Academic Paper 2

Question 1

What elements does a business model consist of?

Answer 1

• Customer Value Proposition(CVP).
• Profit Formula.
• Key Resources.
• Key Processes.

Question 2

What are the components of the Profit formula?

Answer 2

• Revenue Model.
• Cost Structure.
• Margin model.
• Resource velocity.

Question 3

What does Resource Velocity mean?

Answer 3

Determining the pace needed to operate the business, eg: Managing the inventory, determining the cash flow, etc.

Question 4

What is the road map in implementing a business model?

Answer 4

• Finding opportunities to satisfy a real customer job or need.
• Constructing a plan to fulfil the need by knowing the firm’s ability and also doing it by getting a profit.
• Comparing the new model to the existing model to see the differences.

Question 5

How great models are built? (according to the article)

Answer 5

• Creating a clear Customer Value Proposition addressing the need.
• Designing a profit formula (Considering all the elements).
• Identifying the key resources and processes.

Question 6

When a new business model is needed?/What are five strategic circumstances that often require business model change?

Answer 6

• The opportunity to address through disruptive innovation the needs of large groups of potential customers.
• The opportunity to capitalise on a brand-new technology by wrapping a new business model around it.
• The opportunity to bring a job-need-to-be-done focus where one does not yet exist.
• The need to fend off low-end disruptors.
• The need to respond to a shifting basis of competition.

Question 7

What is the important detail that needs to be known when implementing a new business model?

Answer 7

The business model needs to be new or game-changing to your industry or market or else it would be a waste of time and money.

Question 8

What are the elements that can help in implementing the business model?

Answer 8

• Breaking the rules. ( Getting out of the common routine that has been set in the market or the rules set in the firm)
• Identifying new competencies. (Identifying key elements that can have an impact on the business model)
• Patience. (The firm should expect initial hiccups and failure but enduring those and learning from them, will yield a successful business model.)

Question 9

What is the important attribute needed for the customer value proposition?

Answer 9

Precision, making the customer understand the problem and your solution signifies the standard of the CVP.

Question 10

What are the 3 steps that companies need in order to develop a new business model?

Answer 10

The first step is to realize that success starts by not thinking about business models at all. It starts with thinking about the opportunity to satisfy a real customer who needs a job done.

The second step is to construct a blueprint laying out how your company will fulfil that need at a profit. In our model, that plan has four elements.

The third is to compare that model to your existing model to see how much you’d have to change it to capture the opportunity. Once you do, you will know if you can use your existing model and organization or need to separate out a new unit to execute a new model.