Identifying Business Models
An essential element for the development of a business plan is choosing and assessing business model(s) for the DIH. In essence, the business model represents the core aspects of the business and shows how an organization will make money and sustain its profit stream over time. Following a discussion among the consortium partners and stakeholders, the final conclusions on the business models are included in the business plan.
Why develop a business model?
Business models are core to the organizational activities of a DIH and present the starting point for market assessment and the organization of sales and marketing, as well as setting up the governance of the hub. As the business models describe how an entity will generate revenues, they are also key for investors to provide funding. Therefore, business models are also crucial for the investment plan of DIHs.
One or multiple business models?
There can either be different business models or one business model, with several sub-business models. These sub-business models have each different value propositions, with different users, different market segments and different revenue streams. All players in the field have to be identified in order to choose the most suitable business model.
How to develop business model?
The different business models and underlying activities can be presented in a number of ways. An example is the Business Model Canvas (Osterwalder, A., and Y. Pigneur , 2013) which provides a template for developing business models.
The canvas method is a commonly used approach to describe the organization for the business model. The method uses a visual chart to describe a product’s value proposition, infrastructure, customers, and finances, thus covering the essential elements of a business model. The method also assists in aligning activities by illustrating potential trade-offs.