L2: Basic Business Structures

Question 1

A resource-based view

Answer 1

The resource-based view which argues that in order to succeed it is necessary to identify and develop resources and capabilities to create competitive advantages as part of the business model.

Question 2

The 3 dimensions of a business model (The 4 BM’s model)

Answer 2

A business model consists of three interrelated dimensions:
* Value chain constellation: Defines how the company is positioned in the market and seeks to create value
* Market power of innovators/owners of complementary assets: Where does the competitive advantage/market power stem from? (Innovation, assets etc.)
* Total revenue potential: How does the company make money

Question 3

Mention the 4 BM’s

Answer 3

Integrator, orchestrator, layer-player, market-maker

Question 4

Integrator (provide example)

Answer 4

-Traditional linear value chain where the company needs to be superior in each step of the value chain to succeed
-Full control
- Access to all relevant complementaries inhouse
- Often retailers

Example: Rema 100, Spotify

Question 5

Layer-player

Answer 5

• Specializes in one step in the value chain
• Over time they eventually expand the layer horizontally across several industries
• Requires deep tacit knowledge that cannot easily be transferred to another company
• Examples: Microsoft, Intel, pharma industry (focusing on R&D), marketing company, Novicell

Question 6

Orchestrator

Answer 6

• The company is co-coordinator of activities in a network of suppliers, still active in the complete industry value chain
• Orchestrators focus on one or a few cores steps of the value chain and outsource an co-ordinate the others
• Orchestrators get a higher flexibility but has to manage the relationship and the risk with partners
• Creating a new type of value chain and disrupting the existing value chain
• Examples: Nike, Adidas, Facebook

Question 7

Market-maker

Answer 7

• Creates transparency in the market by typically providing information to customers or producers
• Specializes in one step in the value chain
• Help customers navigate in the market of many opportunities
• Example: Momondo.com, Ebay

Question 8

Online Integrator BM’s

Answer 8

-Informediary (Trust Pilot)
-Subscription (Netflix)
-Community

Question 9

Online Layer-player BM’s

Answer 9

• Advertising (Google)
• Services (Dropbox, Zoom)

Question 10

Online market-maker BM’s

Answer 10

Brokerage (Laurtiz.com)

Question 11

Online orchestrator BM’s

Answer 11

Community (Youtube channel)

Question 12

Orchestration

Answer 12

“the set of deliberate, purposeful actions undertaken by a focal organization for initiating and managing innovation processes in order to exploit marketplace opportunities, enabling the focal organization and network members to create value

Question 13

3 types of orchestrators

Answer 13

Player, sponsor, facilitator

Question 14

Player orchestrator

Answer 14

• Strong ressource base
• competitive orientation (focus on own product development)
• Individual goals
• Short term profit

Question 15

Sponsor orchestrator

Answer 15

• Mix of individual and collective goals
• Focus on evolvement of members
• Long-term profit perspective
• Official brokering

Question 16

Facilitator orchestrator

Answer 16

• Collective goals
• Focus on network development
• Unofficial brokering
• Non-competitive orientation

Question 17

Determine the level of control of each orchestrator type

Answer 17

Player: High
Sponsor: Medium
Facilitator: Low

Question 18

The core activities of an orchestrator

Answer 18

Mobilization, setting agenda, innovating, network stability, knowledge mobility, coordinating

Question 19

Platform Businesses (Front page)

Question 20

What is a platform business?

Answer 20

Having two or more customer groups transacting through the use of your platform

Question 21

Two types of platforms

Answer 21

Business platform

Market platform

Question 22

Business platform (provide example)

Answer 22

A group of organizations that derives value from at least one platform business (Wolt, Uber, JustEat)

Question 22

Business platform (provide example)

Answer 22

A group of organizations that derives value from at least one platform business (Wolt, Uber, JustEat)

Question 23

Market platform (provide example)

Answer 23

Peer-to-peer (DBA, Ebay)

Question 24

Open innovation (Boudra & Lakhani)

Answer 24

Opening up the R&D process and using external communities

Question 25

Why use open innovation?

Answer 25

When consumer preferences are unknown or not well understood outside expert knowledge and experimentation can be beneficial. Also, new knowledge and competencies can be leveraged

Question 26

3 BM’s in relation to open innovation

Answer 26

Integrator
Product
Two-sided

Question 27

Explain integrator

Answer 27

Sells external innovation to consumers

External Innovators > Platform > Consumers

Question 28

Explain product

Answer 28

In which external innovators build “on top” of a foundation technology and then sell the resulting products to customers.

Platform > External Innovators > Consumers

Question 29

Explain two-sided

Answer 29

External innovators and customers are free to transact directly with one another as long as they also affiliate with the platform owner.

Question 30

What characterises the digital transformation in regards to BM’s

Answer 30

Linear to non-linear

Question 31

What is a platform powered eco-system?

Answer 31

A business comprising a mix of business models including platforms

Question 32

Ecosystem

Answer 32

A group of independent organisations collectively providing goods to their customers