Types Of Business Models Research Articles

Uncovering the business value of the internet of things in the energy domain – a review of smart energy business models

In the energy industry, Internet of Things technologies emerge in the form of smart energy products, like smart meters, which are expected to reveal new business potentials and offer value for customers. Through attractive business models, such technologies can generate economic value. However, until now, the existing research has not comprehensively identified, analyzed, and grouped together smart energy business models. Moreover, the literature has not placed smart energy business models under the concept of smart products and services. To address this gap, we review the literature through an information systems lens and assess the status quo of research on smart energy business models, identify relevant business model types, and propose a research agenda for future research on Internet of Things-based business models in the energy sector.

Business models in facilities management value chains

Purpose This paper aims to identify typical sourcing strategies and business models in facilities management (FM) and map archetypes of value chains with complementary sourcing strategies and value chains. Design/methodology/approach The paper is based on literature and case studies from previous research. Theoretically, the paper takes a generic value chain as a starting point together with the recent ISO standard on sourcing process and a business model framework. A conceptual framework is developed and typical sourcing strategies and business models for FM are investigated. Archetypical value chains are established by a combination of sourcing strategies and business models. Findings The paper identifies eight archetypes of FM value chains divided in three groups according to whether the core business organisation occupies rented facilities and owned facilities or has facilities operation as a core business like serviced office providers, etc. Practical implications The results can be used on a general level by everybody who need to get an overview and understanding of the complex structure of the FM sector. Furthermore, the results can help all parties involved in the FM value chain to get a clearer understanding of their position in the chain and help them develop their sourcing strategies and/or business model, depending on their type of organisation. Originality/value While there is a huge amount of literature on sourcing in FM, there has only been limited research on business models and value chains in FM. The paper is original in combining an investigation of sourcing strategies, business models and value chains in FM.

Platforms in the peer-to-peer sharing economy

PurposeThe purpose of this paper is to examine peer-to-peer sharing platform business models, their sources of competitive advantage, and the roles, motivations and behaviors of key actors in their ecosystems.Design/methodology/approachThis paper uses a conceptual approach that is rooted in the service, tourism and hospitality, and strategy literature.FindingsFirst, this paper defines key types of platform business models in the sharing economy anddescribes their characteristics. In particular, the authors propose the differentiation between sharing platforms of capacity-constrained vs capacity-unconstrained assets and advance five core properties of the former. Second, the authors contrast platform business models with their pipeline business model counterparts to understand the fundamental differences between them. One important conclusion is that platforms cater to vastly more heterogeneous assets and consumer needs and, therefore, require liquidity and analytics for high-quality matching. Third, the authors examine the competitive position of platforms and conclude that their widely taken “winner takes it all” assumption is not valid. Primary network effects are less important once a critical level of liquidity has been reached and may even turn negative if increased listings raise friction in the form of search costs. Once a critical level of liquidity has been reached, a platform’s competitive position depends on stakeholder trust and service provider and user loyalty. Fourth, the authors integrate and synthesize the literature on key platform stakeholders of platform businesses (i.e. users, service providers, and regulators) and their roles and motivations. Finally, directions for further research are advanced.Practical implicationsThis paper helps platform owners, service providers and users understand better the implications of sharing platform business models and how to position themselves in such ecosystems.Originality/valueThis paper integrates the extant literature on sharing platforms, takes a novel approach in delineating their key properties and dimensions, and provides insights into the evolving and dynamic forms of sharing platforms including converging business models.

Energy Supplier 2.0: A conceptual business model for energy suppliers aggregating flexible distributed assets and policy issues raised

The ongoing digitalization of the energy sector opens up opportunities for novel business models which can help to overcome some of the challenges accompanying the sustainable energy transition. One necessity in a more decentralized energy system with high shares of intermittent renewables is the provision of flexibility. This paper empirically applies the business model generation approach of Osterwalder and Pigneur (2010) in order to enhance our understanding of these transition challenges. The insights gained indicate that the focus of business models in the electricity supply market has to switch to a customer-driven perspective. To this end, the conceptual business model of an “Energy Supplier 2.0” as a dedicated aggregator of flexible capacities on the household level is investigated, showing how a specific new energy business model can tap the potential of distributed flexible energy assets. We find that the aggregation of the inherent economic potentials of these flexibilities is suitable to provide additional revenue streams, support grid operators, and promote customers to become “prosumers”. Despite these promising advantages, we find in the case of Germany that the current regulation and policies need to be adapted to achieve a broader diffusion of this type of business model and offer suggestions on the implementation.

