Talk:Business model

Examples section is far too long

The Examples section is far too long and poorly formatted. Since every example is linked, I would suggest removing the descriptions to have a simple bullet point list. Ajr1990 (talk) 11:09, 1 August 2018 (UTC)

Frameworks section is problematic

The descriptions of the frameworks mentioned are vague and sometimes more or less marketing speak. I suggest to rewrite the bullet points to actually summarize the frameworks or (failing that) remove the bullet points and just link each framework with no further explanations. LarsHolmberg (talk) 07:57, 14 June 2017 (UTC)

Outdated Article

As I noticed article is dealing with monetization (revenue model) and business model structure issues (set of activites). However, this view is 10 years old by now. The emerging three views are given after a great deal of aggregation in the work called "The Business Model: Thoeretical Roots, Recent Developments, and Future Research" Zott et al. 2010. They are - E-business, Strategy&Organization, and Innovation and Tech.

I personally started examination of the topic a month ago with this article and now I see that the article requires 90% revision.

Unsigned by 109.188.237.37 23:27, 6 September 2010

Most of us are no expert in this field, and little Wikipedia article are completely up to date. But on the other hand this article should explain more than the contemporary view on business models.

If you want to add a specific framework, for example:

• the generalization of two types of business models: monetization (revenue model) and business model structure issues (set of activites).
• or three types of business models: E-business, Strategy&Organization, and Innovation and Tech.

you have to be aware that this not generally accepted and works only in specific field. I however thing it is interesting to investigate if this can be added to the article. Are you a member of the Business Model Innovation Hub? I could raise this question there as well..!? -- Mdd (talk) 15:25, 7 September 2010 (UTC)

No I'm not a member there. I'll take a look later on this resource but a glanse on the resorce directs to an idea of the technology bias in the resource. Are you the man from Rotterdam there?

Regarding general acceptance, I'd suggest that review of the scientific (mostly) literature provided by the research "Business Models: Roots, Developments, and Future" (Zott et al, 2010) is a good proxy to 'general acceptance'. There team tracked wide range of researches in scientific journals from the beginning (1995) of the term first use and the team provides above differenciation of the term "Business Model". I personnally read some part of those papers (`30 papers) and I'm agreed with the research. Moreover, my scientific advisor seems to be compelled as well.

If I add some specific (additional) framework I'm affraid it'll create mess in the article, that's why I up this question. By the end of the next week, however, I could write my proposition. —Preceding unsigned comment added by 84.52.73.169 (talk) 21:21, 7 September 2010 (UTC)

Changes

Thanks for the new intro, much better. Thinkstorm (talk) 18:04, 4 December 2008 (UTC)

Article revisted

I just revjited the article and saw some inconsistencies at the beginning:

• The previous version states that a a business model describes a "Profit-Producing System", which is not necessarily the case. A non-for-profit and not-for-profit organization still has a business model without making profit. There are lots of other organizations that have a business model and actually make a loss. For exactly that reason an earlier version broadly said that it is "a framework of creating value", with the term of "value" being very vague - and people might have a different perception of values, like health environment, more money, less clutter, no loss, etc. I know that Osterwalder also mentions profit in his slidedeck at http://business-model-design.blogspot.com/2006/11/business-model-template-designing-your.html. I simply wouldn't follow that.
• The previous version also stated that ih has to have "an important degree of independence from the other systems within an enterprise". First of all, the article never comes back to that statement. Hence my disbelief. I don't see why it has to be independent: I'm seeing a lot of combined business models that are not independent. Maybe such a "cluster" of business models could in fact be seen as a single business model, but I just don't see enough scientific proof for that within the current article. Second, the introduction clearly said "formal and informal", because some business models are rather informal and hence do not have an "important degree of independence".
• I omitted the "widely" within the next sentence - no additional value.
• the previous version said "description", but not description of what. I re-instated the thought that the framework describes, stands for, or represents business mechanics. As a compromise to the above mentioned independence degree, I now introduced "core aspects of a business". The previous version was also misleading, as the "..., including purpose, ..." part was meant to be an example for informal/extended descriptions beyond e.g. cash-in / cash-out.

