support society in securing a more environmentally sustainable future.

Implementing a circular business model for reusable packaging: Multidisciplinary learnings from reusable pizza packaging

This article explores practical challenges in developing and implementing circular business models in the context of reusable takeaway food packaging from a transdisciplinary perspective. It touches upon the desirability, feasibility, viability, and sustainability dimensions of a reusable pizza packaging circular business model. First, a literature review is conducted to highlight current knowledge and gaps around circular business models for reusable packaging and the key factors addressing the desirability, feasibility, viability, and sustainability. Second, a case study approach is taken for an in-depth exploration of these factors and their effect on the successful implementation of a reusable packaging business model. A real-life pilot is structured and implemented; questionnaire, workshops and semi-structured interviews with consumers and key stakeholders of the novel business model as well as technical laboratory tests of used packaging are used as key data sources in the case study. This study contributes to research and practice with a novel framework for circular business model innovation in the context of reusable packaging highlighting the need to iteratively address packaging as well as system conditions affecting the desirability, feasibility, sustainability, and viability of such ecosystem-based business models. Future research should inherently take a systemic perspective to address interconnections between these four dimensions and explore in which steps and order experimentations should be developed to balance trade-offs between feasibility and desirability while ensuring sustainability and viability of the business model.

Circular Green and Sustainable Business Model Competence Innovation and Development: Challenges with Privacy and GDPR Related to Businesses and Research

Increased focus and vision on faster circular green and sustainable transformation in businesses and research have now turned out to be highly linked to also the social and the competence dimension of “the triple bottom line” approach and measurements. The social economic part of the triple bottom line approach has shown to be increasingly important, but very challenging to operate under the existing Privacy and GDPR regulations. To fulfil and measure how green the human, organizational systems and culture competence components actually are in business models today is not that much investigated. Focus has more been on “greening” the technology part of the competence components but now a number of advanced technologies seems promising to help measure green competences. It opens up for measuring circular, green and sustainable business model competences in some new and more advanced ways, but it could potentially result in the business do not comply with Privacy and GDPR regulations. Ever since the branching of the scholarly literature on competences of the early 1960’s businesses have constantly being experimenting with business model competence design, reengineering, development and measuring. Creating Green Business Model (GBM’s) competences is no exception. Designing TO BE GBM’s and reconfiguration of AS IS BM’s to become GBM’s and later develop these is in focus – but until now the main focus has been on greening technologies. Very few knows how to “greening” and measure green related to human competences, organizational systems and culture. GBM competence reconfiguration has also mainly focused on changing or reconfiguring AS IS Business Models technology competences. More and more businesses have realised that investing in new technologies or changing existing technologies are not enough to reach the vision and goals of green transformation. Technologies alone cannot release the full potential and requests of green transformation – reduce the use of material and resources, reduce the waste and spill, reduce the pollution including Co2 and increase biodiversity. The Business will simply not by technologies alone be able “to climb” and “pass” “the Green Wall” without innovating, developing the BM competences – HR, Organizational systems and Culture into becoming greener and thereby support green transformation in the businesses. Reconfiguring AS IS business model competences to become greener is complex and calls for new and advanced approaches that challenge classical BM competence frameworks and understanding. Green Parameters and Profit are no longer the main focus in GBMI and changing some BM dimensions and components – or even adding new business model dimensions to the BM is neither enough. If business want to remain competitive, efficient and at the same time green, it requires a different GBMI approach and mindset – including measuring BM Competences. This challenges the compliance of Privacy and GDPR related to both businesses and research. The request for circularity and sustainability just adds to the complexity of measuring. We offer a review of three Privacy and GDPR GBMI compliance cases and challenges in three different businesses with the aim of achieving greater understanding of Privacy and GDPR challenges both for businesses and researchers. We identify issues behind the apparent challenges of Privacy and GDPR in GBMI and discuss how strategic GBMI can contribute to further research on Privacy and GDPR in different fields of Green Business Modelling, offering future research directions of Privacy and GDPR.

