Business models, innovation, reengineering, culture change and more can sometimes not produce the expected or at least the immediate results you were expecting. This article is a good read. Another look or a fresh perspective may make the difference.
Excerpt: If you’ve had a bad experience with an operational improvement effort (like Six Sigma or Business Reengineering), or if you haven’t given it much attention lately, you should take a fresh look. Many companies and executives have been disappointed with these efforts when results weren’t sustained and inefficiency crept back in. But improvement has improved.
I see three forces behind this trend:
Read full article via Operational Improvement Has Improved – Brad Power – Harvard Business Review.
Recommended for all entrepreneurs and startups. The article addresses the basic thought process and includes some how-to — important launch direction in your role as entrepreneur
Excerpt: I’m involved in two startups. In both cases, we are going through the process of developing a model that evaluates all aspects of the business — our target customers, products and services, organization, infrastructure, channels, financial projections, and funding needs.
In particular, the process of building a solid financial model forces you to think through things like payroll costs, equipment purchases, research and development, sales channels, and even office space. I found myself adding new elements to every part of our business model as I focused on the financial aspects.
I was reminded this week of how important it is to view them all as a whole instead of as the individual parts. I will share the details on one of those startups in this article.
Read full article via Analyzing a Startup, and Pivoting | Practical eCommerce.
A good read on some important ingredients to include in your innovation tasks. It is innovation with issues uppermost in today’s world.
Excerpt: CEOs of large companies face a conundrum: they are confronted with a growing number of frugal consumers clamoring for affordable solutions, yet their existing corporate culture and incentive systems are designed to support a “bigger is better” business model — not to deliver more with less. As the Age of Austerity dawns, however, corporate leaders will have no choice: they will have to bite the bullet and infuse their organizations with a frugal mindset. In sum, CEOs need a frugal innovation agenda.
Frugal innovation is the ability to innovate cost-effectively and sustainably under severe resource constraints.
Read full article via The CEO’s Frugal Innovation Agenda – Navi Radjou, Jaideep Prabhu, Simone Ahuja – Harvard Business Review.
Another reality check from HBR this morning. By example, author describes the dangers in standing still. Leadership and management
Excerpt: This vignette raises a key leadership question: Why do leaders wait too long to modify or abandon their business models?
Read full article via Kill Your Business Model Before It Kills You – Ron Ashkenas – Harvard Business Review.
Recommended for all small business owners — takeaways and how-to.
Excerpt: The current economic environment in the United States and around the world is challenging for banks and business alike. Given the macroeconomic forecast, financial institutions can no longer grow their way out of their problems. Business areas that traditionally provided revenue growth for financial institutions are not growing sufficiently to overcome new capital and regulatory requirements, and activity levels of several major financial sector businesses are flat or declining.
Increased regulation and capital requirements along with limited revenue leverage will require business-model changes boost profitability. Leading institutions are implementing continuous expense management programs to extract value from business-model changes by focusing on efficiency through each key step in the budgeting and reporting systems.
Watch video and download report via Continuous expense management for financial institutions: PwC.
A great read from HBR this morning on innovation and strategies. Leadership and management
Excerpt: More and more companies I see these days are making strategic process changes to drive unprecedented business model innovation. Forbes has embraced online collaborative publishing as it adds a substantial online presence to its traditional print magazine. Healthcare organizations are implementing electronic health records systems so they can migrate from islands of medical services to sharing patient data across care providers. Consumer packaged goods manufacturers are monitoring social media to get real-time information on their customers’ perceptions and share it with brand managers.
Business model innovation — often enabled by new technology platforms — isn’t new
Read full article via Business Model Innovation Through Process Change – Brad Power – Harvard Business Review.
A discussion of today’s changes and what you need to compete today. Recommended small business leadership and management. Information technology
Excerpt: Now more than ever, the customer is king — in the driver’s seat with access to more data, on more devices, than ever before. As a business leader in this new environment, how will you compete for customers? Retain your base? Grow your business? Today’s business models are fast becoming obsolete with cloud computing, new security challenges, and consumer demands for access to information with a superior experience. You need an integrated approach to leveraging the technologies that will drive this transformation across a plethora of devices.
In this Harvard Business Review video webinar, leading business and IT thinker Andrew McAfee makes the case for integrated solutions, by explaining the three “forces” that are converging, which stand to redefine the business landscape.
View webinar video here via Leverage Technology for Business Transformation – Jason Sylva – HBR Events – Harvard Business Review.
This is a reprint of the IBM research and report on business models and innovation — when and what is appropriate for your business. Small business takeaways of how-to within the study of larger companies. Leadership and governance recommended read. Another long read download.
Excerpt: Not every organization needs to innovate its business model immediately, but the capabilities need to be established in order to act when the time is right.
Three capabilities – we call them the Three A’s – can improve the execution of business model innovation: organizations need to be aligned with customer value, analytical to gain insight from differentiated intelligence, and enabled by an adaptable operating model.
