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Clarifying Business Models: Origins, Present, and Future of the Concept

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This paper aims to clarifyi the concept of business models, its usages, and its roles in the Information Systems domain. A review of the literature shows a broad diversity of understandings, usages, and places in the firm. The paper identifies the terminology or ontology used to describe a business model, and compares this terminology with previous work. Then the general usages, roles and potential of the concept are outlined. Finally, the connection between the business model concept and Information Systems is described in the form of eight propositions to be analyzed in future work.
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... Business model (hereinafter BM) has been defined with several perspectives among researchers (Cfr. Bucherer et al., 2012;Teece, 2010;Chesbrough and Rosenbloom, 2002;Osterwalder et al., 2005;Magretta, 2002;Zott and Amit, 2008;Amit and Zott, 2001). Although there is still no consensus on a shared conceptualisation of it, the study takes the Osterwalder et al. (2005, p. 17) as the most consistent with the research aim: "A business model is a conceptual tool that contains a set of elements and their relationships and allows expressing the business logic of a specific firm. ...
... LUMSA University, 23-24 June 2022 Therefore, the study proposed a conceptual model to understand the potential role of external actors in the three different macro temporal frames of BMI (See Figure 1 and Table 4). The following The study suggests that university and technology providers support SMEs in developing their value proposition (Osterwalder et al., 2005, Osterwalder andPigneur, 2010). Marketing agencies have a stronger role in developing SMEs marketing channels and defining customers segments (Osterwalder et al., 2005, Osterwalder andPigneur, 2010). ...
... The following The study suggests that university and technology providers support SMEs in developing their value proposition (Osterwalder et al., 2005, Osterwalder andPigneur, 2010). Marketing agencies have a stronger role in developing SMEs marketing channels and defining customers segments (Osterwalder et al., 2005, Osterwalder andPigneur, 2010). Business consultants, instead, seems to be engaged in supporting firms in the whole business model innovation process, both in defining the new value proposition and designing new marketing strategies in terms of marketing channels and customer segments; however, they focus in design new value capture mechanisms consistent with the new value proposition and creation (Osterwalder et al., 2005, Osterwalder andPigneur, 2010). ...
Conference Paper
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Business model innovation has been extensively studied in startups and large corporations. However, extant literature lacks studies on business model innovation in SMEs. The study's objective is to shed light on SMEs business model innovation processes when adopting digital technologies. The manuscript focuses on the role of external actors in supporting SMEs unfolding business model innovation processes. It develops a qualitative explorative study collecting data from six cases. The cases are mainly Italian SMEs located in Marche Region. Data are analysed according to an abductive approach. The paper unfolds new perspectives on SMEs business model innovation processes while these are adopting digital technologies by shedding light on the role of external partners throughout the process. It identifies the actors who participate in the SMEs innovation. Also, it develops preliminary theoretical and managerial implications related to the role of the actors identified in supporting business model innovation processes linked to digital technologies adoption.
... Other researchers believe that even though both concepts are related, they represent different levels of information, useful for different purposes (Shafer et al., 2005). In their studies, Al-Debei and Avison (2010), Cavalcante et al. (2011), Morris et al. (2005), and Osterwalder et al. (2005) looked at the BM as an intermediate layer between the business strategy and the business processes, as illustrated in Figure 2.1. ...
... Some scholars define BMI as the discovery of a fundamentally different business model (Markides, 2006;Berglund & Sandström, 2013) and search for a new logic of the firm (Casadesus-Masanell and Zhu, 2013), while the others describe it as a replacing of the current business model (Mitchell and Coles, 2004), a reconfiguration of activities (Santos et al., 2009), and switching to a new business model (Sosna et al., 2010). Several researchers define business model innovation as the result of rearranging business model core components (Osterwalder et al., 2005;Bucherer et al., 2012;Frankenberger et al., 2013), but it is unclear which components of a business model need to be changed (Souto, 2015). Lindgardt et al. (2009) focus on value delivery and define a business model innovation as changes in two or more business model components that lead to novel ways of value delivery. ...
