Key Business Model Research Articles

Evaluation of sustainability of business models of Scandinavian bank subsidiaries in the Baltics

Using the system of key business model indicators, the sustainability of business models of Scandinavian bank subsidiaries in the Baltics is analysed. The aim of the research is to assess if banks keep on doing their business as they are currently, will they continue generating acceptable returns over three years; and to detect key material vulnerabilities.

Only the Brave: Product Innovation, Service Business Model Innovation, and Their Impact on Performance

Recent empirical findings concerning the performance effects of service business model innovation (servitization) and its interplay with product innovation are mixed. Using the lenses of the demand‐based view on value creation and complementarity, the performance impact of two key service business models is examined: the product‐oriented model and the customer‐oriented model, implemented jointly with product innovation. Results indicate that the interplay between service business model innovation and product innovation results in long‐term performance benefits coupled with a degree of short‐term performance sacrifice. Service business model innovation in isolation from product innovation results in short‐term profit gains but long‐term knowledge loss and, thus, market performance decline. Our study suggests that firms need to look beyond the evidence on short‐term effects in order to achieve superior performance in the long run.

Case study, dynamic capabilities and upstream strategy: Supermajor EXP

This case study explicates the dynamic capabilities framework and shows its relevance for the Global Exploration Division of a major IOC, Supermajor EXP. Three characteristics of dynamic capabilities are described: (1) how they differ from ordinary capabilities; (2) how they are identified, built and strengthened through managerial processes; and (3) how they function throughout the strategy development and execution process (sensing, seizing and transforming). Over a one-year period, EXP implemented key organizational and business model innovations to identify and begin to manage 10 dynamic capabilities. The case demonstrates how EXP identified and prioritized their dynamic capabilities through a strategic assessment, built, strengthened and evolved them through dialogical, collaborative and iterative processes that were informed by learning, sustained them by establishing new organizational structures, and reinforced them through cultural initiatives. Three of EXP's dynamic capabilities are described in detail: (1) accuracy in volume and risk predictions in investment proposals (the degree to which the subsurface reality is exposed when the well is drilled); (2) strategic deployment of talent into the ventures and projects with the highest economic value (right people, in the right seats, doing the right thing, with the right people, at the right time), and (3) effective management of the centralized–decentralized polarity.

Open innovation, networking, and business model dynamics: the two sides

A business model describes the design of the value creation and capture mechanisms needed to yield profit. We contend that for a business model to be viable in turbulent and hypercompetitive environments, its dynamics are important and must leverage, out of all key business model modules proposed in different studies, on a combined value and network perspective. These different elements present, however, distinctive challenges for small innovative companies and larger firms. Moreover, the business model of small firms is sited in the business models of their partners, big companies in particular. The purpose of this article is to highlight the importance of a dynamic network perspective and to understand how the networked business models in action of large firms may affect small innovative companies. We examine here the networked business models of big pharmaceutical companies and venture capital firms which interact in open innovation with small biotech companies.

Smartphone Apps on the Mobile Web: An Exploratory Case Study of Business Models

The purpose of this research is to explore the business strategies of a firm seeking to develop and profitably market a mobile smartphone application (‘app’) to understand how small, digital entrepreneurships may build sustainable business models given substantial market barriers. The case study describes two distinctly different business models adopted in succession by one firm attempting to successfully commercialize its mobile app, as well as the various adjustments the firm makes to three key business model mechanisms: 1) its value proposition to the selected target market 2) its value chain configuration and 3) its customer acquisition cost structure. This research looks closely at business-to-consumer (B2C) and business-to-business-to-consumer (B2B2C) distribution arrangements for mobile apps and in doing so challenges the rising positive bias that exists for the app store as the dominant actor in the mobile value chain. This research extends earlier frameworks of ebusiness model value derivation by suggesting new contingency aspects found in the mobile application development sector. For practice, this research suggests business model viability in the mobile sector may be closely related to decisions in targeting, value chain configuration and use of mobile advertising. As strategic uncertainties are a common situation in emerging industries, this paper offers practical strategy tips to improve business model sustainability and may be useful to start-ups, digital entrepreneurships, developer communities or others seeking to profit from the global smartphone diffusion.

