Business Model Innovation And Design Strategic

Discuss about the Business Model Innovation and Design Strategic.

 

 

In the video, authors discussed the concept of strategy for organizations. In the video, author compares the strategy of organizations with the strategy at war front. Author argued that strategy is a very strong thing. It is important that organizations must have a high level strategy in place that could drive the tactics and objectives of various sub units in the organizations. It is also important that the strategy should be based on both internal and external environment of organizations. Sometimes without being aware of the laws or the regulations of the country in which their client is situated the vendor might be breaching the regulations of that country. For example, in the banking sector, it is regulated that banks are not allowed to send the customer data outside the country or share it with any third party. They are not allowed to save the data on the servers as well.  So these issues are very important in order to save the companies from court cases and giving penalties. Customers might or might not know about usage of their data by third parties. Sometimes there are two versions of data (França & Broman, 2017). One would be the primary one which is stored inside the country but the other one is stored somewhere else maybe outside the country for the Disaster recovery or to protect in case of any emergency like floods, Hurricanes etc. The best way to deal with this situation is to tell the vendor about all the legal requirements of the company before finalizing the contract. It is also important to clear all the terms and condition upfront so as to keep the accountability in place in case of any breach or legal issues.

A perfect example of organization operating in global environment is Apple Inc. Apple Inc. comes to mind as an example of an organization that is less open in some ways than others.  The company is notorious for wanting to control every aspect of its production process to ensure its hardware and software are tightly integrated and its intellectual property is protected.  Still, the company relies on outside organizations to manufacture its computers, cell phones, microprocessors, etc.  And it clearly discharges its product back into the environment. It is suggested that Apple must have a high level strategy in place for all of its business units. Apple has various subsidiaries in the world and it is critical that all these subsidiaries should work under the high level strategies of Apple Inc. It is also recommended that Apple Inc. should have a system in place where it can continuously monitor its strategic development and strategic implementation at the organization level (Baranenko & Dudin, 2014).

Business Model Innovation

The video is a very interesting video that explains the use of innovation as part of business model. The video emphasises on the important connection of innovation with the business model. In this era of globalization, the organizations have expanded and they have realized that that innovation could be a source of competitive advantage. The role of innovation is to organize and develop an agile culture where leaders can focus on inclusive growth and development. The connection of innovation and business model should also include the discussion around conscious capitalism (Rainey, 2015). The ethics of conscious capitalism impact management and leadership at every decision because your focus becomes placing others before yourself. Conscious capitalism seems very parallel to how a team functions when they are on a mission trip in a foreign country. They value each other, they share the common purpose of providing care to others, they work together to overcome obstacles, and they always seem to have a greater impact that they ever imagined. It would be correct to say that business models of organization could be dynamic in nature. The business model that works today may not the preferred choice in future. Therefore, it is critical that the organizations must have an open system of innovation where they can continuously focus on innovation across their lines of business.

Lets apply the business model and innovation on Dell Inc. The companies like Dell Inc. is benefited a lot with globalization. Dell, a premier Fortune 500 electronics services company, began over thirty years ago with an innovative 19 year-old’s dream and $1,000.00 dollars. The company grew expediential becoming a Fortune 500 company in 1992.  As any other organization, Dell progressed through the various life stage cycles of organizational growth and decline.  Presently, Dell finds itself at the fourth stage of the organizational life cycle.  In the fourth stage of the organizational life cycle, or the elaboration stage, companies have reached full maturation.  However, at stage four stagnation can occur and to avoid decline, or even the death of the organization, revitalization is required.  Companies experiencing stagnation between designs and environmental structures must realign internal processes to revitalize the competitiveness of the organization.  Such is the case with Dell, Dell most likely reached stage four in the late 1990s after becoming a Fortune 500 company and generating $1 million in sales per day.  However, in the early 2000s, Dell’s focus became maintaining market share and emphasis on innovation was lost.  Dell began to experience decline.  Dell, which had been made public, was repurchased by Michael Dell and Silver Lake Partners and focus returned to innovation and new product lines.  Dell’s decision to return to its entrepreneurial roots is no mistake, it was necessary to realign the company with its markets and prevent further decline. Today, Dell has a strong presence in developing countries and this has been possible only with the focus on globalization.

References

Baranenko, S.P., Dudin, M.N., Lyasnikov, N.V. and Busygin, K.D., 2014. Use of environmental approach to innovation-oriented development of industrial enterprises.

França, C.L., Broman, G., Robèrt, K.H., Basile, G. and Trygg, L., 2017. An approach to business model innovation and design for strategic sustainable development. Journal of Cleaner Production, 140, pp.155-166.

Gallen. (2013). Business Model Innovation. YouTube. Retrieved 26 April 2017, from https://www.youtube.com/watch?v=B4ZSGQW0UMI

Kryscynski, D. (2015). What is Strategy?. YouTube. Retrieved 26 April 2017, from https://www.youtube.com/watch?v=TD7WSLeQtVw

Rainey, D.L., 2015. A Holistic Model for Linking Sustainability, Sustainable Development, and Strategic Innovation in the Context of Globalization. In Handbook of Research on Sustainable Development and Economics (pp. 222-247). IGI Global.