Identification and Prioritization of Religious Mental Models Influencing the Business Model

Objective: The primary objective of this study is to identify and prioritize the religious mental models that influence business models among Iranian Muslim entrepreneurs. Methodology: The study employs a mixed-method research approach, combining qualitative and quantitative data collection methods. Data were gathered through interviews and questionnaires. The interview sample consisted of 13 entrepreneurs from the city of Mashhad, while the questionnaire sample included 21 faculty members from management disciplines at Adib Mazandaran Institute of Higher Education. The collected data were analyzed using Excel and MICMAC software to identify and prioritize the key dimensions of religious mental models that influence business practices. Findings: The study identified eight key dimensions of business models influenced by religious beliefs: business ethics, stakeholder importance, cultural context, institutional context, family-centeredness, customer orientation, the divine meaning of business, and business skills. Among these, business ethics, family-centeredness, and the divine meaning of business were found to have the highest priority. These dimensions reflect the deep integration of religious values into business practices, with a strong emphasis on ethical conduct, the centrality of family, and the spiritual significance of business activities. Conclusion: The findings underscore the critical role that religious beliefs play in shaping the business models of Iranian Muslim entrepreneurs. Business ethics, family-centeredness, and the divine meaning of business emerge as the most influential dimensions, highlighting the importance of aligning business practices with Islamic values.

Enabling battery circularity: Unlocking circular business model archetypes and collaboration forms in the electric vehicle battery ecosystem

Achieving battery circularity is crucial for meeting the targets of net-zero emission vehicles by 2030 and enabling climate-neutral transportation by 2050. To facilitate this transition, firms operating in the electric vehicle (EV) battery ecosystem must reassess their value creation, capture, and delivery methods. Although EV battery second life presents a promising solution for circularity, many vehicle manufacturers and stakeholders in the battery ecosystem struggle to adapt their organizations internally and externally due to a lack of insights into suitable circular business models. The purpose of this study is to identify viable archetypes of circular business models for EV battery second life and examine their implications on company collaborations within the EV battery ecosystem. Three main archetypes of circular business models are identified (i.e., extending, sharing, and looping business models) and further divided into eight sub-archetypes. These models are elucidated in terms of key business model dimensions, including value proposition, value co-creation, value delivery, and value capture. The paper provides visual representations of the necessary interactions and collaborations among companies in the EV battery ecosystem to effectively implement the proposed business model archetypes. This research contributes to the theory of circular business models in general, with specific relevance to EV battery circularity.

Linking Effectuation Logic with Business Model Innovation: An Investigation in the Context of Swiss Startups

Over the last decades, business model innovation and effectuation have been widely discussed in the literature. While effectuation represents a behavioural approach for entrepreneurs using available means for founding a start-up, business model innovation represents an approach to creating a business model with long-term competitive advantages. Designing a business model requires to focus on four dimensions: customer, value proposition, value chain and revenue mechanism. A business model innovation is referred to when an innovative characteristic can be attributed to two of the four dimensions. Both effectuation and business model innovation are valuable for entrepreneurs who are pursuing growth in dynamic and uncertain business environments. This paper elaborates on effectuation and its potential effects on business model innovation. The addressed research questions are: Is the effectuation logic a facilitating aspect of business model innovation? And to what extent do entrepreneurs apply effectuation logic and design innovative business models? The underlying data consists of business plans of 25 finalists of a Swiss innovation competition with more than 100 startups from different business sectors every year. First, the chosen sample is reviewed on the extent of the application of effectuation based on selected behavioural criteria. Second, the sample is analysed for evidence of business model innovation based on the above-mentioned business model dimensions and their innovative potential. Third, the link between the two approaches is highlighted to gain insights into the potential influence of the applied decision logic to develop innovative business models, thus providing an understanding of how entrepreneurs could leverage the advantages of effectuation in the context of innovating the business model. Further research will focus on examining critical success factors of entrepreneurial behaviour in the applied business model types and their correlations with business performance.