Business Model Design for Latecomers in Biopharmaceutical Industry: The Case of Korean Firms

Given high business risks and interdependency with various organizations in biopharmaceutical industry, business model has become a key element for firms that aim to be more sustainable and profitable. Despite its growing importance, research on the business model design in biopharmaceutical industry is limited. In particular, there is a lack of research dealing with business models or strategies for latecomers. In the face of drastic changes such as market expansion and patent expiration, there has been growing interest in latecomer’s business model in the biopharmaceutical industry. This study identifies different types of business model designs using hierarchical clustering. Based on an empirical study of 313 biopharmaceutical firms in Korea, we find three types of business models: business diversified research firm, non-diversified research firm, and mature firm. We then compare the general characteristics and performances of each cluster. The findings indicate that business diversification of biopharmaceutical firms is beneficial in terms of profit. This implies that the biopharmaceutical firms in latecomer countries such as Korea are recommended to consider business diversification for sustainable management.

A Comparative Analysis of Business Model Notations

Although there were many comparative literatures of Business Models, there were not clear comparison criteria. Therefore, these comparisons were fragmented based on different viewpoints. In general, questions on business models can be categorized by interrogatives. In other words, the interrogatives imply a set of key features of business model notations. The feature category of business models using the interrogative will provide a unified way to compare different business models. The paper first defines the fifteen key features of Business Model Notations with five interrogatives. Then we concretely compare typical Business Model Notations based on the key features. The result clarifies the difference of Business Model Notations by using the proposed comparison framework. The result also implies a method to choose appropriate business model notations by using a set of interrogatives which correspond to important questions on business models.

Industrial internet of things business models in the machine-to-machine context

This study analyzes Industrial Internet of Things (IIoT) business models in the machine-to-machine (M2M) context. Thereby, it develops a conceptual framework to categorize different types of business model innovation for companies operating in the M2M business space. Business model innovations tend to cross multiple industries and drive ecosystems in which smart objects facilitate business models and service applications that are incrementally or radically novel in terms of their modularity or architecture. Our framework identifies four distinct types of IIoT business models: (I) Company-specific business models, (II) Systemic business models, (III) Value designs, and (IV) Systemic value designs. Moreover, it sheds light on different abstraction levels of business model building blocks and exposes the characteristics and differences in the value potential between the four business models. Finally, we advance the idea of ‘value design’ referring to business models of multiple actors coupled together, ultimately resulting in complex networks and ecosystems of diverse things, processes, and companies.

Advancing quantitative rigor in the circular economy literature: New methodology for product lifetime extension business models

Research on product lifetime extension (PLE) is of emerging interest in the circular economy (CE), but the extant literature is deficient in various aspects. First, it lacks a systematic analysis of the structure which underlies organizational efforts to PLE. Second, the literature has overlooked the role of two key agents in circular economy, namely, businesses and consumers. Third, the literature lacks a systematic study of the product lifetime extension strategies. Fourth, although several studies have proposed taxonomies of organizations in the circular economy, they lack quantitative rigor, ecological validity, and generalizability. The purpose of this study is to address these deficiencies in the circular economy literature. Specifically, this article develops and empirically validates a methodology to classify a specific type of circular business model, namely product lifetime extension business models, involving organizations and consumers, to bring quantitative rigor to conduct and presentation of taxonomy research in the field of the circular economy.

Optimal portfolio choice for ship leasing investments

ABSTRACTWe develop an advanced portfolio analysis method to determine the optimal ship mix for a portfolio. A typical business model of a ship leasing firm is to acquire ships for charter income. However, transportation assets (such as ships and aircraft) are different from financial assets (e.g. stocks and bonds) as they are tangible and have a limited useful life. Thus, methodologies for financial portfolios cannot be simply extended to portfolios of transportation assets. Recently, ship leasing represents a non-traditional source of ship finance. A ship leasing firm can manage a certain number of ships across different ship types. Based on portfolio theory and industry-related evidence, we construct an optimal ship portfolio consisting of a manageable combination of carefully chosen ships. The expected return of the asset combination is examined with respect to various ship types and sizes. We quantify the freight risk for different categories of ships in different sectors to investigate the characteristics of ship portfolios. The estimation of such freight risk is of considerable interest to academics and practitioners alike, because determining the behaviour of freight risk has important implications for investment decisions regarding ships. Our portfolio method should strongly support the decision-making process involved in leasing ships.