Thinkstorm (talk) 06:01, 3 December 2008 (UTC)

A couple of changes

I reverted and edited a couple of changes:

• I feel that previous deletion of the abstract definition (... formal and informal description of ...) was hiding the fact that the nine building blocks are in fact a conceptualization and, moreover, a synthesization of many different ones.
• However, previous version did not have the actual citations of other conceptualizations this synthesis is based on --- maybe someone can go through the PDF and add them
• Though I can see why personal advertisement of opinions should be omitted, authorship and credit should be stated. I reinserted Alexander Osterwalder's thesis, this time as a footnote
• Not only are the building blocks important, but also their relationship towards each other in order to establish a real template. I hence reverted the image deletion.
• Some minor cleanup of footnotes and references

Thinkstorm (talk) 07:11, 10 May 2008 (UTC)

Would it make sense to make include in this article definitions of "business model" by different modern scholars? For example, Scott Shafer defined a business model as a "representation of a firm's underlying core logic and strategic choices for creating and capturing value within a value network." There are quite a few other definitions out there in literature.

Jwyrwas (talk) 16:35, 28 August 2009 (UTC)

Historical overview

In your historical overview of business models I suggest you go back and include Cyrus McCormick and the McCormick Harvesting Machine Company. His business model of financing the purchase of harvesters to farmers on credit revolutionized that business. See for example Afred Chandler's "The Visisible Hand." Wedgwood's business model also deserve mentioning.

Soren Bisgaard

Eugene M. Isenberg Professor of Technology Management

Eugene M. Isenberg School of Management

University of Massachusetts-Amherst

I am not familiar with the McCormick model. Please add a sentence or two to the article. If you have time, an article on it would be great. mydogategodshat 22:35, 26 Jan 2005 (UTC)

The bait and hook model refers to charging "excessive" amounts for the blades. Excessive by what standard?

--

In the articles on business models list the very last item -- 'The online content business model' just gives a link to a word definition for 'online', not sure if there was another more appropriate page that was intended for this link?

--

The link "Business Models on the Web" isn't a particularly good website and should maybe be removed.

Business models are nothing but the way you explain your growth in simple terms to a person who would like to invest in your business. It should be impressive enough to win the confidence of the investors and must be easy to ubderstand and grasp. --

This history section lacks any information on the origin of business models (eg when business models were first formalised), where, when, etc.FreeFlow99 (talk) 15:57, 20 December 2012 (UTC)

-- I've an issue with the term "excessive" here as well. "Excessive" simply means "beyond normal limits" but the connotation here is negative. Is there a better word to use? Ziggles Metropolitan 14:12, 17 March 2006 (UTC)

--

It might makes sense to merge the article business model design with this article. Opinions? Kborer 23:04, 17 October 2006 (UTC)

A blog entry

I don't want to disturb the content as it exists at the moment, but have written a blog entry on definitions for business model by Johan Wallin, and by Rafael Ramirez and Johan Wallin . The blog entry is at http://coevolving.com/blogs/index.php/archive/value-creating-systems-and-business-models-systems-thinking-inside/ , with the definitions provided (and build up background).

Daviding 11:31 EDT, July 7, 2007.

Loss leader business model

Would the loss leader business model fall in with the razors and blades business model? Essentially they are the same thing correct? 8:36, 23 April 2008 (UTC)

Virtual Business Model

In talking with a couple other businesses in my industry, I have noticed that "Virtual" businesses are becoming more visible on the internet. I'm merely here researching business models to begin my own startup, so I don't know much about them, but from what I have gathered from those I've talked with, a Virtual Business is a collection of individuals that have incorporated, but have no common building for which meetings and daily normal business is conducted. Most commonly, they converse via email and cell phone. Wouldn't it make sense that the "Virtual Business Model" should be in your list. I also suggest losing the Online business model as well, since it only redirects to a definition of "Online". CertGuard (talk) 12:41, 30 March 2008 (UTC)

Do business models Matter? issues

This section is very unencyclopedic and should be either reformatted or removed. It contains very speculatives questions and seems to be poorly sourced.JakeH07 (talk) 06:24, 1 January 2009 (UTC)

I agree. This is an almost worthless, highly Amero-centric (American view) entry in which there is very little knowledge, and a high level of distorted information.

