Sustainable Business Development and Innovation System

Question: Discuss about the Sustainable Business Development and Innovation System. Answer: Introduction Business models can be said to be the representations made or created by organizations as a strategy to capture value in all of the economic, social and cultural contexts. According to (Teece, 2010), it can also be described as a companys worth supply to the customers and the transformation of payment to profits. It also explains how a firm conducts business, how it delivers value to stakeholders and how it links factor and product markets. It combines both the informal and formal aspects of the business and is a major part of any organizational business strategy (Baden-Fuller Haefliger, 2013). The business models have been used by many entrepreneurs in the classification of businesses and the exploration of opportunities available in the markets for future development strategies. When a business model is conceptualized, various factors are considered. According to (Teece, 2010), various factors considered in the business model follow a particular criterion for the logic in the design. The major factor they say is technology. The other factors include those that have the characteristics of Web 2.0 which are; user-generated content on the online platform, the network effects to be involved, the collective intelligence, and the kind of industry or the services provided by the business (Boons Ludeke-Freund, 2013). According to (Teece, 2010), the various elements that are found on a proper business model include; The technologies that are required in the embedding of both product and services together with the features involved. The benefit of the model in ensuring customer satisfaction through use or consumption of product/ services. The model should enable easy and quick identification of market demands and target groups. The available revenue streams should be compatible with the model of choice. The mechanisms and procedures to capture value should be enhanced at the last stage of the model before its implementation. According to (Zott Amit, 2010), various factors are considered when business models are conceptualized as systems and include; Activity system content which describes the activities to be taken during the incorporation of the model into the already existing system. Some of these activities may lead to employing new staff, training of the available staff or even development of new capabilities (Casadesus-Masanell Ricart, 2010). Activity system governance which describes the people whom will perform specific activities and involve role delegation in the model to be adopted. Activity system structure which lays out the strategies to be followed, how they sequence and also include their importance to the business model regarding their supporting or peripheral nature and their core. Types of business models According to (Hoflinger, 2014), various models can be adopted and used by organizations and include the following; Bricks and clicks model which incorporates online and online incidences in running their businesses. An example includes the OLX platform. The collective business model that involves various systems, organizations or professionals regarding resource collections and benefit provisions. Cutting out the middleman model which ensures that businesses deliver directly to customers and receive direct feedback without any intermediaries involved. This is the same as the direct sales models. The advantages of business models in solving problems Business models have given entrepreneurs and organizations a pathway to resolve some of the challenges they encounter in marketing, customer, environmental or the business context (Chesbrough, 2013). Some of the advantages according to a social media site, Get2Growth; include; It enables organizations to focus on the functions or activities that intertwine or interweave and are very much directed towards solving a particular problem (Get2Growth, 2017). It enables the organization to concentrate on the business, comprehend and identify areas of weaknesses or strengths depending on the efforts. The business model guides what is important hence remaining focused and on track towards achievement of desired goals. The speed to which these goals are achieved will also be guided by the models. All the employees, staff and stakeholders will be united by a shared vision and speak a common language towards growth and development (McGrath, 2010). Every member of the organization will focus towards value creation and scheme both to the customers and the organization itself. Business models and innovation According to (Zott Amit, 2010), business models are an excellent source of innovation among many organizations, and this is because they all desire to remain on the competitive edge. It enables the organizations to rethink the business around customer needs, available resources towards achieving these requirements, the processes to be followed in the gallant course and the plan to be used in the processes (Boons Ludeke-Freund, 2013). According to (Girotra Nettessine, 2014), these major frameworks enable innovation when derived from business models; The mix of services and products offered should guide towards innovation that creates value for the business hence reducing uncertainties. It enables the businesses to focus narrowly on the gap identified that exists in the market rather than selling common goods or services hence being outstanding (Baden-Fuller Haefliger, 2013). The model enables the creation of unique portfolios that are hedged hence reducing risks that may be encountered in the business process. These works for both product and marketing amalgamations. It enhances timely and proper decision making in a particular order, and appropriate choice of decision makers can be picked from the creativity seen from them together with their commitment (Casadesus-Masanell Ricart, 2010). Revenue stream, synchronizing of time horizons and the integration of incentives to staff can also enhance creativity and innovation when used properly in line with the model. The capacity of any given business model to succeed will depend altogether on the development of the business model itself, that is, its capacity to give socially helpful products, vocations or benefits and recoup the expenses at scale(Boons Ludeke-Freund, 2013). This will thus rely on upon various distinctive components: regardless of whether the model is advancing a pull product for instance, credit and cell phones and credit or a push product for instance, solar lantern and contraception; the amount of the encompassing biological community the business model must arrange and oversee, particularly in models that will include supply chains; and whether the main job will require market creation or market entry(Baden-Fuller Haefliger, 2013). An opportunity to scale the models will rely on upon a mix of every one of the three models and extra factors, for example, working out sales capacities and tenable distribution. Example of an organizations business model According to (Baden-Fuller and Haefliger, 2013) Business models are in a general sense connected with technological innovation, yet the business model built is basically separable from innovation. Various experts have characterized the business model as a framework that is presently being utilized to resolve the difficulties of recognizing who is (or are) the customer(s), monetizing the esteem, drawing in with their necessities, and conveying fulfillment. (Casadesus-Masanell and Ricart, 2010) both express that the structure portrays the business model framework as a model containing circumstances and end results connections, and it gives a premise to characterization. (Zott and Amit, 2010) have formulated the business model association with innovation in a two-manner way. To begin with, business models intervene the connection amongst innovation and firm execution. Secondly, building up the correct technology involves a business model decision with respect to openness and client enga gement. (Zott Amit, 2010), have enabled me to understand business models as systems. This they have done through properly articulating the interdependent activities that when properly implemented by an organization/firm, can allow it expand its boundaries and do better in the business. They also have mentioned that business models as systems enable partnering of different professionals, systems and business towards the achievement of one goal and value capture. They used both theoretical and empirical research results to come up with the designing procedure of a proper business model and how it can be used for innovation and value creation. Conclusion Various writers have confirmed that business models are very essential in ensuring that any serious firm is propelled towards prosperity, maintenance of competitive edge/market reputation and ensuring customer satisfaction. From the various studies conducted, the future of organizations will entirely depend on the type of business model adopted, and those that run without any may face a lot of market problems and other challenges associated with marketing, innovation and service delivery. References Baden-Fuller, C., Haefliger, S. (2013). Business models and technological innovation.Long range planning,46(6), 419-426. Boons, F., Ldeke-Freund, F. (2013). Business models for sustainable innovation: state-of-the-art and steps towards a research agenda.Journal of Cleaner Production,45, 9-19. Casadesus-Masanell, R., Ricart, J. E. (2010). From strategy to business models and onto tactics.Long range planning,43(2), 195-215. Chesbrough, H. (2013).Open business models: How to thrive in the new innovation landscape. Harvard Business Press. Get2Growth (2017). Advantages of the business model Canvas.Retrieved from www.get2growth.com Girotra, K. and Nettessine, S (2014).Decision Making; Four paths to Business Model Innovation. Hflinger, N. F. (2014). Business Model Design and Technological Innovation: Multi-Method Essays On Drivers, Working Mechanisms, and Consequences. McGrath, R. G. (2010). Business models: A discovery driven approach.Long range planning,43(2), 247-261. Teece, D. J. (2010).Business Models, Business Strategy and Innovation. Zott, C. and Amit, R. (2010) Business Model Design: AnActivity System Perspective.