... Moreover, our research on the reasons why BMIs fail to deliver expected outcomes emphasised the importance of the implementation phase of BMI (Yannopoulos, 2013). One company can achieve its strategic goals by having a sound business model design together with a consequential implementation (Osterwalder et al., 2005). Although there are some commonly used models and frameworks such as Canvas (Osterwalder et al., 2005), Stof (Harry Bouwman et al., 2008), Csoft (Heikkilä et al., 2010), Visor (El-Sawy & Pereira, 2013) for researchers and practitioners in the areas of business model design and evaluation, there is no dominant framework for BMI implementation or model that provides clear steps to explain how BMI need to be implemented in practice (Rumble & Mangematin, 2015). ...
Thesis
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Firms need to be innovative and adaptive in competitive business environments subject to technological advancement and rapid changes in regulations and customers’ preferences. To do so, companies traditionally innovate their products or services, processes, marketing or organization. Since the advent of the Internet, business model innovation (BMI) has emerged as a new conceptual focus and a critical point to innovation. Compared to other traditional innovations, BMI is associated with high risk and uncertainty since it involves fundamental changes to the core components and/or the architecture of a firm’s business model (BM). Therefore, if not handled properly, a well-formulated BM may fail to improve performance. Therefore, knowing how and when to innovate a BM is a severe challenge for managers/owners of firms. Although most studies that combine strategic and innovation management with BMs mainly focus on large enterprises, the vast majority of firms worldwide (99%) are small and medium-sized enterprises (SMEs). To fill the gap, our research objective is: “To develop and test a conceptual model for implementation of Business Model Innovation in SMEs that focuses on “human and organizational” factors to improve performance. This research adopted a mixed-method approach consisted of five phases, e.g., two literature reviews, two quantitative studies (Survey, Structural equation modeling using SmartPLS 3) and one qualitative research (Case study, Cross-case analysis using Atlasti.9) to fulfil the research objective. Our research comprehensive conceptual model helps researchers understand the causal mechanism under which BMI influences the overall firm performance and serves as the grounding for empirical research in different types of companies, e.g., start-ups, SMEs, and large enterprises. On a practical level, our results give SME owners and managers insight into potential contingency factors on expected performance effects of business model innovation. Overall, this research analyzes BMI from different angles and develops a model to maximize business model innovation’s impact on a firm’s performance, especially from human and organizational perspectives. While the business world is constantly changing in terms of technology, regulations, and customer needs, these results advance BMI research by opening the black box of the causal relationship between BMI and a firm’s overall performance to better understand the BMI phenomenon.
... The terminology of BMs arose with the advent of the Internet in the mid-1990s and has been an intensively investigated field of research since then (Zott et al., 2011). Fundamentally, a BM aims to explicate a firm's core business logic by describing how an organization creates, delivers, and captures value while generating revenue (Osterwalder et al., 2005). A BM bridges the gap between the higher-order business strategy and the operational business concept (Al-Debei et al., 2008). ...
... Taxonomies are useful artifacts to structure a domain of interest and are vital to BM research (Glass & Vessey, 1995;Lambert, 2015;Osterwalder et al., 2005). They are used to cluster objects into specific groups based on similarities of characteristic properties (Bailey, 1994). ...
... The Customer Interface (D6) refers to the type of interface to access the product or service, such as browser-based solutions or on-premise software (Möller et al., 2019). The dimension Communication Channel (D7) describes the organization's various means to get in touch with its users and interact with the community (Osterwalder et al., 2005). ...
Article
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The open-source paradigm offers a plethora of opportunities for innovative business models (BMs) as the underlying code-base of the technology is accessible and extendable by external developers. However, finding the proper configuration of open-source business models (OSBMs) is challenging, as existing literature gives guidance through commonly used BMs but does not describe underlying design elements. The present study generates a taxonomy following an iterative development process based on established guidelines by analyzing 120 OSBMs to complement the taxonomy's conceptually-grounded design elements. Then, a cluster-based approach is used to develop archetypes derived from dominant features. The results show that OSBMs can be classified into seven archetypical patterns: open-source platform BM, funding-based BM, infrastructure BM, Open Innovation BM, Open Core BM, proprietary-like BM, and traditional open-source software (OSS) BM. The results can act as a starting point for further investigation regarding the use of the open-source paradigm in the era of digital entrepreneurship. Practitioners can find guidance in designing OSBMs.
