Business Modeling and BOS - Article Example

Scientific Article Including Visual Visual Thinking From a theoretical understanding, the perception of visual thinking refers to an approach of viewing this modern world in a distinct way. It plays an imperative part in the creation of innovative ideas and most vitally revealing new concepts for reaching into a valid conclusion. It is also regarded as a pioneering learning style, which tends to facilitate an individual of acquiring detailed information about any specific subject matter of a study by linking with images. By considering the subject matter of business model generation, BOS acting as an efficient business model innovation facet has been discussed with the incorporation of visual thinking approach. Basically, BOS is regarded as an innovation based model or strategy, which appears at a certain scenario wherein their lays the need of restructuring a company’s culture as well as strategies. It is typically regarded as an essential attribute of business model innovation, which plays a decisive part in assisting the organizations that are operating under the present day context towards reaping several significant benefits (Tantau & Mateesescu, 2013). These benefits entail increasing the profitability level in terms of market share, ensuring long-term sustainability and attaining superior competitive position among others. It is evident that the modern business setting has become much competitive due to several crucial factors. These factors entail increased level of globalization, gaining momentum of internationalization and wider adoption along with execution of innovative technologies. It is in this context that the modern organizations often embrace BOS as an innovational strategy for addressing and mitigating such an adverse or unforeseen situation (Tantau & Mateesescu, 2013). An effective execution of BOS enables an organisation to deal with varied crucial issues that emerge during the conduct of different operational functions. In precise, it can be affirmed that the notion of BOS, acting as an innovative business model, facilitates an organisation to deal with the issues like intense business market competition and increasing level of price pressure. Apart from these, the other crucial aspects comprise gaining momentum of customers’ bargaining power and the inability to take effective decisions about maintaining long-term sustainability (Kim & Mauborgne, 2004). It is to be inferred that BOS, acting as an innovative business model, usually functions as a safety valve specifically for the modern companies, which in turn, enables such companies to secure their respective business market position and compete with their chief business market competitors. The various elements of BOS can be ascertained as capturing as well as generating new demand, intending towards creating an unconcealed sort of market space and making the prevailing business market competition irrelevant. These elements eventually make BOS to get differ from Red Ocean Strategy (Kim & Mauborgne, 2004). This can be better understood from the following portrayed visual representation. Figure: Blue Ocean Strategy Source: (Kim & Mauborgne, 2004) With regards to the above stated context, the BOS model can be better explained from the pictorial illustration depicted below. Figure: Value Innovation Source: (WSI, 2007) While explaining the subject concerning BOS, the viewpoints of Osterwalder & Pigneur (2013) could not be ignored. This can be justified with reference to the fact that the authors made deliberate efforts towards blending the business model innovation with that of BOS. The following graphical representations will provide a brief understanding about the above stated context. Figure: Business Model Canvass Source: (Osterwalder & Pigneur, 2013) From the above depicted pictorial illustrations, it can be recognized that the business model canvas (on the left) comprised two particular sides that entail value-side and cost-side. The varied elements of value-side generally comprise value proposition, customer relationship and channels among others. On the other hand, the constituents of cost-side typically encompass key resources as well as activities, partnerships and costs. Thus, according to Osterwalder & Pigneur (2013), if certain elements of value-side get added or eliminated, then this will have immediate implications on the constituents of cost-side. According to the ideas presented by Osterwalder & Pigneur (2013), BOS is all about raising the value by lessening costs, which can be better understood from the above depicted visual representation (on the middle). The costs can get reduced by evading any sort of less valuable service. On the other hand, as per the guidelines of BOS, the values can be raised by improvising the highly-valued facets of the services that do not have the potentiality to raise the cost base. With this concern, blending business model innovation with the BOS (on the right), may significantly assist in determining the functions of elimination, creation, addition and deduction while dealing with each element of value as well as cost-base. In relation to the above stated context, BOS, acting as one of the imperative business innovation models, eventual tends to promote innovation within a business by varied ways. In this similar context, such ways can be reckoned as methodically analyzing the prevalent business environment and also assessing the effectiveness of varied business models that are accessible for deriving positive benefits (Osterwalder & Pigneur, 2013). Based on the observation made by Osterwalder & Pigneur (2013), the conception of BOS intends to assess a specific industry for raising greater amount of value and minimizing costs simultaneously. There are certain methods as well as approaches based on which the notion of BOS operates its different functions with the intention of attaining the above stated objectives. In this regard, the BOS initially executes Strategy Canvas as one of the approaches for analyzing a specific industry and recognizing the prevalent action frameworks, if any. This particular approach or method i.e. Strategy Canvas typically gets involved into depicting the existing industry situations and reveals the factors based on which the industries are competing in global standards. With due consideration of this attribute of Strategy Canvas, the next task is to identify and apply the existing action frameworks for testing the business model and logical levels of the industries. In this regard, such action frameworks can be reckoned as rising the industry standards beyond the expectation level, generating new offerings, eradicating certain aspects that are no longer necessary and lessening the elements that remain underneath the industry standards. These action frameworks can be better understood from the following pictorial representation. Figure: Four Action Frameworks Source: (Osterwalder & Pigneur, 2013) In relation to the above stated context, the perception of BOS elaborated the fact that a start-up company operating in any industry needs to explore the probability of generating a blue ocean at the initial phase with the intention of deriving varied