Business Needs
Introduction
A business model is an "abstract representation of an organization, either textually or graphically, of all related concepts, financial arrangements, and the core portfolio of products or services that the organization offers and will offer based on the actions necessary to achieve the strategic goals and objectives."[1][2] This definition by Al- Debei indicates that the value proposition, value architecture (organizational and technological infrastructure), financial value and network value are the primary dimensions of business models. business.[3].
In theory and practice, the term business model is used for a broad set of descriptions that represent core aspects of a business, including purpose, business process, target market, offerings, strategies, infrastructure, organizational structures, business practices, operational processes and policies. The literature has offered various interpretations of business models. For example, they are usually defined as designs of organizational structures to take advantage of a business opportunity.[4] Extensions of this definition emphasize the use of coherence in the description of business models.[5].
Business models are used to describe and classify businesses, specifically in an entrepreneurial context, but they are also used within companies by managers to explore development possibilities in the future. Private, well-known business models can be like "recipes" for managers.[6] Business models are also often mentioned in the context of accounting within the development of public reports.
History
Over the centuries, business models have become more sophisticated. The bait and hook model was introduced in the 19th century. This involves offering a basic product at a very low cost and then making recurring charges for similar services or top-ups. Some examples are: rake (bait) and spare parts (hook); cell phones (bait) and billable time (bait); printers (bait) and cartridges (bait); cameras (bait) and development (hook). A variant of this model is used by Adobe, a software developer that gives away the document reader but charges for the editor.
In the 1950s, new business models emerged with McDonald's restaurants and Toyota. In the 1960s, the innovators were Wal-Mart and Hypermarkets. In the 70's, new models emerged with FedEx and Toys "R" Us; in the 80's, Blockbuster "Blockbuster (company)"), The Home Depot, Intel, and Dell Computer; the 90's and 2000's with Southwest Airlines, Netflix, eBay, Amazon.com, Google, and Starbucks.