... It is common to analyze the business model from the perspective of constituent elements and their relationship, which is also recognized by most researchers. Osterwalder et al. [13] proposed that enterprises can carry out business model innovation by changing the constituent elements in the business model system. Lindgadt et al. [14] proposed that there are two top-level elements of business model, namely, value proposition and operation mode, and believed that enterprises can choose one or several sub-elements to carry out innovation activities. ...
Article
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As the most important strategic resource of enterprises, big data has become the basic background of business model innovation. From the perspective of psychological contract, this paper discusses the mechanism of psychological contract in customer value proposition driven business model innovation and puts forward four research hypotheses. This paper adopts the confirmatory factor analysis method of structural equation to verify these four hypotheses. It is concluded that there is a significant positive relationship between customer value proposition and psychological contract; there is a significant positive correlation between psychological contract and business model innovation; and psychological contract has intermediary effect between value proposition and business model innovation. Furthermore, value proposition has a significant positive correlation with business model innovation, which has not been verified.
... La sostenibilidad de una organización depende en gran medida de la orientación a la mar-ca de la organización, que a su vez está relacionada con la consecución de una estructura y capacidades adecuadas para ejecutar sus decisiones estratégicas de forma que tenga influencia en la felicidad corporativa. Este proceso de sostenibilidad organizativa implica una adaptación y un cambio continuo en relación con la estrategia y el modelo de negocio de la empresa (Osterwalder, 2005). Además, los modelos requieren la creación de valor añadido para los clientes con el fin de obtener una ventaja competitiva (Chang et al., 2018). ...
Article
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Queremos modelos productivos sostenibles y ecoinnovadores en la era del siglo XXI? Un link a explorar orientación a la marca-happiness management 1 RESUMEN Actualmente, las entidades trabajan en mercados altamente competitivos y con continuos cambios económicos, sociales, medioambientales que hacen que los modelos de gestión deban estar alineados con los Objetivos de Desarrollo Sostenible (ODS). Concretamente, este trabajo se encuentra alineado con el ODS 12 "producción y consumo responsable". El objetivo principal de este trabajo es diseñar un modelo productivo enfocado a una orientación a la marca que apuesta por el desarrollo sostenible en cada una de sus dimensiones y en relación con el happiness management. Para ello, se ha desarrollado un estudio correlacional transversal con datos primarios mediante encuesta con una muestra de 216 directores de pymes de Andalucía en los sectores de la construcción, industria y servicios. El análisis se ha llevado a cabo mediante el diseño de un modelo de ecuaciones estructurales (SEM), que ha permitido analizar las principales dimensiones de la orientación de la marca, y, en consecuencia, estudiar su efecto en el happiness management de las pymes. Los resultados alcanzados ponen de manifiesto que la dimensión orientación a la marca influye directamente en la cultura empresarial del happiness management. Palabras clave: Orientación a la Marca, Happiness Management, sostenibilidad, Responsabilidad Social. ABSTRACT Nowadays, entities work in highly competitive markets and with continuous economic, social and environmental changes that make that management models must be aligned with the Sustainable Development Goals (SDGs). Specifically, this work is aligned with SDG 12 "responsible production and consumption". The main objective of this work is to design a production model focused on a brand orientation that is committed to sustainable development in each of its dimensions and in relation to happiness management. For this purpose, a cross-sectional correlational study has been developed with primary data through a survey with a sample of 216 managers of SMEs in Andalusia in the construction, industry and services sectors. The analysis was carried out through the design of a structural equation model (SEM), which allowed us to analyse the main dimensions of brand orientation and, consequently, to study its effect on the happiness management of companies. The results show that the brand orientation dimension directly influences the corporate culture of happiness management.
... A competitive model represents a business activity that is better than the existing options or may offer more value to a discrete group of customers or may even completely replace the old way of doing things and become the standard for other entrepreneurs. Business Model Canvas (BMC) is a template framework identifying and addressing the nine most important so called building blocks of a business solution and its environment: 8,9 • Value proposition is the bundle of benefits that a company offers to customers. It is the concept at the heart of the model, including the product or service itself (or the combination of these), and also value factors being the reasons behind the customer's motivation to buy it. ...
