Business Models in traditional versus pure digital industries
Marie-Hélène Delmond, HEC
Fabien COELHO, MINES ParisTech
session 3
International conference on
“DATA, DIGITAL BUSINESS MODELS, CLOUD COMPUTING AND ORGANIZATIONAL DESIGN”
24-25 November 2014 ,
Université Paris –Sud
Exploring potential of ng cost of infrastructure m skilton sept 23 2014 v1Mark Skilton
Next generation digital ecosystems and the impact of costs and monetization strategies. Part of the Next Generation Infrastructure Forum, Ovumn, London September 23, 2014
Long-standing electric utility business models are rapidly becoming outdated in light of new technologies, policy changes and more demanding consumers. Roles along the value chain are shifting, with traditional buyers gaining a foothold as value providers. To succeed in this new environment, industry model innovators will develop fresh business models, as well as the infrastructure, rules and standards to facilitate not only traditional energy generation and delivery, but also emerging products and services enabled by new technologies.
IT Mailing Contacts specializes in providing highly-responsive mailing lists, email lists and telemarketing lists from the most targeted and valued sources.
Cloud is one of that kind of digital services that is already here and materialized. Cloud services landscape is becoming more and more dense but still there is a chance for telecom players to take part in that field. Unfortunately, Communication Service Providers are late to come in and therefore it is not sufficient to put computing capacities and just sell them anymore. The economy of scale reached by current industry leaders can barely be beaten even by the largest CSPs. Therefore, some other smarter options should be found to compete with likes of Amazon, Microsoft and Google. This ppt paper is just an effort to think of CSPs role in cloud services domain and any ideas and suggestions for further discussion is very welcome.
Thank you!
This presentation is on importance on Cloud Computing, Service Delivery Platforms in shaping the service delivery and consumption in a networked world, detailing how cloud and SDP solution providers should address the market requirements and how to sell such solutions to both to Operators and Enterprises, it is generic in nature but applies to specific issues in North America and Latin America.
This is about networked future, that applications ( services) to consumers what will be driving revenue for any business in the future. Connectivity will soon become a commodity, The future is in how one can address end users service demands in a cost efficient, dynamic, efficient and specialized way with evolving technology and requirements of speed and flexibility, and interoperability. On Anywhere, Anytime, Any device.
This Presentation was done to HP CMS Management in January 2013
Exploring potential of ng cost of infrastructure m skilton sept 23 2014 v1Mark Skilton
Next generation digital ecosystems and the impact of costs and monetization strategies. Part of the Next Generation Infrastructure Forum, Ovumn, London September 23, 2014
Long-standing electric utility business models are rapidly becoming outdated in light of new technologies, policy changes and more demanding consumers. Roles along the value chain are shifting, with traditional buyers gaining a foothold as value providers. To succeed in this new environment, industry model innovators will develop fresh business models, as well as the infrastructure, rules and standards to facilitate not only traditional energy generation and delivery, but also emerging products and services enabled by new technologies.
IT Mailing Contacts specializes in providing highly-responsive mailing lists, email lists and telemarketing lists from the most targeted and valued sources.
Cloud is one of that kind of digital services that is already here and materialized. Cloud services landscape is becoming more and more dense but still there is a chance for telecom players to take part in that field. Unfortunately, Communication Service Providers are late to come in and therefore it is not sufficient to put computing capacities and just sell them anymore. The economy of scale reached by current industry leaders can barely be beaten even by the largest CSPs. Therefore, some other smarter options should be found to compete with likes of Amazon, Microsoft and Google. This ppt paper is just an effort to think of CSPs role in cloud services domain and any ideas and suggestions for further discussion is very welcome.
Thank you!
This presentation is on importance on Cloud Computing, Service Delivery Platforms in shaping the service delivery and consumption in a networked world, detailing how cloud and SDP solution providers should address the market requirements and how to sell such solutions to both to Operators and Enterprises, it is generic in nature but applies to specific issues in North America and Latin America.
This is about networked future, that applications ( services) to consumers what will be driving revenue for any business in the future. Connectivity will soon become a commodity, The future is in how one can address end users service demands in a cost efficient, dynamic, efficient and specialized way with evolving technology and requirements of speed and flexibility, and interoperability. On Anywhere, Anytime, Any device.