Opportunities in the Transforming Digital China

The paper aims to discover the most promising digital networking business opportunities in today’s Chinese market, and how those new opportunities relate to the collective social networking culture rooted in Chinese consumers and businesses. The paper analyzes the enormous digital business environment in China for e-commerce, digital marketing, e-learning, consumer behavior, IT outsourcing, software development and innovation. The analysis discovers huge opportunities in China’s digital social business that leverages the collaboration culture for both consumer and business audience. A classification to China’s digital audience and current key global and domestic players in the digital market are provided. The market is still far from maturity with an enormous growth rate. Although local players dominate the market, new market entry depends primarily on new digital product features that leverage social interaction and networking. Current key players copy Western social networking business model style without taking advantage of China’s collective culture. The market size is huge, however, concentrated in urban areas and for specific income levels. The research finds opportunities in consumer digital social shopping, mobile social shopping and professional digital networking. The paper provides implications and recommendations for international and domestic investors that include ideas for new digital products and market penetration strategies.

State Transformation, Policy Learning, and Exclusive Displacement in the Process of Urban Redevelopment in Taiwan

This paper explores the dynamics behind the changing regimes of urban renewal and its social impacts in Taiwan. Before the 1980s, the state was willing to solely shoulder the job of urban renewal with a wholly supportive financial budget and land appropriation law, while in the 1990s it became financially overburdened due to its renewal policy. Around the year 2000, the state turned towards promoting urban regeneration as a key business model. Through this historical exposition, the Taiwanese story of state transformation in urban renewal policy brings two issues to the fore. The first issue is the learning process concerning the policy of public-private partnership (PPP) initiatives. Trans-border policy mobility connects and constitutes cities, such as Taipei, with other places, such as London, through visits and seminars attended by policy makers and experts. However, policy transferred from abroad is “localized” in the learning process and used to prioritize the regeneration of public lands in the urban area. The PPP model is transformed in the face of domestic political struggles. The second issue is the social exclusion as a result of property-led regeneration. Rather than playing the role of an impartial institutional moderator, the state privileged landowners and developers and sacrificed the rights of tenants to stay put. By doing so, the state secures political support from landowner-cum-citizens and initiates a political culture of property in which local citizenship is predicated on ownership.

Technology Provisioning in the Mobile Industry: A Strategic Clustering

This article develops a strategic clustering for Mobile Middleware Technology Providers (MMTPs), shedding light on the business models and the strategic positioning currently adopted by this actor typology. The paper combines a literature review and a multiple case study approach – 24 in-depth cases based on 72 semi-structured interviews were performed – to deal with a significant and relatively new issue, i.e., the role of technology providers in the mobile value network. Through the creation of a system of strategic clustering matrices, four key business models currently adopted by MMTPs – “Pure Play”, “Full Asset”, “Third Parties Relationship-focused” and “Platform and Content Management” – are identified, and insightful conclusions on the impact of this actor's newly emerging influence on the market's competitive dynamics are drawn. The framework created supports a wide set of mobile communications stakeholders – both incumbent and new entrants – in their decision making and strategy analysis process.

Is a Multi Disciplinary Practice Model the Key Feature of a Professional (As Opposed to Merely Regulated) Financial Planning Practice?

