Business Models.



Whatis a business model?

Osterwalderand Pigneur (2010) defines business model as a rationale on howorganizations or companies creates, delivers, and capture value togive them a competitive advantage. The key goal of any organizationis to acquire market share through improved sales and revenuegeneration. Therefore, many organizations create a business modelwhich attracts customers and leverages them. Hence, business modeldeals with the way an organization packages itself in the market orcustomers to capture value.

Agood business model is defined and described using the nine buildingblocks that shows the pathway how an organization or business isgoing to make money or generate its revenues. The blocks which makeup an effective business model include financial viability,infrastructure, customers, and offer (Osterwalder &amp Pigneur,2010). It acts as a blueprint for the strategy which the organizationis to implement through its structures and systems. In any businesscase, business model will determine the extent in which it will gobecause it lays the framework according to the organizational goals.Having a strong business model will enhance the organizationalperformance, hence meeting the goals.

Definitionof business model according to case literature and business modelgeneration

Thebusiness model can be described as a concept which is shared to allowan organization to easily manipulate and describe business operationsin order to create new strategic options (Osterwalder &amp Pigneur,2010). It becomes difficult without a shared language to challengeinnovative and business models. Therefore, business models providethe platform where organizations can challenge the assumptions andinnovative ideas. It provides a challenging environment which givesthe business opportunity to weigh the available options in ensuringthey are worth pursuing.

Inother instances, some scholars have defined business models as waysin which an organization makes its money (Ouden, 2011). For instance,an organization has to be familiar with cases related to businessmodel such as knowing the organizational target market, customer’schallenges and problems, organizational value to customers, the coststructure of the organization, ways of generating revenues and theorganizational profit margin (Ouden, 2011). Therefore, it can referto core business concepts such as the purpose of the business,process, operation process, strategies, structures and customers andtrading practices.

Roleof value proposition in successful business model

Thevalue proposition is very important in creating and buildingsuccessful business model for customers. One of the ways of valueproposition is through innovation (Osterwalder &amp Pigneur, 2010).Innovation plays essential role in giving a company a competitiveadvantage as it creates new value to the existing products orservices. This makes customers to identify themselves with thecompany, hence using the services and goods. Similarly, the creationof new ideas adds value to customers since they get new experiencefrom the created values.

Secondly,other companies have managed to create value from information byfiltering and connecting. Such companies are Amazon and Google(Osterwalder &amp Pigneur, 2010). They have made it easy for theconsumers to find relevant information they want within the shortesttime possible. Therefore, value proposition plays a significant rolein ensuring client satisfaction.

Similarly,the value proposition is very effective in identifying and addressingthe client’s problems (Ouden, 2011). The organization is able tofind solutions to customer’s problems when they implement valueproposition. As companies strive to create value on their productsand services, they look for the problems and challenges which theircustomers experience. The business will look for the services whichpose problems to the customers and address the challenges. By doingthis, the business is creating value proposition because it is easingthe challenges the customers’ experiences.

Howbrainstorming impact successful business

Brainstormingis very effective for any business. It ensures the success of thebusiness through participation. For instance, brainstorming impactthe business success because it leads to better decision (Ouden,2011). Brainstorming involves tackling of complex issues by the useof best practices which leads to better making of decisions.Similarly, it involves the employment of techniques in the businesswhich ensures success (Osterwalder &amp Pigneur, 2010). Moreover,brainstorming will make the organization take action following thefindings, hence ensuring its success.

Secondly,brainstorming is very essential in helping the organization in theplanning process. Specifically, it is useful in organizations whichhave the responsibility of detecting fraud. In many studiesconducted, the findings reveal that brainstorming resulted to bestpractices which are essential in moving the organization forward(Ouden, 2011). Some of them include inclusion of subject matter andopenness to input of every member of the organization. Giving everymember in the organization a chance to contribute is very useful inensuring organizational success since it incorporates their strengthin decision making and finding solutions.

Moreover,brainstorming can help in ensuring organizational success byconsolidating ideas. In will minimize manager’s bias which has beenthe barrier to visions of many organizations (Osterwalder &ampPigneur, 2010). When all the ideas are consolidated in one place, iteases incorporation since the best ideas are placed into practicemaking it effective in ensuring the organization meets theobjectives.


Osterwalder,A. &amp Pigneur, Y. (2010). Businessmodel generation: a handbook for visionaries,

gamechangers.Hoboken, NJ: John Wiley &amp sons.

Ouden,E. (2011). Innovationdesign: creating value for people, organization, and society.New