Learning Objectives Understand the difference between common business models Compare and contrast common business models when applied to a business Business Models A business models is the system that transforms intangible business ideas into productsservices that have value in the market place ID: 781594
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Slide1
Wyche Innovation Centre
Business Models & Introduction to Business Modelling
Slide2Learning Objectives
Understand the difference between common business models
Compare and contrast common business models when applied to a business
Slide3Business Models
A business models is the system that transforms intangible business ideas into products/services that have value in the market place (Hedman and Kalling, 2003)
Business models define:How a firm worksWho its customers areWhat the customer valuesHow a firm makes money
How value can be delivered to the customer cost effectively Magretta (2002)
Slide4Classifying Business Models
Business models provide a framework creating and delivering value to the end consumer. This can be done in the following ways:
Product/service providerOffers an end product or service to the customer
Ownership and rent of key assetsOffers customers the use of a product/serviceFinance providerOffers customers access to money and capital and associated services
Tidd & Bessant (2013)
Slide5Classifying Business Models
Systems integrator
Pulls together components on behalf of customersPlatform providerOffers a platform from which other businesses can create value
Network providerOffers access to a network Skills providerRents or sells access to knowledge or human resources
OutsourcerOffers to take responsibility for a non core/key activity for another business
Slide6Business Model Classification Discussion
Come up with an existing business which could be categorised under each of the business model categorises
What business benefits could be gained from categorising businesses based on their business model?Do you think it is a good idea for a single business to adopt several business models?How/why have you come to this conclusion?Is one business model more sustainable than other?
How/why have you come to this conclusion?
Slide7Case Study: Wyche Innovation Centre
In their own words:
Managed by Key IQAn innovation and technology hub in Worcestershire. They provide workspaces and business servicesFlexible to suit the needs of both small and growing businesses. Operating an easy in and easy out policy
Slide8Video
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Slide9Case Study Discussion Questions
What type of business model(s) would you classify the Wyche Innovation Centre of currently following?
How/why have you come to this conclusion?What are the benefits for the Wyche Innovation centre of having two different business models?Are there ever any potential dangers with operating more than one business model in a single business?
Slide10Mapping the Key Elements of a Business Model
Many tools exist to help with the mapping and visual representation of a business (including the Business Model Canvas)
When mapping the key elements of a business it is important to consider the following:What is the value proposition offered by the business?What are the key activities and resources required to realise the value proposition?
Who is the customer segment is?How will the firm will generate revenue money?
Slide11Mapping the Key Elements of a Business Model Activity
Answer the following questions for the case of the Wyche Innovation Centre in order to map out the key elements of their business plan
Pick a business and answer the following questions for that business in order to map out the key elements of their business plan
What is the value proposition offered by the business?What are the key activities and resources required to realise the value proposition?Who is the customer segment is?How will the firm will generate revenue money?
Slide12References
Hedman, J., Kalling, T. (2003) The Business Model Concept: Theoretical underpinnings and empirical illustrations,
European Journal of Information Systems, 12(1), 42-59Magretta, J. (2002) Why Business Models Matter?, Harvard Business Review, 80(5), 86-92.Tidd, J., Bessant, J. (2013) Managing Innovation: Integrating Technological, Market and Organizational Change
, John Wiley & Sons: Chichester.