This Presentation was done to HP CMS Management in January 2013
The concept of platform was developed a few years ago to describe new economic models such as iTunes, ebay and others who bring the services of other private companies into their infrastructure as a revenue multiplier. This webinar will present the concept and its applications to the postal world.
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Switching Perspective: Creating New Business Models for a Changing Energy In...IBM Energy & Utilties
http://www.ibm.com/smarterplanet/us/en/smart_grid/nextsteps/index.html?cmp=agus_cxosp2gridsol-20100426&cm=c&csr=switching&cr=slideshare&ct=usbrb401&cm_mmc=agus_cxosp2gridsol-20100426-usbrb401-_-c-_-switching-_-slideshare
Business Models and Business Innovation for Electric Utilities
Business of Value Added Services in New Mobile Era: From Strategy and Busines...Ali Saghaeian
Please email me "saghaeian [at] gmail.com" for any request on VAS research, consulting and training.
This presentation includes topics such as:
The mobile 3.0 – The trends for Multimedia Services and Value Added Services
The 4th revenue curve of mobile communication – The business of Value Added Services.
Differences in doing business with Multimedia and Value Added Services than voice, messaging and access (data) services.
Mobile Operator Strategy and implications for the ecosystem
The Impact of 4th curve on mobile operator’s financials
Investing in the 4th Curve
How can Operators become Digital Lifestyle Solution Providers (DLSP)?
How to Capitalize on Big Data with Oracle Analytics CloudPerficient, Inc.
The average age of a company listed on the S&P 500 has fallen from almost 60 years old in the 1950s to less than 20 years old today. Innovative companies that are willing to embrace transformative technologies make the list today, while businesses that are hesitant to embrace change risk becoming obsolete.
Innovators use big data solutions as a competitive advantage to increase revenue, reduce cost, and improve cash flow. Turn big data into actionable insights with Oracle Analytics Cloud.
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-Big data and its architecture
-Why a big data strategy is imperative to remaining relevant
-How Oracle Analytics Cloud can help you connect people, places, data, and systems to fundamentally change how you analyze, understand, and act on information
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International conference on
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24-25 November 2014 ,
Université Paris–Sud
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24-25 November 2014 ,
Université Paris–Sud
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Senior Project and Engineering Leader Jim Smith.pdfJim Smith
I am a Project and Engineering Leader with extensive experience as a Business Operations Leader, Technical Project Manager, Engineering Manager and Operations Experience for Domestic and International companies such as Electrolux, Carrier, and Deutz. I have developed new products using Stage Gate development/MS Project/JIRA, for the pro-duction of Medical Equipment, Large Commercial Refrigeration Systems, Appliances, HVAC, and Diesel engines.
My experience includes:
Managed customized engineered refrigeration system projects with high voltage power panels from quote to ship, coordinating actions between electrical engineering, mechanical design and application engineering, purchasing, production, test, quality assurance and field installation. Managed projects $25k to $1M per project; 4-8 per month. (Hussmann refrigeration)
Successfully developed the $15-20M yearly corporate capital strategy for manufacturing, with the Executive Team and key stakeholders. Created project scope and specifications, business case, ROI, managed project plans with key personnel for nine consumer product manufacturing and distribution sites; to support the company’s strategic sales plan.
Over 15 years of experience managing and developing cost improvement projects with key Stakeholders, site Manufacturing Engineers, Mechanical Engineers, Maintenance, and facility support personnel to optimize pro-duction operations, safety, EHS, and new product development. (BioLab, Deutz, Caire)
Experience working as a Technical Manager developing new products with chemical engineers and packaging engineers to enhance and reduce the cost of retail products. I have led the activities of multiple engineering groups with diverse backgrounds.
Great experience managing the product development of products which utilize complex electrical controls, high voltage power panels, product testing, and commissioning.
Created project scope, business case, ROI for multiple capital projects to support electrotechnical assembly and CPG goods. Identified project cost, risk, success criteria, and performed equipment qualifications. (Carrier, Electrolux, Biolab, Price, Hussmann)
Created detailed projects plans using MS Project, Gant charts in excel, and updated new product development in Jira for stakeholders and project team members including critical path.
Great knowledge of ISO9001, NFPA, OSHA regulations.
User level knowledge of MRP/SAP, MS Project, Powerpoint, Visio, Mastercontrol, JIRA, Power BI and Tableau.
I appreciate your consideration, and look forward to discussing this role with you, and how I can lead your company’s growth and profitability. I can be contacted via LinkedIn via phone or E Mail.
