Value creation mechanisms of business models

2018 ◽  
Vol 19 (3) ◽  
pp. 166-176 ◽  
Author(s):  
Vladyslav Biloshapka ◽  
Oleksiy Osiyevskyy
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Business Models ◽  
Business Value ◽  
Value Proposition ◽  
Value Appropriation ◽  
Value Capture ◽  
Fine Grained ◽  
Case Vignettes ◽  
Current Article

Management scholars and practitioners generally agree that the primary functions of a business model are value creation and value capture. However, the meaning (conceptualization) of these terms, their measurement, and the factors and mechanisms affecting them remain contentious. In the current article, we provide answers to these questions by clarifying the consumers’ value creation and business value capture constructs. Then, we demonstrate how they are determined by four business model mechanisms: value proposition and value targeting (affecting consumers’ value through willingness to pay) and value appropriation and value delivery (affecting business value through price and cost). We demonstrate that a fine-grained analysis of a business model’s value creation cannot be adequately performed without reference to these four mechanisms. The developed conceptual framework is illustrated and corroborated by the mini-case vignettes. We finish by outlining an application of the proposed framework to two crucial real-world business model situations: escaping the Giver Trap and remaining the Winner.

scholarly journals The impact of digital logistics start-ups on incumbent firms: a business model perspective

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jasmin Mikl ◽  
David M. Herold ◽  
Marek Ćwiklicki ◽  
Sebastian Kummer
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Business Models ◽  
Primary Data ◽  
Value Proposition ◽  
Value Capture ◽  
Content Type ◽  
Main Factors ◽  
Start Ups ◽  
The Impact

PurposeDigital freight forwarder (DFF) start-ups and their associated business models have gained increasing attention within both academia and industry. However, there is a lack of empirical research investigating the differences between DFFs and traditional freight forwarders (TFF) and the impact of digital start-ups on incumbents' companies. In response, this study aims to examine the key business model characteristics that determine DFFs and TFFs and propose a framework illustrating the extent to which digital logistics start-ups influence incumbent logistics companies.Design/methodology/approachBased on the primary data gathered from eight interviews with experts from start-ups' and incumbents' logistics companies, as well as secondary data, the authors identify the main factors of DFFs start-ups that have an impact on TFFs and analyze the similarities and differences in regard to the business model components' value proposition, value creation, value delivery and value capture.FindingsThe results show that differences between DFFs and TFFs appear in all four business models' components: value proposition, value creation, value delivery and value capture. In particular, the authors identify three main factors that need to be considered when assessing the impact of DFFs on TFFs: (1) the company size, (2) the market cultivation strategy and (3) the transport mode.Originality/valueThis is one of the first studies to specifically examine the key business model differences between DFFs and TFFs and to propose a conceptual framework for understanding the impact of digital logistics start-ups on incumbent companies.

scholarly journals The effect of business model innovation on organization performance

2021 ◽  
pp. 1481-1488 ◽  
Author(s):  
Amineh A. Khaddam ◽  
Hani J. Irtaimeh ◽  
Ahmad Rajaa Salameh Al-Batayneh ◽  
Suliman Raja Salameh Al-Batayneh
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Business Model Innovation ◽  
Arab Countries ◽  
Organization Performance ◽  
Company Performance ◽  
Value Proposition ◽  
Value Capture ◽  
The Impact ◽  
Measures Of Performance

The aim of the study is to investigate the impact of business model innovation (BMI) on firm performance. The sample of the study consisted of 120 managers from Alban Al-youm Company in Jordan, a leading dairy company. Data were collected using a questionnaire administered to managers. Eighty-seven questionnaires were retrieved valid for the purpose of data analysis. BMI was measured using three components: value creation, value proposition and value capture innovations while company performance was assessed via self-rated questions about operational measures of performance. The results accepted the hypotheses that all dimensions of BMI had significant effects on company performance. That being so, the study contributed to the literature on BMI on company performance in the absence of such studies that use samples for Arab countries, particularly, from Jordan in one of the most vital industries, which is a dairy industry.

scholarly journals Customer value creation via business model implementation

2015 ◽  
Vol 10 (10) ◽  
pp. 2580-2584
Author(s):  
Karaoulanis Andreas
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Customer Value ◽  
Business Models ◽  
Value Proposition ◽  
Model Concept ◽  
Customer Value Proposition