Key performance indicators for business models: a systematic review and catalog

Organizations continuously adapt and innovate their business models to remain competitive. To support the management of business models throughout their lifecycle, Key Performance Indicators (KPIs) related to business models play an important role. However, the current research on business model KPIs is dispersed and lacks clarity on how they are defined, concretized, and managed throughout their lifecycle. Therefore, we conducted a systematic literature review to analyze and consolidate the current state of the research on KPIs for business models. We identified 35 relevant publications and classified them in a concept matrix consisting of five categories related to business models and KPI management. In addition, we synthesized the business model KPIs referred to in the literature into a catalog structured by business model dimensions. Based on our review and analysis, we formulate avenues for further research on KPIs for business models. Practitioners can use the overview of available approaches for business model KPI management and the catalog of business model KPIs to effectively manage and define KPIs for their organization’s business models.

Exploring the automotive transition: A technological and business model perspective

The automotive industry is currently undergoing a radical transition. This transition is a complex process that depends on many factors, especially technologies and business models. This process started many years ago, but it is still associated with a high uncertainty level. With regards to powertrain technologies, it is not clear which technology will be dominant in the future. Will it be the Battery Electric Vehicle (BEV) or the hydrogen-based Fuel Cell Electric Vehicle (FCEV) that will achieve a higher level of diffusion? Regarding business models, despite extensive research, the business models that will support the automotive transition are far from clear. Therefore, this research, based on a two-stage interview study, addresses both perspectives: technology and business model. Three possible options for powertrain technologies are identified: (i) coexistence of BEVs and FCEVs, (ii) BEVs, but conditional introduction of FCEVs, and (iii) BEVs only without FCEVs. In addition, the results show that business model innovation in the automotive industry can be driven by many aspects such as management vision, market, competition, future trends, battery, charging technology and infrastructure, as well as digital technologies and services. By combining the powertrain technology and business model dimensions, four future scenarios for the automotive transition are proposed: simply BEV, technology diversification, service-oriented BEV production, and maximum versatility. An expert evaluation allows the scenarios to be prioritized according to their likelihood of occurrence. The results show that the service-based BEV-scenario is the most likely one. Nevertheless, the differences between most and least likely scenarios are not large enough to disclose a clear trend, confirming the diffuse situation in the industry.

Disentangling the complex longitudinal relationships between business model innovation and firm performance

Despite the increasing interest in business model innovation (BMI), the literature lacks solid empirical evidence about its impact over time. We address this gap by taking an element-based perspective, differentiating three core dimensions: value creation, value proposition, and value capture. We collected cross-industry data based on more than 35,000 press releases, capturing over 2,300 events of BMI from 60 German publicly traded corporations, and regressing them against firm performance measures. Our findings show that BMI has a positive, albeit lagged effect on firm performance. We further find substitutive as well as complementary effects of the different business model dimensions. Moreover, concentrated BMI activities outperform BMI activities dispersed across different business model dimensions when it comes to subsequent firm performance. Our findings contribute to the literature by stimulating a deeper reflection on the role of resource allocation, highlighting the need to carefully plan BMI activities at the level of strategic management.

Digital Transformation of Incumbent Firms: A Business Model Innovation Perspective

The literature argues that a real digital transformation of firms requires holistic changes of the business model. Despite knowledge about this ambitious goal, understanding of how digital business model transformation can be achieved is still very limited. In this article, we explore how firms achieve digital business model transformation. We apply a case study design to investigate how incumbents have changed their respective business model dimensions during digital transformation. Our findings center on interview data and complementary archival records from 15 cases. We present a framework for digital business model transformation along the dimensions of value proposition, value creation, and value capture. Our results emphasize the importance of a preparatory phase in which the strategic course is set. Furthermore, our findings demonstrate that transforming a company's business model is most effective when a single person, namely the Chief Digital Officer, is responsible. Our findings contribute to the business model literature, by providing a more holistic view on how business model innovation can be utilized during digital transformation.