Jim Smith
678-993-7195
jimsmith30024@gmail.com
Senior Project and Engineering Leader Jim Smith.pdf
Marie-Helène Delmond: Business models in traditional versus pure digital industries
1. BUSINESS MODELS IN TRADITIONALVERSUS PURE
DIGITALINDUSTRIES
Marie Hélène DELMOND, HEC
Fabien COELHO, MINES ParisTech
DATA, DIGITAL BUSINESS MODELS, CLOUD COMPUTING AND ORGANIZATIONAL DESIGN, NOV. 24-25 2014
2. Research Objectives
Analyze the evolution of business models in digital economy
See if those changes also apply to traditional industries
Understand IT drivers
Exploratory case-based research
Cigref / ISD Research programme
3. Research design
Literature Review (Strategy, Service, Marketing, IS/IT)
Industry value chain and mediation strategies
Value proposition: products & services
Business Models: importance of partnerships, value co-creation
2 case studies in Digital / Traditional business environment
Rexel Case Study:
Interviews (CIO, Marketing/Customer Relationship, Supply Chain, Strategic Planning)
Review of publications
Salesforce.com Case Study
Interviews (Marketing Director France and several Network Partners)
Review of publications
4. Evolution of Industries Value Chain & Mediation
Strategies in Digital Economy
Source: Andal-Ancion, Cartwright & Yip (2003), The Digital Transformation, MIT Sloan Management Review
NIT drivers Electronic deliverability Aggregation effects Network effects
Information intensity High contracting risk Standardization benefits
5. Value Proposition:
Products, Services & Solutions
Shift from a product-based toward a service-based economy (Vandermerwe
& Rada, 1988)
Differientiated
Product
Value
Proposition
& Price
high
low
Role of servicesAccessory Central
Augmented
Product
Differentiation :
Product + value
added services
& solutions
Source: adapted from Karsenti & Ulaga (2010)
Accessory
Basic
Product
Commoditization
Continuous product and service innovation protects from commoditization
and keeps value proposition high
6. Evolution of Business Models
Emergence of the concept of Business Model in the 90s
(Internet startups development)
Building blocks
• Core Strategy (mission, products & services, competitive advantage)
• Strategic Resources (assets, core processes & competencies)
• Customer Interface (Fulfillment, Information, Relationship, Pricing)
• Value Network (Relationship with key partners)
Hamel (2000)
7. Evolution of Business Models:
Value co-creation
All stakeholders co-produce value (Normann & Ramirez, 1993)
Open innovation (Chesbrough & Appleyard, 2007)
Customers
Develop relationships
Customer Knowledge
Customization
Products & services co-creation
Network effects
Partners
(Suppliers, competitors, outsiders)
Develop relationships
Provide key resources
Products & services co-creation
Network effects
Access to customer
Company
Value Co-creation
8. Rexel
Rexel: one of the largest distributors of electrical parts and supplies in the
world
• 28 000 people, Revenue €12 Mds 2010 (19% France)
• 36 countries, 2200 branches, 40+ banners, 98 logistic platforms
• N°1 North America & Asia-Pacific, n°2 Europe
3 end-markets
• Industrial 32%, Residential 25%, Commercial 43%
Highly varied customer segments
• Electricians & SME
• Key accounts (industrial, commercial, service)
• Large projects, EPCs
• …
New stakes
• Services & value-added solutions, energy efficiency, renewable energies, movements in the industry
value chain
Also: strongly local (culture, organization, history…)
80% to 90% of revenue from products sale
9. Rexel - Focus on Customer Segment 1:
Independent Electricians & SMEs
High % of Revenue – traditional activity
• Core business, average order €100
Development of value-added services
BM evolution: from distributor to pivotal actor
New BM: direct link with customer, solutions provider
• Customer needs awareness, Problem solving, Suppliers & products
selection, Products delivery, Use of electricians’ network (specialty,
proximity)
Procurement Logistics Others
Pick & pack Information on new products
Inventory management Training,
Delivery options Sales training
Web site :
orders fulfillment & tracking,
customized product catalog
and pricing
Inextel TV – trends, market
opportunities, partnership with
Rexel
New services to be added
Supplier
Rexel
Electrician
End
Customer
Supplier
Electri
-cian
Rexel
solution
End
Customer
10. Rexel - Focus on Customer Segment 2 -
key accounts & large projects
Objective: become a multi-services key
partner
Mines project in Latin America
• First phase: plant deployment
• Coordination with EPC
• Logistics services beyond electrical scope
• Second phase : exploitation
• Multiservices solution
Strong competition
• Ex Schneider Electric (Bechtel – gas liquefaction plant in
Australia)
Strategic risk
• Be second row
Sup
plier
Sup
plier
Rexel
(solution)
End
Customer
Rexel
(products)
S Solution
provider
(services)
End
Customer
S
S
11. Rexel – remaining questions
Global / local Balance
Services monetization
New value added services for electricians
Energy efficiency
• Attracts new entrants
• Ability to provide full solution?