Download full paper here via IBM – Seizing the advantage: When and how to innovate your business model.
This is a long read download paper (37 pages) — it is a reprint from 2011 and gives you great definition and knowledge into the basics of business models across a range of kind of model and within large companies. Information provides takeaways how-to and even how-not-to for the small business owner. Leadership and governance
This paper defines four basic business models based on what asset rights are sold (Creators, Distributors, Landlords and Brokers) and four variations of each based on what type of assets are involved (Financial, Physical, Intangible, and Human). Using this framework, we classified the business models of all 10,970 publicly traded firms in the US economy from 1998 through 2002. Some of these classifications were done manually, based on the firms’ descriptions of sources of revenue in their financial reports; the rest were done automatically by a rule-based system using the same data. Based on this analysis, we first document important stylized facts about the distribution of business models in the U.S. economy. Then we analyze the firms’ financial performance in three categories: market value, profitability, and operating efficiency. We find that no model outperforms others on all dimensions. Surprisingly, however, we find that some models do, indeed, have better financial performance than others. For instance, Physical Creators (which we call Manufacturers) and Physical Landlords have greater cash flow on assets, and Intellectual Landlords have poorer q’s, than Physical Distributors (Wholesaler/Retailers). These findings are robust to a large number of robustness checks and alternative interpretations. We conclude with some hypotheses to explain our findings.
via Do Some Business Models Perform Better than Others? by Thomas Malone, Peter Weill, Richard Lai, Victoria D’Urso, George Herman, Thomas Apel , Stephanie Woerner :: SSRN. vua MIT Sloan Management
Small business takeaways — business models and innovation — the how-to.
Excerpt: One of many good reasons for you to focus on your business model is that companies focusing on Business Model Innovation outperform their industry peers in terms of operating margin and total shareholder return. In this in depth article Marc Sniukas provides you with a framework to describe your business model in three easy steps; a process to start and drive Business Model Innovation within your company and an overview of tools and how they can be used in Business Model Innovation.
Read article and download paper via How to Make Business Model Innovation Happen | Innovation Management.
Particularly for newbies just getting started or seasoned executives who want to add or change their business focus. This read gives you the overview of many of the most popular and easily identified models via examples. A tool and reference for you.
Excerpt: Business models have been defined and categorized in many different ways. This is one attempt to present a comprehensive and cogent taxonomy of business models observable on the web. The proposed taxonomy is not meant to be exhaustive or definitive. Internet business models continue to evolve. New and interesting variations can be expected in the future.
The basic categories of business models ……
Read about models in the list of kinds via Business Models on the Web | Professor Michael Rappa.
This is a reprint but well worth bringing it to your attention now — great information and takeaways for nonprofit ideas and business models. Recommended
Excerpt: For-profit executives use business models—such as “low-cost provider” or “the razor and the razor blade”—as a shorthand way to describe and understand the way companies are built and sustained. Nonprofit executives, to their detriment, are not as explicit about their funding models and have not had an equivalent lexicon—until now.
Read full article via Ten Nonprofit Funding Models | Stanford Social Innovation Review.
Before you move to the cloud, examine the implications from a tax standpoint. The taxes change based on the country in which you are doing business. Best practice advice, check and recheck everything with your friendly CPA to know what you are getting into and the implications to your small business BEFORE you make a move.
Excerpt: KPMG recommends that a company moving to a cloud-based business model should examine its local country tax position to consider the character and source of the cloud income and/or payments and whether the cloud operations result in new or additional income, withholding or indirect taxes. Executives need to be mindful of the location of the servers and other infrastructure to take advantage of local incentives, while managing possible permanent establishment challenges made in the jurisdiction in which the infrastructure is located.
Read full article via Cloud Computing Exchange | Presented by Information Management. From KPMG via Information Management
Good insights and points for both nonprofits and for profits……….partnerships for gain and good
Excerpt……. How can partnerships help the nonprofit sector navigate legislative hurdles, new leadership, and antiquated business models? In this audio lecture, recorded at the Stanford Social Innovation Review’s 2011 Nonprofit Management Institute, Tides CEO Melissa Bradley shares the opportunities she sees for increasing scale and impact through partnerships. Her lecture examines the current landscape of the social sector, and explores what the terms scale and impact should really mean. Citing a number of case studies, including collaborations between for-profits, nonprofits, foundations, and even unions, Bradley provides insight into what makes partnerships successful and offers up best practices for organizations looking to work together.
Listen to podcast here……via Partnering for Scale and Impact | Stanford Social Innovation Review.
Great business model strategy defined ……. is your strategy defined?
Excerpt……..show how top-performing companies typically develop repeatable models that incorporate their strategy in front-line activities. These models reflect three fundamental design principles:
Read full article….via Are You Fighting the Future or Adapting To It? – James Allen – Harvard Business Review.