"The oldest and most basic business model is the shopkeeper model" is incorrect. Long before people settled down and began to make buildings for commerce, business was conducted by nomadic peoples who met in camps and exchanged goods, either through barter, or using mediums of exchange such as gold or rare seashells. In New Zealand, there were no shops prior to Europeans arriving, and no money in the European sense, yet business was conducted and business models can be shown to have been operative. The word for money was Utu. The word for revenge was Utu. In fact, Utu meant something similar to "balance"... think about the scales used in commerce and the scales used in justice. (See [1] for the Maori dictionary explanation [amusing that Wikipedia has no mention of this at all])

For this article to be worthwhile, at a minimum, it should be written by someone with a degree in business who is actually conversant with the theory and then disclosure should qualify that it is talking about the western, or American model, not arrogantly presuming that America's view of reality is the world view (sort of like presuming because it is called the World Series, baseball is a world-game when all the teams are American).

Business models include barter, use of money or other medium of exchange. They address both wealth creation and wealth conversion. For example, nomads converted solar energy to human wealth: The sun caused grass to grow. They captured and domesticated sheep, cattle, horses and other grass-eating animals, thus creating wealth based on "chattel". Wealth conversion occurs when other nomads figured out that if they rode on horses with weapons, they could steal chattel. From this came gangs, then armies, then nation-states based on fortified towns. The farmer who then grows crops creates wealth (using sun, rain and soil). The soldier who comes by from one of the fortified towns and says "If you give me some of your food, I will protect you from that other soldier from that other town who wants to steal your food" is a wealth converter, he does not actually generate wealth. The business model of the East India Company was a shift in technology, where they used ships not caravans, thus avoiding having to pay fortified towns along the route home. To protect them from pirates and other nation-states, the British Navy became a world power, and the business model of the East India Company including setting up colonies and installing governors. While the East India Company is defunct, it's families are still some of the most powerful in the world... they just changed their business model from one corporation to many. But it is important to remember that their wealth came from a monopoly given by QE-I on 31 Dec. 1600. Monopoly is a major business model (patents give one a "royalty" for a number of years, so the price is what the market will bear). In the case of the East India Company, most profits came from opium and caffeine (tea), tobacco, alcohol, firearms and slaves & slavery-based industries, which is an interesting commentary on its business model based on cravings and control.

In business models, shifts in technology (Microsoft) and organising a disorganised business (McDonalds) are wealth creating models, In the case of Microsoft, however, there is also a defacto monopoly business model (wealth conversion) where they dominated the market until Linux & its derivatives came along. In the case of McDonalds, however, there is an "externalising" business model that is operative, where McDonalds makes profits while medical insurance must be paid to cover the cost of disease produced by such a highly processed, sugar and fat based diet, which again is a wealth conversion model.

Business models are based on a mix of wealth creation and wealth conversion. Neat models like the one cited (Osterwalder) fail to address the underlying reality. Rigging the rules was a major part of business conducted in the USA over the past 16 years, so one gets a triple A rating on a mortgage backed security based on past performance rather than properly citing the inflationary spiral of house prices without a commensurate spiral in the official inflation rate. Getting taxpayers to pay for R&D and then flog it off to "friends" in the private sector for a small portion of its cost (AKA privatisation) is a major business model discussed as far back as in Plato's Republic.

Enough examples... point is that this entry is poorly written by people who appear to lack knowledge of the subject matter.

This entry should be flagged for total rewrite. It demeans Wikipedia.

Also, there should be a flag called "Amerocentric" to cite articles for rewrite when they reflect an American rather than encyclopaedic perspective.