• Ability to establish partnerships?
12. Salesforce.com (SF)
Emblematic player in cloud computing business
More than 3M users worldwide
71% America, 18% Europe, 11% Asia Pacific
Abundant offer, relying on multiple partnerships
Software as a Service (Saas) offer: subscription/user/month
• Sales Cloud (for sales agents)
• Service Cloud (for marketing & support functions)
• AppExchange
Platform as a Service (Paas) offer
• Force.com
• AppExchange
13. Salesforce.com Ecosystem & value co-creation
Salesforce.com co-produces value with its various partners :
• Customers,
• Consulting partners integrating SF applications in their missions,
• and Sellers/ISV partners providing solutions using AppExchange.
Big Companies
New functionalities
Specific devt (CISCO)
Idea Exchange
Customers
AMD, Nokia, Cisco…
P
14. Salesforce.com Ecosystem
Numerous and various Business Models on
AppExchange and also different levels of cooperation
• Co-investment: financial contribution by SF
• Co-development: shared development teams
• Co-commercialization: product sold both by SF and its partners
• Co-sales: joint bid proposal
• Co-mplement: new value added functionalities to SF offer
• Co-nnexion between applications
• Co-llaboration: working together, e.g. with integrator
• Co-opetition: added functionality competing with SF product
• Co-integration: upward compatibility with SF new releases (3 / year)
15. Salesforce.com Strategy
SaaS Business Model: ‘risk-free offer for the customer, which can be
easily augmented according to its needs’
Pay as you go - volatile Business Model, you have to keep on developing
new services to achieve stickiness
PaaS offer Force.com and cooperation through AppExchange aim at
developing new services and sustain SaaS offer
PaaS results on its own still difficult to assess
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31
0
20
40
60
80
100
2003-2011
$
Average Monthly revenue per subscription
$/subs/m
16. Salesforce.com – key elements
2 complementary Business Models,
Software as a Service & Platform as a Service
SaaS basic offer: low cost (risk = turn commoditized)
PaaS / AppsExchange: customization & value added services
Reinforce SF.com offer through Value Net with partners
Share tools
Share customer knowledge
Flexibility & diversity of relationships
Open innovation
17. Digital vs Traditional
Rexel
• From a traditional wholesaler pattern, Rexel tries do assess its intermediation
role in the value chain. E.g. support the electrician in order to provide global
solution to its customer; and compete as a complete provider in case of big
market.
Salesforce.com
• SalesForce is well known as a SaaS Pioneer. Nowdays SF is able to build a
customized service within a specific context, integrating various applications by
using its PaaS offer
Industry value chains evolve in both contexts
Positions adopt various ad-hoc configurations
Companies struggle to have direct access to
customers
Salesforce’s platform enables the company to
keep the leading role in its ecosystem
18. Digital vs Traditional
Rexel
• Core competency: supply chain
• Customization: application customized for each electrician, multi-service
provider for large accounts
Salesforce.com
• Core competency: CRM as a Service
• Customization: AppExchange, PaaS
Both companies offer embedded
customized solutions and improve their
technical core offer with high value services.
Salesforce relies on its ecosystem to create
new products and services
Rexel relies mostly on itself to create new
products and services
19. Digital vs Traditional
Rexel
• Core Competency: supply chain
• Global solution (mines) or specialized solution (smart grid, energy savings) but
real difficulties to establish partnerships
Salesforce.com
• Core Competency : Software as a Service, Platform as a Service
• Contributions of various partners following various business models enrich
Salesforce SaaS or PaaS core systems.
Both companies objective is to build
a global solution around its core
competency
SF successfully organized its
ecosystem around its platform
Rexel has huge difficulties building
an ecosystem