Business model design and performance in nascent markets

Purpose The purpose of this paper is to investigate the nascent market settings from a business model innovation perspective with the research questions: How do incumbents and start-ups make sense of an emerging technology through business model design in a nascent market setting, and how does business model choice influence firm performance? Design/methodology/approach The authors have tracked the development of four case companies in the nascent electric vehicle market from 2009 to 2018 and have conducted interviews and analyzed the archival data. Findings The authors propose a typology of business model choices and performance where the four types of business models distinguish themselves by how the companies innovate or imitate the value proposition of the current industry as well as how they innovate or imitate the business model archetype. In accordance with these different business model choices, the actors express different logics behind their new to the product market space business model choice. These logics represent different understandings of technology potential, customer needs as well as potential for value capture and contribute to and limit the translation of emerging technologies into dominant designs in diverse ways. Originality/value The business model is conceived as a focusing device that can be used to identify market applications for emerging technologies. As new disruptive technologies often require a new to the product market space business model, literature has in recent years put a premium on business model innovation. However, the linkages between emergent technologies and the choice of a novel business model are under investigated especially in relation to how business model choice affects business performance in nascent market settings. This paper aims at filling this gap.

Innovation for sustainable development in the food industry: Retro and forward‐looking innovation approaches to improve quality and healthiness

AbstractSustainable development in the food industry requires companies to be more innovative with their products and supply chain as a strategy for developing healthier and higher quality food products, and achieving better economic, environmental, and social performance. A clear path to follow when companies decide to develop innovations for sustainability is still lacking, especially with a focus on quality and healthiness. This study analyzes six case studies in the food industry in Italy, identifying two innovative approaches towards sustainable development for quality and healthiness, namely, forward‐looking innovation and retro‐innovation. The first one represents a typical business model redesign oriented to sustainability, that is, developing new products and reconfiguring the supply chain processes for entering new market segments, applied mainly in smaller companies. The second one, indeed, implies a supply chain restructuring strategy while going back to traditional agricultural processes, especially applied in companies with standard or certified products. Both approaches target sustainability performances and allow an improvement of food quality and healthiness.

Connecting business with the agricultural landscape: business strategies for sustainable rural development

AbstractAgribusiness enterprises link rural landscapes to global and regional markets. The nature of these business–landscape relationships is vital to the sustainability transition. Decisions by farmers and agriculture policymakers aggregate to changes in the ecology of landscapes, but the influence of food supply system businesses on rural landscape sustainability also requires scrutiny. This article uses four international cases to present a conceptual framework for investigating how different business strategies can support agricultural landscape sustainability. Insights from North America, New Zealand, The Netherlands, and Denmark inform the framework dimensions of horizontal/territorial and vertical/systemic business–landscape relationships. Three types of business model that promote rural sustainability are highlighted: provenance, cogovernance, and placemaking. These models engage strategies such as environmental management systems, certification, ecosystem and landscape services, and spatial planning. Research directions that will improve understanding about how business can engage with rural stakeholders for more sustainable rural landscapes are identified, including the need for cross disciplinary perspectives incorporating social, ecological, and business knowledge.

Does Ownership Determine Business Model?

The development of a new energy vehicle industry is considered a sustainable approach to solving the global energy crisis and the problem of environmental pollution. The sales of new energy vehicles in China are the highest in the world, and China’s new energy vehicle enterprises have played an important role in this. The business model, as a method for enterprises to achieve their strategic goals, utilizes resource advantages to deliver value to consumers, and is affected by enterprises’ ownership, competitive strategy, and resources. Based on the resource-based view (RBV) theory, the article uses a mixed quantitative and qualitative methodology, selects 30 vehicle enterprises from the mainstream market, and takes product value, suppliers, dealers and external relations, research capabilities, shareholders, and profitability as potential explanatory elements to analyze business model differentiation between different ownership categories. The article explores the reasons for the differences in business models between different ownership classes through case studies and data comparisons. It examines the characteristics and types of business model based on resources and competitive strategy. This study suggests that the ownership of enterprises plays a decisive role in strategic choices and resource acquisition and has a differential impact on the business model in resources and revenue dimensions. A business model represents the result of the interaction between competitive strategy and historical resources, which in turn demonstrates that ownership determines business model.

