The Essay On Adopting Disruptive Business Model And Smart-Connected-Products In Modern Business Environment.

Examples of Disruptive Business Models and Their Impacts

Discuss about the Business Model and Disruption Terms.

Chesbrough, (2010) has advocated that the in the present disruptive age, the established business models are under attack. It has been opined by (Gambardella & McGahan, 2010) that the business models in the recent times have become less durable that they used to be. The basic rules that were adopted by the business models to create and capture economic value were fixed in place for years as the business organizations emphasized on executing the same business models better than its competitors. However, in the recent times the business models are experiencing rapid displacements and disruptions and in extreme cases, they are facing outright destruction. This has been evident from some considerable examples of the business models like the Bitcoin emphasized on bypassing the traditional banks and clearinghouses with the blockchain technology, edX and Courseera threatened the business schools with their massive open online courses, Tencent has outcompeted in the Internet services through microtransactions and Uber sidestepped the license system that protects the taxi cabs franchises in the cities across the globe (Habtay, 2012).  

Thus, on the basis of the above examples, it can be said that a business organization that does not adopt a disruptive focus are following a me too platform i.e. they emphasize on doing the same things in the same ways for the same reason for a long time. They struggle with the concept of change So, adopting a disruptive business model make the business organizations capable of reengineering, optimizing and non-intermediating its products and services or the market or a sector of the industry.   Moreover, the business environment is experiencing rapid technological advancements and feeling the heat of globalization (Osterwalder & Pigneur, 2010). These two aspects are making the business of all sizes face the emerging need for adopting a disruptive business model. Another example that can be cited in the context of the failure of the traditional business model and the ways disruptive business model lead the business to success is through the example of Domino’s Pizza. Domino’s Pizza while conducting its business through the traditional business model experienced all time low in its share price and slipped down the ranking to occupy the last position in terms of consumer preferences in the 2009 survey (Mcorpcx, 2018). Realizing the failure of its business model, Domino’s Pizza integrated disruptive technological innovations to optimize all its business aspects. This helped the business in rebuilding its image in the minds of the customers’ tastes and preferences.

The Smart-Connected-Products facilitate the business organizations with expanding opportunities on one hand and on the other hand emphasizes on altering the industry structure and the nature of competition. It also proves to be beneficial for the business organizations with new functionality, enhanced reliability and higher product utilization and develop capabilities that help the business in cutting across and going beyond the traditional product boundaries (Christensen et al., 2009). So, business organizations like Domino’s Pizza are facilitated with new competitive opportunities and threats through the Smart-Connected-Products. Business organizations like Domino’s Pizza are facilitated with new strategic choices through Smart-Connected-Products. It assists the firm in creating value and facilitates new ways of managing the prodigious amount of new data and the ways in which the firm can maintain their traditional relationship with the business partners since Smart-Connected-Products helps in redefining the channels.

The Need for Disruptive Business Models in the Modern Business Environment

Thus, on the basis of the above aspects, it can be said that Smart-Connected-Producers facilitates the business organizations like Domino’s Pizza with significant opportunities in the form of competitive advantage through product differentiation, enhanced level of satisfaction on the part of the customers, operational efficiency, gaining enhanced knowledge of how customers actually use the products and achieving enhanced ability ion segmenting the market, setting effective prices for capturing value and offering enhanced offerings to the market segments (Porter & Heppelmann, 2015). In addition to the above opportunities, Smart-Connected-Products also pose significant level of threats to the business organizations like Domino’s Pizza. The smart-connected-products demands a complete business reengineering together with high investments, difficulty in maintaining relationship with the traditional business partners, demand highly skilled and experienced technical professionals and it also leads to confusion on the part of the business organizations to secure, capture, analyze and secure the collected data for achieving enhanced value of offerings.    

Business Model as Value Proposition

Value Propositions can be defined as the products and services that prove to be beneficial for the business organizations in creating value for a specific customer segment. The value proposition is created by solving the customer issue and satisfying their specific needs. The value propositions also involve the innovative technology in delivering the products and services (Zott & Amit, 2010). The value propositions in context to the business organizations are capable of satisfying the needs of the customers either because the need was not recognized or there were no similar offering and at time newness in technology also proves to be beneficial in enhancing the value proposition.