Article
Business models can be a perfect tool to meet the challenges in highlighting the competitiveness and sustainability potential of bio-based solutions, and facilitating primary producers to benefit from the opportunities offered by bioeconomy. In this work six concrete bio-based good practices that have succeeded in progressing from early ideas to a products on the market were analysed. These examples pose new insights that can be used by a wide range of experts and stakeholders for the analysis of benefits and challenges of value chains in the bio-based economy sectors. It is concluded that the traditional Business Model Canvas needs to be extended with additional factors related to sustainability and business ecosystem. In order to establish a practical framework promoting economic viability of bio-based business cases, the importance is highlighted for adjusting the exclusive focus on Technology Readiness Levels by introducing levels reflecting business or market readiness.
... The concept EA framework (Freitas et al., 2019) provides an extended list of attributes that relate technology integration to other business elements. Current approaches in the literature trigger the development of business models, but do not optimise a specific segment in the business model canvas (Osterwalder, 2004;Osterwalder et al., 2005;Osterwalder and Pigneur, 2010). ...
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This paper is dedicated to the core challenge of sustainably integrating new and viable business models into logistics systems in the context of the digital transformation. On the one hand, enterprises are facing increased competitive pressure and growth gaps in their own product portfolio; on the other hand, new technology and system solutions are finding their way into enterprises. These new solutions lead to significant changes in the cost structure as well as in the process design. Especially in increasingly digitalised and automated economic sectors such as logistics, production or processing industries, the adaptation and development of the own business model requires a systematic approach that presupposes the use and integration of proven methods. In the context of designing Smart Logistics Zones the interaction of logistical objects, processes, systems and the physical and digital infrastructure is achieved in a goal-oriented manner, depending on the requirements and the situation. An interactive design of the future of human-technology organization takes places. The procedure of the Smart Logistics Zone should support entrepreneurial decision processes purposefully and on the core idea of an Industry 4.0 in preliminary way. In addition to the integrative research concept, this paper focuses on the application of the methodological approach to a reference scenario of the Smart Logistics Zone and an exemplary business model.
... When business models describe company attributes on the reality level (like in Goddard, 2009 or Chesbrough, 2007), this question is meaningless because in this case business models are immediate. On the other hand, when business models are conceptual representations of the business reality (Massa et al., 2017;Osterwalder et al., 2005), accuracy requires a clear specification of the business reality to be represented. In this case, the status quo (with all its inherent characteristics) provides a reference point for the analysis and the interaction model helps to specify the meaning of accuracy with regard to business models. ...
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Purpose: The aim of this paper is to conceptualize the connection between business model and business reality. On this basis, the paper aims to put the business model on a solid conceptual basis and to build bridges to its neighbouring concepts. In this way, this paper should to contribute to more terminological and conceptual rigor of the business model construct. In addition, this paper aims to conceptualize the processes of constructing and using business models for decision-making. Design/Methodology/Approach: This is a conceptual paper; it introduces and specifies a new construct , the status quo, as real-world counterpart to the business model. Based on this, it develops a model of the interaction between business model and status quo. Findings: The key finding of this paper is that business model and status quo are shaped (and need to be described) by different characteristics. The characteristics of the status quo result from repetition (stability) and routinization (efficiency, low resistance, etc.). The characteristics of the business model result from observation, abstraction and simplification (purpose, observer perspective, etc.). Originality/Value: This is the first paper to develop the status quo as an independent construct for management research. It also offers the first comprehensive model of the relation between business model and business reality. Based on that, it allows establishing new connections between the business model concept and the theory of the firm, particularly with regard to innovation and routine.
Chapter
Academic libraries need to play a central role in providing user-centred services and enhancing users' quality of experience through digital innovation in the era of digital transformation. In the process of digital transformation, the businesses are transformed whereby new emerging approaches, best business practices, and new business models such as Business Model Canvas, are developed to support digital libraries innovations. Digital libraries are at the core of achieving higher education strategic priorities and critical pillars that include teaching and learning, research, and community engagement in an environment undergoing rapid digitalization. The Business Model Canvas thus offers digital libraries a lens through which to design innovative digital services to support the critical pillars of South African higher education institutions. This chapter explores the value of the Business Model Canvas in supporting creative digital services to internal patrons such as students, academics, researchers, and external patrons such as policymakers and industries.
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