{"id":22567,"date":"2023-04-26T16:25:56","date_gmt":"2023-04-26T10:55:56","guid":{"rendered":"https:\/\/gstguntur.com\/?p=22567"},"modified":"2023-04-26T16:28:08","modified_gmt":"2023-04-26T10:58:08","slug":"introduction-to-business-modelling-cs-professional-study-material","status":"publish","type":"post","link":"https:\/\/gstguntur.com\/introduction-to-business-modelling-cs-professional-study-material\/","title":{"rendered":"Introduction to Business Modelling – CS Professional Study Material"},"content":{"rendered":"

Chapter 13 Introduction to Business Modelling – CS Professional Valuations and Business Modelling Study Material<\/a>\u00a0is designed strictly as per the latest syllabus and exam pattern.<\/p>\n

Introduction to Business Modelling – CS Professional Valuations and Business Modelling Study Material<\/h2>\n

Question 1.
\n(a) \u2018Business Model defines how a Company provide value to customer and transfer payments to profits\u2019. Elucidate the above statement by highlighting the key components of a business model. (June 2019) (5 marks)
\n(b) Sandeep, an IT graduate, has developed an e-platform to assist farmers to sell their produce directly to the bulk customers in the nearby cities, was unsure of selecting a suitable business model and has approached you to suggest one. As a Business Model consultant, select a suitable business model to Sandeep for his e-platform Application, and explain its features, advantages and drawbacks. (5 marks)
\nAnswer:
\n(a) A business model embodies nothing less than the organizational and financial \u2018architecture\u2019 of a business. It is not a spread sheet or computer model, although a business model might well become embedded in a business plan and in income statements and cash flow projections. But, clearly, the notion refers in the first instance to a conceptual, rather than a financial model of a business.<\/p>\n

It makes implicit assumptions about customers, the behaviour of revenues and costs, the changing nature of user needs, and likely competitor responses. It outlines the business logic required to earn a profit (if one is available to be earned) and, once adopted, defines (he way the enterprise \u2018goes to market\u2019. But it is not quite the same as a strategy. The following key components must be considered while developing a business model:<\/p>\n

(i) High-level vision: The Vision describes the business model in brief.
\n(ii) Key objectives: The top goals and the plan to measure them.<\/p>\n

(iii) Customer targets and challenges: The types of customers along with their exact pain points. Targeting a wide audience won\u2019t allow business to hone in on customers who truly need and want product or service. Instead, when creating business model, narrow audience down to two or three detailed buyer personas. Outline each persona\u2019s demographics, common challenges and the solutions the business model will offer.<\/p>\n

(iv) Solution: The primary way that the business model solves customer\u2019s problems. Solution could be a product, service, technology etc.<\/p>\n

\"Introduction<\/p>\n

(v) Value: The core elements of the solution that make it unique and differentiated is value being offered to the customers. How will your company stand out among the competitors? Do you provide an innovative service, revolutionary product or a new twist on an old favourite? Establishing exactly what your business offers and why it\u2019s better than competitors is the beginning of a strong value proposition. Once you have got a few value propositions defined, link each one to a service or product delivery system to determine how you will remain valuable to customers over time.<\/p>\n

(vi) Pricing: How you will package your solution and what it will cost.<\/p>\n

(vii) Messaging: A clear and compelling message that explains why your solution is worth buying.<\/p>\n

(viii) Go-to-Market: The Channels that use to market and sell to customers. No business can function properly (let alone reach established goals) without key partners that contribute to the business\u2019s ability to serve customers. When creating a business model, select key partners, like suppliers, strategic alliances or advertising partners.<\/p>\n

Unless you\u2019re taking a radical approach to launching your company, you\u2019ll need a strategy that builds interest in your business, generates leads and is designed to close sales. How will customers find you? More importantly, what should they do once they become aware of your brand? Developing a demand generation strategy creates a blueprint of the customer\u2019s journey while documenting the key motivators for taking action.<\/p>\n

(ix) Investment required : The costs required to make the solution a success.<\/p>\n

(x) Growth opportunity : The ways that you will growth the business, including key partnership if you need them. It is important to leave room for future innovations. Review initial plan often and implement changes as needed.<\/p>\n

\"Introduction<\/p>\n

(b) Suitable Business Model: Become a Marketplaces is the right business model for Sandeep.<\/p>\n

Features of the Market Place Model: Marketplace model means providing of an information technology platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller.<\/p>\n

The main feature of the market place model is that the firm will be providing a platform for customers to interact with a selected number of sellers. When an individual is purchasing a product from the firm, he will be actually buying it from a registered seller. The product is not directly sold by the firm. Firm is just a website platform where a consumer meets a seller. Inventory, stock management, logistics etc are not supposed to be actively done by the firm.<\/p>\n

Advantages
\nThere are several advantages of using this form of business model. In this model the supply and demand would be brought together. Second, one of the greatest benefits is having Zero to little overhead, and no inventory. You can get a swanky office space if you want, or you can run the company virtually.<\/p>\n

When you manufacture a product, you take on a lot more risk and pressure to make sure that inventory is sold. When you are the marketplace, instead of worrying about manufacturing costs, you are simply bringing the sellers to buyers (and Vice versa) and facilitating a transaction, taking a small slice of the pie from each transaction. You give sellers a place to make a profit and reach consumers, while customers are happy to find exactly what they want, usually at a discounted price.<\/p>\n

Disadvantages
\nThe Becomes a marketplace is not a bed of roses. There also are some drawbacks:<\/p>\n