Business Model Innovation

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Video: Sustainability: The New Business Model Opportunities

Since 2010, MIT Sloan Management Review and The Boston Consulting Group (BCG) have been charting how organizations are responding to sustainability as a source of competitive advantage. This year we found that nearly 50 percent of companies have changed their business model because of sustainability opportunities. In this video, David Kiron, executive editor at MIT SMR, and Eugene Goh, a principal with BCG, discuss highlights of the report and specific company examples.

Image courtesy of Amazon.

Creating Value Through Business Model Innovation

Companies are increasingly turning toward business model innovation as an alternative or complement to product or process innovation. Changes to business model design can be subtle; even when they might not have the potential to disrupt an industry, they can still yield important benefits to the innovator. The article offers a number of examples of business model innovation and poses six questions for executives to consider when thinking about business model innovation.

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Achieving Successful Strategic Transformation

Companies that are able to radically change their entrenched ways of doing things and then reclaim leading positions in their industries are the exception rather than the rule. Even less common are companies able to anticipate a new set of requirements and mobilize the internal and external resources necessary to meet them. The article focuses on three companies that transformed themselves and compares them with three other companies from similar industries that hadn’t been required to make a dramatic shift.

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How to Identify New Business Models

Companies traditionally pursue growth by investing heavily in product development so they can produce new and better offerings; by developing consumer insights so they can satisfy customers’ needs; or by making acquisitions and expanding into new markets. This article identifies a fourth method: “business model experimentation,” or using thought experiments to quickly and inexpensively examine new business model possibilities.

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Winning the Race With Ever-Smarter Machines

The capabilities of computers are now improving so quickly that concepts can move from the realm of science fiction into everyday life in just a few years, rather than a lifetime. Rapid advances in information technology — computer hardware, software and networks — are yielding applications that can do anything from answering game show questions to driving cars. But to gain true leverage from these ever-improving technologies, companies need new processes and business models.

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Image courtesy of Flickr user alvazer.

The Business Models Investors Prefer

Why are investors so bullish on companies like Apple and Disney? Is it metrics, management, industry prowess, good investor relations or good timing? Probably all of these. But something else may be at work, too. According to research conducted at the MIT Sloan School of Management, the stock market consistently values certain types of business models more highly than others. In recent years, investors have favored models focused on intellectual property and highly innovative manufacturing.

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Bringing Open Innovation to Services

Services comprise more than 70% of aggregate gross domestic product and employment in the Organization for Economic Cooperation and Development countries. As a result, both individual companies and entire economies face the challenge of how to innovate in services. One suggestion: Companies should both organize their innovation processes to be more open to external knowledge and ideas and also let more of their ideas and knowledge flow to the outside when not being used internally.

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What to Do Against Disruptive Business Models (When and How to Play Two Games at Once)

Fighting against a disruptive business model by rolling out a second business model is one option for companies to consider. But to make that work, you need to avoid the trap of getting stuck in the middle.

Image courtesy of Apple Inc.

A Business Plan? Or a Journey to Plan B?

From Apple to Twitter, some of the most successful businesses are not what their inventors originally envisioned. The Twitter story, in fact, is a powerful reminder that an entrepreneur’s main job is not to flawlessly execute the business idea so lovingly articulated in his or her business plan. It’s to embark on a learning journey that may or may not reach the destination originally envisioned. Instead, the company may end up at a more successful Plan B.

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Showing 21-34 of 34