Business Models Matters (#2)

Is this Business-Models-for-Innovation ? Or innovative Business-Models ? Even innovation of (in) Business-Models ?

Rethinking Business Model for Innovation : Lessons from entrepreneurial cases is an e-book, edited by Valérie Chanal in late 2010. For teasing, copyrighting and coherent editing issues, the proposition is to release few focused excerpts. Here is the conclusive part of the chapter written by Olivier Lavoisy, Markus Eurich, Sigmund Akselsen and Pål Ytterstad.

& :
– To download the full book for free (shortcut : from HAL-SHS, France’s academic publication platform).
– The introduction of the chapter | Business model ? (webOL).

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Ecosystem modelling to imagine the future of business within R&D partnerships :
The SENSEI European consortium, building the “Future Internet”
| Conclusion

The Business Role Reference Model appears as a value chain (see box #2) with the “broker” in the pivotal role. From top to bottom where the users are to be found, each step adds new value from data to information to service. According to Gambardella (2010), this is the case for “general-purpose technologies ” for which innovative firms gain all the more by capturing value via the multiplication of applications. This is exactly what is aimed at using the concept of “horizontalisation” in the SENSEI project.

The full Business Model Framework is an up-to-date multi-staged process, which is relevant for other collective innovation projects, notably as no technological prerequisites are required:

– The first step involves selection and enhancement of scenarios. The selection of scenario is based on a set of criteria that are key to the SENSEI innovations. This provides a first level of formalization: the scenario portfolio along with the detailed characterization of roles. Even at this early stage the business perspective is already taken into account.

– The second step involves describing the different parts or scenes of each selected scenario. This is done to identify actors and roles, values and rewards. The various ecosystem descriptions are detailed for each particular scene to include the detail of the associated roles attributes and relationships.

– The final step of developing the business framework is to perform an analysis and synthesis of the different value systems. This is done by identifying patterns and commonalities within the system.

The outcome is a merged reference model, called the BRRM (Business Role Reference Model). This framework is quite an abstract tool, but linked to very operational agendas from a large panel of stakeholders. A project like SENSEI gathers representatives of small and big companies along with several R&D institutions. The involvement of industrial stakeholders is at the core of this kind of project. They were present at all stages of the process.

Knowing about the roles in the environment of the Future Internet (sometimes called the “Real World Internet”), a stakeholder could find constellation mapping a powerful tool to provide the first insights on the business aspects of their project by concentrating on the core components of a Business Model, namely: the business partners to interact with, the overall business network, the revenue generation mechanisms, the revenue flows, and the value propositions. This is why constellation mapping is also a key element:

– zooming-in on a business role, it provides clues for the Business Models of each organization,

– zooming-out it gives the overall picture, which is necessary to understand the ecosystem and to prepare for changes and rivalries.

As explained, the method proceeds by a double movement going from particular (detail) to general (global) and from general to particular. Initially, scenarios are required to assist in understanding, in the definition of scenarios and in the identification of key issues. Next, a more abstract phase of work is carried out in order to create a generic (global) model of the ecosystem which can be applied to different contexts. This model is developed with the aim of assisting the various economic actors in the project in the development of value propositions from the technology being analysed. For us, this approach and the abstract-model of the ecosystem have the advantage of favouring the collaboration between different economic actors (in some cases competitors) engaged in collaborative R & D and working on strategic issues. They can work on the project, move forward together and define the structure of the ecosystem without having to reveal (or compromise) their individual strategic intentions