Integrated Business Model by Oliver D. Doleski

Author:Oliver D. Doleski
Language: eng
Format: epub
Publisher: Springer Fachmedien Wiesbaden, Wiesbaden

Value

Market trends across all industries over recent years clearly show that products and services on the markets of the future will generally only be successful if based on sound, stable business models and also offer their users key value (cf. Bühner et al. 2012, p. 5). In other words, enterprises will, as a rule, only prosper with their business models if their products and customer solutions create value at market conditions. On the ever-competitive market, successful enterprises are those which continue to discover value-adding opportunities and to use these more effectively than their competitors, i.e. with greater value (cf. Rüegg-Stürm 2004, p. 69).

Considering the great significance of value creation to the economic survival of enterprises and their business models, the value element and the strategy element together represent the strategic dimension of iOcTen. Assigning value to the strategic level of the business model is hardly a surprising approach if we consider that customers are only interested in a product or service if they believe that it will offer them value. Value is also a key factor that distinguishes an enterprise from its competitors. Each and every business model should therefore include a description of the product or service that clearly details its value for the customer (cf. Zolnowski and Böhmann 2010, p. 32). That is why the value proposition has a central role in iOcTen, illustrated by the central position of the value element in the central octagon. Like the normative framework, value also influences the other elements in the core of the model.

For business models to create value, their products and services must be designed or developed to offer the best possible response to customers’ and business partners’ requirements. Far-reaching decisions must therefore be taken by the management on what specific needs and demands a business model is to fulfill. Management can draw on a range of value categories to make the right decision in any given situation. Osterwalder and Pigneur cite categories such as design, brand and status, price, cost reductions, risk minimization, availability and convenience/usability (cf. Osterwalder and Pigneur 2011, p. 28 f.). A number of other value aspects are also of relevance to the Integrated Business Model alongside the examples given here. These could perhaps be termed as ‘soft’ value aspects: aspects that are subjectively perceived by the recipients as more or less real benefits.

After responding in detail to the question of what specific needs and demands a business model is to cover, management has a firm, reliable idea of what products or services to market or continue to market, and in what configuration and customer segment, in order to create value.

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