Business models are the blueprints upon which the whole structure and operation of the company is based. The aim of this paper is to underline the importance of business models in value creation for the company and to dig a bit deeper by revealing the synthesis of an abstract business model concept. The importance of customer value proposition via the customer value creation is very well underlined in order to pinpoint the author’s prevalent idea that focusing on customers’ needs should be the alpha and the omega for the eurythmic operation of every contemporary company.

scholarly journals The essential benefits of an enterprise blockchain in business model innovation

2021 ◽  
Vol 24 (2) ◽  
pp. 189-210
Author(s):  
Ambara Purusottama ◽  
Yohanes Berenika Kadarusman
Keyword(s):  
Organizational Performance ◽  
Business Model ◽  
Business Models ◽  
Business Model Innovation ◽  
Abductive Reasoning ◽  
Value Proposition ◽  
Value Capture ◽  
Blockchain Technology ◽  
A Value ◽  
Multiple Case

Blockchain brings changes and disruptions to the existing business models and therefore deserves further analysis. Accordingly, this study aims to explain the phenomenon of blockchain technology in the business model innovation in the enterprise ecosystem. Empirically, numerous studies have shown that blockchain technology improves organizational performance. This study uses a value system framework to explain the enterprise blockchain phenomenon. Through abductive reasoning, this study uses a multiple-case study to answer the research questions. In sum, this study finds that blockchain technology delivers benefits to organizations in: (i) value capture through increased profitability; (ii) value creation through private partnership; (iii) value delivery through smart contracts; and (iv) value proposition that encourages improving the existing value proposition through operational improvements. Besides, the study also proposes the different types of enterprise blockchain ecosystems: private and consortium. The private ecosystem focuses on improving organizational performance through competition. In contrast, the consortium ecosystem focuses on  business value collaboration.

scholarly journals Incorporating the Value Proposition for Society with Business Models of Health Tourism Enterprises

2019 ◽  
Vol 11 (23) ◽  
pp. 6711 ◽  
Author(s):  
Richard W. Butler ◽  
Adam R. Szromek
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Customer Value ◽  
Business Models ◽  
Relevant Literature ◽  
Research Literature ◽  
Value Proposition ◽  
Sustainable Business ◽  
Health Tourism ◽  
Tourism Enterprises

This article discusses the need to expand the concept of the value proposition, in order that this business model component includes the value for a customer, the value captured by the enterprise, and the value for the community, as well as benefits for the natural environment. The objective of the article is to identify sustainable development components that have been proposed for tourist enterprises in the research literature. The article proposes actions to complement existing tourist enterprises business models in order to give them the characteristics of a sustainable business model and to implement practices of value creation for the community. The research notes that the value captured by an enterprise determines the level of implementation of its economic objectives resulting from the value creation for the customer and implementation of social objectives (including pro-ecologic ones). The revenues of an enterprise depend, first of all, on meeting the expectations of the customer, meaning that they depend on the value proposition for the customer, and their volume will allow researchers to determine the possibility of creating value for the community. The expected tendency to create value for the community is argued to be proportional to the effectiveness of customer value influence, less the value captured by the enterprise. After an initial review of relevant literature, attention is focused on health tourism enterprises and how these principals can be applied in that context.

scholarly journals Business Model Archetypes

2021 ◽  
pp. 75-90
Author(s):  
Jan Jonker ◽  
Niels Faber
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Business Models ◽  
Early Stage ◽  
Building Blocks ◽  
Value Proposition ◽  
Community Based ◽  
Multiple Value ◽  
The Way

AbstractThe BMT provides the building blocks to develop a logic for a business model. In such a model the nature of value creation, how value creation is organized, and how transactions are taking shape are operationalized so that they meet the proposition. Practice shows that at present business models aimed at capturing multiple value creation can be divided into three major categories: (1) platform business models, (2) community-based (or collective) business models, and (3) circular business models. The three archetypes differ mainly in the way in which they create value, as well as the objective, the mechanism through which value creation takes place, and the infrastructural and technological requirements. When using the BMT, it is useful to consider at an early stage which business model archetype is dominant in the realization of the intended value proposition. Choosing a business model archetype might look straightforward, but it can be quite a tricky task.

scholarly journals Business Models’ Innovations to Overcome Hybridity-Related Tensions in Sustainable Entrepreneurship

2020 ◽  
Vol 12 (11) ◽  
pp. 4503
Author(s):  
Daniele Eckert Matzembacher ◽  
Mervi Raudsaar ◽  
Marcia Dutra de Barcellos ◽  
Tõnis Mets
Keyword(s):  
Value Creation ◽  
Business Strategy ◽  
Financial Stability ◽  
Business Models ◽  
Secondary Data ◽  
Value Proposition ◽  
Discussion Forums ◽  
Sustainable Entrepreneurship ◽  
Value Capture ◽  
Social Environmental