Designing business models for Industry 4.0 technologies provision: Changes in business dimensions through digital transformation

Industry 4.0 (I4.0) literature has been concerned with how to implement digital technologies in manufacturing processes. However, the I4.0 concept also comprises broader changes in the company's business model (BM) through digital transformation, which deserves more attention, especially from the technology providers' perspective. As they are essential to advancing the digital transformation diffusion and creating I4.0 ecosystems, their business model innovation (BMI) in this context is a keystone for I4.0. Thus, we consider how changing factors in the I4.0 context affect the business model dimensions of technology providers. We analyze changing factors in the three main BM dimensions: front-end, back-end, and value proposition. We study ten I4.0 technology providers and explain the mechanisms of change involved in their BMI, explaining how and why such changes happen. The findings provide practitioners with insights to anticipate the necessary actions to manage and incorporate such changes, whether they rely more on data and IoT devices, new BMs such as training and consulting, dynamic pricing forms, new software/hardware, or service competencies. We also provide a detailed analysis of elements of change in the BM that can be used in theory to understand better the different digital transformation impacts in the Industry 4.0 context.

Social bricolage and social business model in uncertain contexts: insights for the management of minor cultural heritage in Italy

PurposeThis paper aims to analyse how social entrepreneurship organizations that use approach of social bricolage adapt their business model to develop social innovation. The past decade has witnessed a surge of research interest in social entrepreneurship organizations (SEOs). This has resulted in important insights concerning their role in fostering social challenges. The crisis of both public and private profit-driven models meet the arising of new initiatives designed to meet the minor and often abandoned cultural heritage consumption need. Drawing on the domain of SEOs and social bricolage framework, these initiatives are able to pursue the social and the economic mission together and to produce social innovation.Design/methodology/approachThis paper aims to analyze how SEOs that use strategies of social bricolage can improve the development and diffusion of social innovation. Employing in-depth multiple comparative case studies of 15 cultural SEOs in the South of Italy, through the analysis of semi-structured interview, the study enhance current understanding of the social dimension of SEOs.FindingsFirst results show that SEOs in the domain of minor cultural heritage adopt an innovative business model and in particular a social business model unraveling organizational dimensions falling into the social bricolage. The relation between social bricolage dimensions and social business model criteria produces outcomes in which social innovation can be expressed.Originality/valueThis study enhances current understanding of the social dimensions of business model involved in social innovation production of cultural SEOs. This research aims to be a benchmark of the social innovation initiatives in the field of minor cultural heritage management.

Formulation of Proxy Measures: Measuring Business Model for Improving Competitiveness

This paper attempts to develop proxy measures for the business model dimensions (BMDs). In the empirical studies, the primary data with the survey method are not feasible, in some cases. Because either the data required are from distance past or measuring the construct without respondents’ biases is not feasible. The process started with indicators for each business model dimensions and logically linked these indicators with the tactical decision, strategic imperatives and finally to the elements from financial statements. These linkages were developed with the help of four experts and the validity of the same was tested with more experts. Additionally, the validity of the proxy measures was assessed using correlation analysis and paired sample t test. All the validation tests confirmed the suitability of proxy measures for the four business model dimensions. The measures developed in this paper will help academician to conduct the longitudinal studies. On practice front, these measures may help managers to analyze the firm’s performance or competitiveness with reference to BMDs. The current literature is still evolving when it comes to measuring the constructs related to business model dimensions. This paper is an attempt to contribute in that direction.

Business Model of Peer-to-Peer Energy Trading: A Review of Literature

Peer-to-peer (P2P) energy trading is a promising energy trading mechanism due to the deployment of distributed energy resources in recent years. Trading energy between prosumers and consumers in the local energy market is undergoing massive research and development, paying significant attention to the business model of the energy market. In this paper, an extensive review was conducted on the current research in P2P energy trading to understand the business layer of the energy market concerning business model dimensions: bidding strategies and the market-clearing approach. Different types of game theoretical-based and auction-based market-clearing mechanisms are investigated, including a detailed classification of auctions. This study considers the possibility of employing the P2P technique in developing countries and reviewing existing business models and trading policies. The business layer of the P2P structure plays a vital role in developing an effective trading mechanism based on interactive energy markets.