The objective of this paper is to describe a number of key business model impacts on financial advice practices when attempting to comply with the best interests test in the currently proposed (as at October 2011) form of s.961C of the Corporations Act 2001 (the Act).The paper first argues that with the introduction of s.961C of the Act as the successor to s.945A & B, the previous practice of assuming as axiomatic that the know your client obligations in s.945A and B were qualified by the personal financial advice provisions of the Act in s 766B, is no longer relevant to the legal compliance obligations under the Act of financial advisers.The paper then argues that a consequence of the introduction of s.961C is the creation of an estates practice context for financial planning that needs to operate in conjunction with financial planning in a way similar to the emerging taxation practice context for financial planning.s.961C is intended to mediate the provision of financial products and services to retail clients in the community. The advantage sought by the client from the administration of their affairs is now, subject to the scaled (scoped?) advice provisions of the law and professional practice, the primary objective for the delivery of a financial advisers’ services. The skills and resources that a financial adviser must bring to an engagement is substantially expanded by the operation of s.961C. It is the expansion of the skills required to discharge obligations under s.961C that has the most direct business model impacts on financial advisers and their employers. That expansion does not necessarily mean that a multi disciplinary business model must be adopted as the defining feature of professional financial planning practices. Sales oriented business practices are challenged by the requirement of compliance with the Australian Consumer Law as well as s.961C. As financial planners embrace a broader range of services to justify their fees such as direct property investment, wealth preservation and estate administration, the notion that a financial planners business is just about providing mediated access to appropriate financial products and services is rapidly eroding.FOFA represents a tipping point in Government policy towards financial advisers focused on shifting the advisers relationship with the client from a perceived role as agent (in at least part) of the financial product or service provider to now a role of being only the purchasers agent or client adviser with the authority and knowledge of the client’s situation that inherently shapes and controls the client’s ability to acquire and use financial products and services.Advisers will need to either inhabit a very restricted financial service provision domain that is supported by very strict engagement limitation controls or embrace the need to comprehensively define the needs of the client and develop the cross disciplinary professional associations to allow the needs of the client outside the core competence of the planner to be competently serviced. It is in this distinction that I think we find the distinguishing features between the regulated and professional financial planner.

Intellectual capitals, business models and performance measurements in forming strategic network

How firms identify the intellectual capitals, business models and performance measurements for forming a strategic network with competitors? Both intellectual capital and coopetition strategy have become heated issues in strategic management field. Firms involved in cooperation with competitors should not only design their collective business models but also dedicate their intellectual capitals to create performance. Linking intellectual capital perspective, business model, and performance management, this paper aims at answering three questions: What are the intellectual capitals required to form a strategic network with competitors? What is the collective business models designed for cooperative strategies? And what are the performance indicators for measuring the collective business models? In this study, we have investigated a supermarket strategic network. We conducted an in-depth face-to-face interview with 14 CEOs in the network. They, together, have defined five key business models and developed important intellectual capitals necessary for implementation of the business models. They also have identified critical performance measurements. This practice-oriented study contributes a more complete understanding of intellectual capital, business model, and performance measurement in forming strategic network.

Business models in project-based firms – Towards a typology of solution-specific business models

Project suppliers are taking increasing responsibility for their customers’ businesses by servicing and operating their installed base of equipment. Simultaneously, the locus in value creation in the project suppliers’ deliveries and business models has changed from short-term project deliveries to also include the operation of systems. We analyze five solutions delivered by a power plant supplier firm. The term ‘solution’ here refers to an offering which includes a project component and an after-delivery service component. We assess the distinctive features in the business models of the solution deliveries. This paper contributes to the existing knowledge by suggesting use of solution-specific business models with six key business model elements and by developing a typology of five solution-specific business models. The typology can also be used for assessing the performance of individual solutions. Our suggestion of a solution-specific business model is especially novel in the research of integrated solutions and business models: although existing literature argues that on a general level a firm can have several business models, prior research has not suggested the use of project-specific or solution-specific business models. Therefore, our finding of solution specificity of business models contributes significantly to the existing knowledge.

Barcode enabled m-commerce: strategic implications and business models

This paper provides background on the use of barcodes for the provision of mobile commerce (m-commerce) services. It presents three cases where this technology has been used in Japan, New Zealand and the UK. Subsequently, these are used as the basis for a discussion and analysis of the key business models and strategic implications for particular markets. The paper concludes with predictions for the market and directions for future research.