15.2 Business models in historic perspective


    “A business model describes the rationale of how an organization creates, delivers and captures value.”
    Alex Osterwalder, Business Model Innovation

    In theory and practice, the term “business model” is used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, offerings, strategies, infrastructure, organizational structures, trading practices, and operational processes and policies.

    Obviously, business models are the core of the right to existence of an organization. Business models consist of elements like assumptions, facts, figures, vision, and creativity.

    Famous models of all ages.

    Although it is more like a growth strategy, the (aged) Ansoff Matrix in still very popular. This model is a tool that helps businesses decide their product and market growth strategy.

    The Five Force Model by Porter is a real classic. It is a framework for industry analysis and business strategy development. Porter’s Five Forces include three forces from “horizontal” competition: threat of substitute products, the threat of established rivals, and the threat of new entrants; and two forces from “vertical” competition: the bargaining power of suppliers, and the bargaining power of customers.

    Famous, and a bit more contemporary, is the Blue Ocean Strategy by Kim and Mauborgne. It is a strategy to create “blue oceans” of uncontested market space (no competition), ripe for growth.

    A blue ocean is created when a company achieves an innovation that creates value simultaneously for both the buyer and the company. The innovation (in product, service, or delivery) must raise and create value for the market, while simultaneously reducing or eliminating features or services that are less valued by the current or future market.

    Prahalad and Ramaswamy’s DART model contains the factors to achieve the ultimate co-creatiive success. Co-creation is vital to the shared value creation of the Organization 3.0 and its final goal: the transformation of all stakeholders.

    The most recent model is the “canvas,” a technique/model developed by Alex Osterwalder in his book, Businesss Model Generation. The model describes, through nine basic building blocks, the logic of how organizations make money.

    The nine blocks cover the four main areas of a business: customers, offerings, infrastructure, and financial viability. The model is a blueprint for a strategy to be implemented through organizational structures, processes, and systems.

    Using the canvass technique, and, with the help of Alex Osterwalder and his Dutch counterpart Patrick van der Pijl, we had our own canvass drawn: the Seats2meet.com network model, facilitating the stage for our stakeholders to achieve their own transformations…