This paper aims to investigate how sustainable entrepreneurs innovate in business models to overcome their hybridity-related tensions to achieve environmental, social, and financial goals. A case study was conducted on 12 organizations in seven countries from October 2018 to June 2019 through observation visits, interviews, and secondary data collection. To analyze the data, a content analysis was applied with the help of NVivo Software. The analysis category is based on the definition of the pillars of business models: (1) Value proposition, (2) value creation/delivery, and (3) value capture. Concerning value proposition, organizations engage various stakeholders on developing emotions related to sustainable behaviors. They use the idea of community to promote it, fostering the sharing of intangible values. Associated with these actions, organizations offer more convenience accessing these products or services, home deliveries, facilitating access by geo-location, price reduction, and promoting consumers’ education. Regarding value creation/delivery, companies promote partnerships with other stakeholders as part of the main business strategy. They run the business while promoting a social movement. One is dependent on the other. In their engagement in sustainability discussion forums and practical activities, they put together consumers, suppliers, and also other agents outside their vertical supply chain. Operations of all companies are highly internet-based. Social media and transparency are also relevant to their operations. The main characteristic of value capture is that organizations integrate sustainability into their strategy in a way that, just by doing business, they fulfill their social, environmental, and economic missions. Therefore, through innovation in business models, these organizations overcome hybridity-related tensions and achieve financial stability while positively impacting society. The contribution to the literature was achieved by identifying business model innovations in sustainable entrepreneurship, analyzing their characteristics and mechanisms to overcome hybridity-related tensions, and providing empirical evidence about how business models can create and capture different and multiple forms of value.

scholarly journals Research on the Impact of High-End Ev Sales Business Model on Brand Competitiveness

2021 ◽  
Vol 13 (24) ◽  
pp. 14045
Author(s):  
Zhen Li ◽  
Fengbo Liang ◽  
Minjiao Cheng
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Business Models ◽  
Perceived Value ◽  
Mediation Effect ◽  
Manufacturing Cost ◽  
Value Proposition ◽  
Customer Perceived Value ◽  
Brand Competitiveness ◽  
The Impact

Electric vehicles have many advantages compared with traditional fuel vehicles, whereas the immaturity of technologies and high manufacturing cost make it difficult for EV brands to be promoted in traditional business models. Thus, auto-mobile companies started to establish high-end sales business model to promote the brand. This paper studies the influential mechanism of high-end EV sales business model on brand competitiveness and the mediation effect between high-end EV sales business model and brand competitiveness. A total of 624 consumers’ survey data were collected and the structural equation model (SEM) was analyzed to test the hypotheses by using a scale made up of indicators referring to high-end EV sales business model, brand competitiveness and customer perceived value. This paper contributes to the sustainable innovation literature by exploring the psychological perception of customer perceived value in strengthening brand competitiveness. The results show that both the value proposition and value creation of high-end EV sales business model have significant positive impacts on brand competitiveness. Moreover, customer perceived value fully mediates the relationships between the value proposition of high-end EV sales business model and brand competitiveness and between the value creation and brand competitiveness. Customer perceived value cannot mediate the relationship between the value capture of high-end EV sales business model and brand competitiveness. Our insights contribute to the business model research area from a customer-centric perspective.

Value creation analysis using atomic business models: The case of Digikala e-retailer – Part B

2020 ◽  
Vol 10 (2) ◽  
pp. 83-92
Author(s):  
Payam Hanafizadeh ◽  
Saeedeh Mehri ◽  
Hamid Hasanabadi
Keyword(s):  
Business Model ◽  
Value Creation ◽  
Business Models ◽  
Business Value ◽  
Electronic Business ◽  
Change Strategies ◽  
Retail Market ◽  
Customer Preferences ◽  
The Many ◽  
Market Changes

One of the reasons most startups fail, despite their growing number, is the inability and lack of flexibility of their business models in responding to market changes. In addition, due to the uncertainty of the startups’ environment, it is difficult to gain competitive advantage; startups need to continuously change their business models. One of the most common electronic business models is the electronic retailer. Despite the many challenges facing e-retailers due to market changes and customer preferences, Digikala has been ranked as the most popular and most visited website and has managed to gain over 85% of the Iranian retail market share. The purpose of this study is to analyze the value creation in Digikala in order to answer the following questions: Through which atomic business model can business value be realized? What change strategies should be applied to be able to provide a unique and stable value and be successful?

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