Akonga (talk) 21:49, 1 January 2009 (UTC)

Very interesting points, thanks for clarifying this, Akonga. I don't have the feeling that the quality is worse than the majority of other articles I stumble across, but you're right that this should not be the benchmark, but rather write "encyclopedic" articles - which I have no idea how to do right. I have a degree in Business (though a poor one ;)), and simply for now I cannot think of a better way to put things with the resources at hand (though I mainly concentrated on the intro...).

Having said that, why did you put the "revenue" goal back into the introduction, when you argue that the first business models were not based on revenues? Maybe the word "revenue" is the wrong one here...

Thinkstorm (talk) 02:55, 8 April 2009 (UTC)

The "traveling salesman" also came into my mind as the oldest business model. The business word for Utu seems to be Exchange value. Your view on wealth conversion/creation is interesting. But it raises some questions, such as "Where does the traveling salesman fit in?", and "Are wealth and value the same thing?" Although I agree with the need for a flag "Amerocentric", I disagree that this page should have it. The most notable reference (Osterwalder) is from Europe.

Rabiznaz (talk) 09:33, 6 July 2009 (UTC)

Rearrangement

I just rearranged the article, see here. Hereby I moved the "Single reference model"-example Osterwalder is given into the exmple section. This represents just one particular vision on business models, and is not a general intro into all (existing) types of business models. -- Mdd (talk) 00:45, 25 February 2010 (UTC)

Now I changed the title some more to the more general term "business model design template", and made it a separate chapter. -- Mdd (talk) 01:33, 25 February 2010 (UTC)

Environment-Strategy-Structure-Operations Business Model

I have removed the text about the Environment-Strategy-Structure-Operations Business Model, see here for two reasons.

• First, I have found no evidence of it's existence on line.
• And second, there seem to be a copyright issue with the image used. The uploader is not the original creator. In this case a OTRS verification on Wikicommons should be made.

I also think that ESSO business model, or any other model mentioned here, should first have an own Wikipedia article before it is mentioned here. This article wants to give an overview of important items, and not a listing of all new business models. -- Mdd (talk) 00:55, 3 December 2010 (UTC)

Moved part of Business Model Canvas section to the Business Model Canvas article

Yesterday I moved part of the Business Model Canvas section to the Business Model Canvas article, see here

Today, I trimmed this section for a second time, see here. -- Mdd (talk) 23:21, 3 December 2010 (UTC)

Failures and examples

I think the article should be expanded to include more about how, when and why business models fail. The music industry and other industries affected by disruptive technology should probably be outlined. - Shiftchange (talk) 09:04, 8 November 2013 (UTC)

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Manual of style- inaccessible text

A student of mine wikilinked this article and I stepped over to see if he could #wikilink to a section. WP is important. A politician just looks at the first sentence before making policy, a news reader just reads the lead before becoming an expert- and academics just look at the sources. Students actually read each word and typo-- so rather than grizzle- I have made a few changes- but left it at that. Will watchlisters who care please, re-read the WP:LEAD, and then the rest of the MOS, and continue the fight. Students explain here what you fail to understand- and change the bits you are certain about. --ClemRutter (talk) 20:56, 10 May 2017 (UTC)

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Add additional business model for "rent-to-own" or "lease-to-own" business models. Where would Microsofts business model fit in to sell their product, by building up the developer and consultants to support their products. Thus Microsoft and the consultants benefit. What type of business model is it when Microsoft and Apple give free computers to schools so that when they grow up, they recommend that you buy their products? How does marketing strategies fit into the business modelSwgmk (talk) 21:15, 14 April 2018 (UTC)

History

A Google Ngram search shows that the term started to grow fast around 1998. I suggest that the history section focus on describing what happened in the late 1990s. There must be some books or maybe websites that introduced the term. The current section describes a few articles from the 2010s, which are not milestones in the development of the concept - at least not looking at citation data. I also think it would be good to distinguish between the history of the term itself and the history of companies using what today could be called business model — Preceding unsigned comment added by 103.252.202.240 (talk) 08:36, 7 October 2020 (UTC)