positive outcomes and most importabtly obtaining several significant benefits. These positive outcomes and benefits on behalf of start-up firms can be reckoned as increasing the profitability level in terms of market share, preserving long-term sustainability in the respective operating business markets and attaining superior competitive position as compared to others. Apart from the start-up businessess, it is worth mentoning that the existing businesses, which are operating for several years and competing for ensuring the maintennace of viable position in the respective industry can also adopt and execute BOS. This adoption of BOS for the already existing businesses can be for promoting innovation in their respective products and/or services that effectively segments the target markets towards the attainment of predetermined targets. According to the viewpoints of Osterwalder & Pigneur (2013), the notion of BOS tends to challenge as well as refocus the existing market conditions and norms for eradicating any sort of dispute that may arise during the conduct of varied operational functions. This particular activity of BOS eventually gets support from the above discussed four action frameworks that aid in making any change in the current business or operational procedure in this competitive business world (Osterwalder & Pigneur, 2013). Value innovation is deemed to be regarded as the other important concept associated with a business model, which has been clearly explained by BOS. It must be mentioned in this similar context that the important factor concerning value creation fundamentally depends upon two significant aspects including cost savings and buyer value. With this concern, it is to be affirmed that cost savings are generally made through the procedure of eradicating as well as lessening such factors based on which a specific industry competes with others for obtaining several significant benefits. On the other hand, buyer value denotes lifting the same in terms of generating along with raising such elements that a particular industry has never provided to others (Osterwalder & Pigneur, 2013). A pictorial representation has been provided below for better comprehension of the above stated context. Figure: Value Innovation Source: (Osterwalder & Pigneur, 2013) In precise, it can be affirmed that BOS gets interpreted as a blueprint about how a business firm is operating in a specific industry and performs varied functions for attaining its predetermined targets. It mainly derives certain few essential indicators or blocks based on which both startup and already existing businesses can attain their respective targets within a stipulated timeframe. These indicators or blocks can be apparently observed as segmenting the customers as well as the target markets in an appropriate way, shaping suitable value propositions as along channels and forming, developing as well as preserving customer interrelations. Apart from these, the other indicators or blocks include identifying the exact revenue streams based on which the desired targets can be fulfilled, effectively using the available resources, performing key activities within a set time and working upon developing the cost structures among others. It will be vital to mention that the above stated blocks eventually compose a suitable as well as an effectual business model canvas, which can be better understood from the portrayed pictorial design (Vacek, 2013). Figure: Business Model Canvass Source: (Vacek, 2013) With regards to the above stated context, it can be affirmed that the perception of BOS tends to generate unchallenged market spaces and make the prevailing business market competition irrelevant. The prime attributes of BOS can be related to the business model pertaining to innovation, as these intended to derive greater level of customer value, finding out the distinctions prevailing amid price along with utility and promoting innovation as per the desired level among others. It is worth mentioning that the cornerstone of BOS lay in deriving and substantiating the factor concerning value innovation for attaining significant benefits. These benefits from the perspective of a business mainly entail marking dominant position in the respective business markets or industries by adopting along with executing effective strategies and competing with the prevailing competitors in an efficient way and likewise ensure long-term sustainability. It must be mentioned in this similar concern that with the increased level of globalization, gaining momentum of internationalization and changing business market conditions along with customers’ preferences, the modern day organizations intend to use distinct business models associated with innovation for addressing the above stated situations. In this regard, BOS is duly considered to be one of such models, which have been using the modern firms to accomplish their respective predetermined targets (Vacek, 2013). There are certain special features for which the organizations operating in this present day context are largely embracing BOS for fulfilling their desired targets. In this similar context, such attributes can be reckoned as valuing the factor of innovation, which may support the companies to deliver quality products and/or services to the end customers on a constant basis and likewise utilize the available resources to reap numerous potential benefits. Based on the above discussion, it is evident that the four action frameworks such as creation, reduction, elimination and addition eventually assist the businesses to derive positive results and likewise accomplish their expected objectives within a set timeframe. It can be apparently observed that in this modern day context, the business market competition has increased by a considerable extent. Thus, it is to be inferred that the use of BOS has increased immensely in recent times for coping up with such extreme level of competition and getting rid of the same for ascertaining future benefits. With the changing business market conditions, it is thus projected that the preferences of the customers are also getting transformed for which the firms usually embrace BOS in a large scale. This execution of BOS by the firms in relation to the above stated context can be assessed by examining the level of generating customer value and taking effective decisions (Osterwalder & Pigneur, 2013). References Kim, W. C., & Mauborgne, R. (2004). Blue ocean strategy. Retrieved from https://hbr.org/2004/10/blue-ocean-strategy Osterwalder, A., & Pigneur, Y. (2010). Business model generation. Retrieved from http://www.slideshare.net/pavan7soni/business-model-generation-alexander-osterwalder-yves-pig Osterwalder, A., & Pigneur, Y. (2013). Business model generation: A handbook for visionaries, game changers, and challengers. US: John Wiley & Sons. Tantau, A. D., & Mateesescu, S. (2013). The green ocean innovation model. International Journal of Business, Humanities and Technology, 3(6): 59-65. Vacek, J. (2013). Business models and innovation. Retrieved from http://www.tvp.zcu.cz/cd/2013/PDF_sbornik/74.pdf WSI. (2007). Blue ocean detail. Retrieved from http://www.psclipper.com/BlueOceanDetail.asp Read More