Game-theory-based analysis of Energy Performance Contracting for building retrofits

Energy Performance Contracting, a type of contractual arrangements between clients and Energy Service Companies, is nowadays a key vehicle to implement energy efficiency measures in existing buildings. As well-designed contracts contribute to establishing partnerships between clients and Energy Service Companies and to promoting the Energy Performance Contracting's further development, this work was aimed to figure out the optimal solutions of the contract terms under two typical business models (the Shared Savings Model and the Guaranteed Savings Model). Based on game-theoretical methods, the non-cooperative scenario was considered at first because both the client and the Energy Service Companies are self-profit-oriented. However, the non-cooperative contracts are not so efficient as they cannot bring the maximal project profit. Thus, the cooperative game models where the maximal project profits were allocated between the contract parties were set up. The differences between the non-cooperative and the cooperative scenarios and the impacts of the parameters in the models were also discussed. The frameworks presented possible solutions for the contract-design problem under the Energy Performance Contracting and instructed the contract parties to conclude the most proper contracts.

Geographies of relational coordination in venture capital firms

ABSTRACTVenture capital (VC) firms are crucial actors in entrepreneurial ecosystems. Through the development towards a digital economy, they have gained further relevance, which caused the VC industry to diversify in terms of business models. This article offers a new heuristic to study the VC industry by developing a classification of VC firms. By drawing on a framework of different dimensions of relational distance in investment relations, different types of relational coordination are identified by comparing VC firms in Germany. The types of VC business models are found to produce relational geographies of investing as they relate with their portfolio startups in different ways. A relational perspective on VC thus provides the opportunity to step beyond pure territorial approaches on VC.

We Can Do It? How the Tax Cuts and Jobs Act Perpetuates Implicit Gender Bias in the Code

In December of 2017 Congress passed sweeping tax “reform” legislation known as the Tax Cuts and Jobs Act. This article highlights three aspects of the legislation that reflect implicit bias in the Code and facilitate the marginalization of women as a result of tax policy that fails to consider underlying demographic data with respect to the equitable distribution of tax expenditures. Specifically, this article analyzes the elimination of the alimony inclusion/deduction regime under §§ 71 and 215 of the Code, the disallowance of a deduction for legal fees associated with the settlement of sexual harassment and abuse claims that include nondisclosure agreements under § 162(q), and specific provisions designed to promote small businesses that exclude the vast majority of businesses owned by women. This article proposes that real tax reform should endeavor to eliminate implicit bias in the Code by addressing the circumstances giving rise to the need for alimony in the first place; the barriers to success faced by women in the market, including discrimination, sexual harassment, and sexual assault; and the circumstances that propel female entrepreneurs toward the types of business models that are excluded from substantial benefits under the Code. In order to effectuate the equitable distribution of tax expenditures and facilitate economic efficiency through tax policy, real tax reform should reevaluate the normative view of marriage, families, and traditional business models reflected in the Code taking into consideration underlying demographic data with respect to the effects of tax legislation on discrete groups of people. Further, real tax reform would adopt a more holistic approach that takes into consideration the interconnected nature of the private and public lives of women struggling to participate equitably in the market and achieve financial independence and economic self-sufficiency.

Evolution of the Business Models of Russian Construction Companies Digitalization of the Industry

Development of the first business models of companies and the sectoral business system of the construction sector in Russia began 10 years after the country’s transition to market economy and was of evolutionary nature. The purpose of the study is to identify the relations between business models of large construction companies and their ability to adopt and apply digital technologies and non-technological innovations. Today, only the largest construction and development companies are capable of purposefully shaping and developing their business models. The share of such companies in Russia is less than 1 %, but their role in the development of the industry is large. Most companies are listed in national and regional ratings, which opens access to the information about their history and development, geography of presence, strategies, experience in overcoming crises, etc. The head offices of these companies are mainly located in Moscow and St. Petersburg, and sometimes in million-plus cities. Research methodology included compilation of a non-representative sample of 50 construction and development companies, identification of four types of business models and analysis of the models on the basis of the collected information. In the construction industry of Russia, business models of large companies evolve from incomplete to complete construction cycle, then to complete development cycle with and without the building contractor function. A significant share of development companies retains the building contractor functions, and it is a distinctive feature of their activity in Russia associated with the high uncertainty of economy. Complete cycle developers show great interest in digital technologies and organizational innovations, but their inclination to digital technologies reduces interest in non-technological innovations and vice versa. The business model of the complete construction cycle gives the companies a weaker impetus for innovation

Bank stability in South Africa: what matters?