Agility and Resilience in Social Enterprises - A Case Study Approach

Covid-19 exposed various existing business organizations and start-ups to sustenance risk. The dynamics of the business environment changed drastically at an unprecedented rate wherein resilient organizations survived the blow. There is an increased need of exploring new dimensions of business models which serve the socio-economic motive for communal development thinking beyond profits but are agile to adopt latest technology and innovations serving the bottom of the pyramid. The study exhibits the resilience and agility of social enterprises during current challenging times of pandemic Covid-19 through a case study approach. The research throws light on actions and strategies adopted by social enterprises working in the handloom sector of central India for supporting the marginalized community with short term and longterm strategic measures discussing the challenges faced by three social enterprises (handlooms). It also discusses the strategic importance of social entrepreneurship in developing economies in such challenging times to provide sustainable value creation and social upliftment.

Business models transformation of Russian airlines: Influence of the coronavirus crisis

The article discusses the business-model transformation of Russian airlines in 2020 and for the first half of 2021 caused by the impact of the COVID-19 pandemic. Research interest in Russian air transport market is considerable due to its heterogeneity in terms of airline business models, the level of federal (regional) regulation, passenger traffic on different routes. The theoretical part of the study analyzes approaches to defining airlines business-model. The pattern of business model by J. Daft and S. Albers based on a quantitatively defined finite set of carriers’ characteristics is most appropriate for the objectives of the study. Due to lack of primary data the empirical part is based on the media coverage of Russian airlines in the period of 2020 and 2021. The data was verified using text analysis methods in SPSS Modeler and primary data on the operational activities of airlines. Further, through a series of expert panels, which included representatives of airports and airlines, the number of carriers’ media coverage was arranged into components and dimensions of business model. It was found that the actions of Russian and foreign airlines differed according to the territorial and institutional characteristics of the Russian air transport market. There was a transition to direct regional flights, the expansion of the customer way and the competition between carriers based on a set of available services. With the novelty of the study, the conclusions are limited because the analysis based on media coverage does not reveal a full range of reactions of airlines, in particular, internal transformations which companies do not report. The results can serve as a pattern for the formation of industry monitoring of airline reactions, as well as a starting point for studying the sustainability of changes in the business models of Russian airlines.

Priority Weights for Predicting the Success of Hotel Sustainable Business Models

This study proposes the use of consistent fuzzy preference relations to evaluate the structure of hotel sustainable business model (HSBM) dimensions and the corresponding hierarchy of evaluation indicators, and predict the overall probability of success. As fuzzy preference relations require, a group of hotel professionals in Taiwan was asked to process pairwise comparisons using linguistic variables to determine the weights of dimensions and indicators. According to the results, finances were found to be the most important dimension, followed by human capital. The number of local cultural events in the hotel was identified as the most important indicator. The predictive values revealed the possibility for successful HSBM implementation, shedding light on the vision of sustainability for the hotel industry. The results of the present study contribute to the literature on sustainability by determining the importance and weights of dimensions and indicators for hotel business models, providing an example of the use of this strategic tool in generating and modifying sustainable business models for the hotel industry.

Which sharing are we betting on? Analysing the financial attractiveness of sharing business models

The study aims to explore the interaction between business model dimensions and the financial attractiveness of sharing economy platforms, to understand if business models with certain dimensions are more able to attract investment. The research has been developed taking into account the difference between true sharing and pseudo-sharing, to establish to which type of sharing economy platform more investment has been directed to date. The main dimensions of sharing economy business models were identified from the literature. These variables were used to classify the business models of 161 sharing platforms. A one-way ANOVA was performed to infer results.Results from the analysis show that business models that offer rational benefits; increase the utilization of durable assets; have a C2C process and adopt a transaction model, have received more funds. In conclusion, the research suggests that different sharing business models can affect the financial attractiveness and the empirical results show that “pure exchange” platforms are more financed compared with the “pure sharing” platforms.