In this context, it can be said that Domino’s Pizza in order to offer value proposition to its customers emphasize on offering core products that include pizza, pasta, salads, deserts and more. These products prove to be beneficial in satisfying the needs of the customers (Al-Debei & Avison, 2010). Domino’s Pizza also emphasizes on offering added value services to its customers that include Domino’s wedding, School lunches and also has developed an app to facilitate its customers with the live status of their order through Smart Track my Pizza and Domino’s Tracker.

Domino’s Pizza emphasize on facilitating its customers with enhanced shopping experience. This is facilitated by providing an opportunity to the customers to place the order for their pizza through Tweet to order pizza, voice ordering, easy order button, order pizza in zero clicks, delivery robot, pizza oven delivery car, drone delivery, Xbox ordering and in car delivery options. This enhances the experience of the customers (Gambardella & McGahan, 2010).

Domino’s Pizza also emphasize on communications and touch points and in this context they have developed new pizza delivery boxes and offer rewards to its customers through third party partnership and providing real time customers reviews in their store.

The importance resources for Domino’s Pizza include the following:

Financial resources

Domino’s Pizza has been successful in its business endeavour that has increased its price to reach $160 in 2016 from a mere price of $6 per share in 2009 (Mcorpcx, 2018). Moreover, with its disruptive business model Domino’s has been successful in emerging as the second largest pizza company across the globe with a market capitalization of $10254.22 (Mcorpcx, 2018).

Physical resources

The brand has its presence across the globe and in Australia alone, the brand has 670 restaurants that enhances its customer reach (Dominos, 2018).

Technological resources

Domino’s has efficiently optimized all its business aspects and in recent times it is recognized more as a tech firm than a pizza firm. Technology has been implemented in ordering and delivery of orders like online ordering, ordering through tweet, order button, in car ordering, Xbox ordering and delivery pizza through drone and robots.

Organizational

Domino’s has adopted a multilevel organizational structure and a people culture to promote team working.

Human Resources

Domino’s Pizza in order to adopt disruptive business model has emphasized on hiring and recruiting tech savvy employees.

Organizational Capabilities

It is important for the business organizations become capable of making an optimum utilization of the available resources to gain competitive advantage. Domino’s Pizza in the recent times has overcome its past and its traditional business model to adopt a disruptive business model and has emerged as tech savvy company. This has been successful because of the ability on the part of the company leaders to efficiently utilize the available resources to design innovative ways of facilitating customers with unique products and services to meet their specific needs (Wirtz et al., 2016).

Conclusion

On the basis of the above analysis, it can be concluded that business organizations need to adapt to the change and embrace technological advancements to remain competitive and disruptive.

References

Al-Debei, M. M., & Avison, D. (2010). Developing a unified framework of the business model concept. European Journal of Information Systems, 19(3), 359-376.

Chesbrough, H. (2010). Business model innovation: opportunities and barriers. Long range planning, 43(2-3), 354-363.

Christensen, C. M., Grossman, J. H., & Hwang, J. (2009). The innovator's prescription. Soundview Executive Book Summaries.

Dominos. (2018). Business Partners - Domino's Pizza. [online] Available at: https://www.dominos.com.au/inside-dominos/corporate/business-partners [Accessed 21 Apr. 2018].

Gambardella, A., & McGahan, A. M. (2010). Business-model innovation: General purpose technologies and their implications for industry structure. Long range planning, 43(2-3), 262-271.

Habtay, S. R. (2012). A firm?level analysis on the relative difference between technology?driven and market?driven disruptive business model innovations. Creativity and Innovation Management, 21(3), 290-303.

Mcorpcx. (2018). Lessons from the Upper Crust: How Domino’s Pizza Disrupted the Delivery Game and Became a Leader in Customer Delight. [online] Available at: https://www.mcorpcx.com/articles/lessons-upper-crust-dominos-pizza-disrupted-delivery-game-became-leader-customer-delight [Accessed 21 Apr. 2018].

Osterwalder, A., & Pigneur, Y. (2010). Business model generation: a handbook for visionaries, game changers, and challengers. John Wiley & Sons.

Porter, M. E., & Heppelmann, J. E. (2015). How smart, connected products are transforming companies. Harvard Business Review, 93(10), 96-114.

Wirtz, B. W., Pistoia, A., Ullrich, S., & Göttel, V. (2016). Business models: Origin, development and future research perspectives. Long Range Planning, 49(1), 36-54.

Zott, C., & Amit, R. (2010). Business model design: an activity system perspective. Long range planning, 43(2-3), 216-226.

Zott, C., Amit, R., & Massa, L. (2011). The business model: recent developments and future research. Journal of management,