The study examined the determinants of bank stability within the South African banking sector. By controlling for individual bank characteristics and market characteristics, the study determined possible determinants of solvency, a proxy for bank stability, measured by z-score within the South African financial sector. The South African financial sector is highly concentrated but with a significantly large number of banks, the greater portion being foreign owned banks. The business models of some of the financial intermediaries differ from the big four and therefore the influence of the type of business model is of great interest in this study, as it highlights a unique feature of the South African financial sector. The study’s investigation used panel data estimation techniques and found that among the specific bank characteristics, lending activity and capitalization do significantly affect solvency of banks and at sector level concentration was significant. The crisis dummy also revealed that the presence of a financial crisis heightened insolvency. The results have implications for financial institutions and therefore are of interest to regulators, bank management and researchers. Policy prescription in the form of Prompt Corrective Action framework is made to ensure proactive reaction to trends likely to cause instability.

How blockchain technologies impact your business model

Much of the attention surrounding blockchain today is focused on financial services, with very little discussion about nonfinancial services firms and how blockchain technology may affect organizations, their business models, and how they create and deliver value. In addition, some confusion remains between the blockchain (with definite article) and blockchain (no article), distributed ledger technologies, and their applications. Our article offers a primer on blockchain technology aimed at general managers and executives. The key contributions of this article lie in providing an explanation of blockchain, including how a blockchain transaction works and a clarification of terms, and outlining different types of blockchain technologies. We also discuss how different types of blockchain impact business models. Building on the well-established business model framework by Osterwalder and Pigneur, we outline the effect that blockchain technologies can have on each element of the business model, along with illustrations from firms developing blockchain technology.

ФРАНЧАЙЗИНГ ЯК ФОРМА РОЗВИТКУ ПІДПРИЄМНИЦТВА СОЦІАЛЬНО ВРАЗЛИВИХ ВЕРСТВ НАСЕЛЕННЯ

The paper argues that franchising is a specific form of doing business that applies to all developed market-economy countries. However, the scope of franchise practice in the Ukrainian economy, in particular in the area of doing business and entrepreneurship among socially vulnerable groups, remains rather limited. The research hypothesis is to assess the attractiveness of franchising for socially vulnerable populations. The implementation of this type of entrepreneurship by socially vulnerable groups allows to gain significant benefits for all the participants of franchising relationships: for start-uppers this is a good opportunity for effective self-employment, since they obtain a stable profitable business; for reputed firms and companies – to expand and strengthen their market positions; for the state – to acquire an effective tool to support entrepreneurship. The purpose of this study is to provide rationale for selecting the most appropriate franchise business model for socially vulnerable populations and to evaluate its implementation specifics. To summarize the research findings, the following methods were used: the taxonomy method – to analyze the key stages of business models evolution and classification; cluster and factor analysis – to expound the basic elements and tools of a franchise business model; the methodology for modeling of future by constructing scenarios – to predict possible socio-cultural and existential franchise-based entrepreneurship risks. The paper also seeks to explore characteristics of franchise entrepreneurship; its significance and role in the socioeconomic framework; the sources and motifs behind social entrepreneurship; the specific patterns of building business models for socially vulnerable groups along with justifying the particular indicators and criteria to develop a franchise business model typology and to reveal the institutional aspects in the formation of different types of franchise-based business models. The above study on the conceptual paradigm of social entrepreneurship has allowed to expand the theoretical understanding of social business entities functioning and development and to identify the peculiarities in the formation of different types of franchise business models. The application of the most optimal model will contribute to enhance the management efficiency of social businesses, which in turn will increase the cumulative social effects through the replication and dissemination of successful sustainable business models.