A business model is a concept of entrepreneurial activity and describes the benefits and returns of an operation. Digitalization in particular shows numerous opportunities for new business models. I would therefore like to present two studies in the following year and thus somewhat support the current state of play. I have studied these studies in the course of my research.

Study 1: Müller et al. 2016

The first study was carried out by Müller et al. (2016). Based on a survey of more than 60 companies, the authors find that new business models in particular require high investment costs using technology and are therefore rather hesitant to perform. According to the study participants, such investments in digital business models are much more difficult to approve, evaluate, justify than traditional investments and are generally considered riskier.

In addition to costs (50%) the following aspects are mentioned as current obstacles to digital business models:

  • Lack of staff and knowledge (38%),
  • No need (31%) And
  • No support in management (30%).

According to the study, there is often less need to introduce digital business models, especially in SME companies, due to long supply contracts with customers. Other obstacles are legal frameworks such as data protection and often patenting possibilities.

Nevertheless, companies are currently trying to implement such new business models. The objectives of the following are the creation of availability and the individuality of our own services with regard to customers. Special drivers are:

  • Internal ideas (57%),
  • profiling in the market (49%),
  • Subsidies (46%),
  • Partnerships (44%) And
  • Availability of skilled workers (43%).

Study 2: Chamber of Commerce 2019

A further study was carried out by the Chamber of Commerce (2019) in the Stuttgart area. Nearly 300 companies with fewer than 500 employees were surveyed, whose core activity is the production of material or physical products.

According to the participants, the most important objectives of new business models are:

  • development of new products or services (41%),
  • Cost reduction (30%),
  • New distribution channels (26%),
  • Quality improvements (23%) And
  • New business areas (24%).

Excursion: E-commerce as a sales channel

Especially new sales channels are widely used in the current business world. An example is the own online shop to distribute products on the Internet and to enter the e-commerce sector. But what is e-commerce? E-commerce is the English form for e-commerce on the Internet.

Companies often use existing e-commerce solutions for implementation due to a lack of know-how. An e-commerce consultancy or e-commerce agency often helps with this. Often these are from the secret capital of e-commerce Berlin.

The majority does not see core business under threat

In general, more than two thirds of the study participants currently do not see any threat in the core business from digital business models of potential competitors and rate the current existing business model in the traditional market with 80% as the most important source of income. Nevertheless, the use of new business models is to be tested primarily in the company’s traditional market. Only 20% of participants want to test a new business model in new markets. In particular, the technologies will be used in the areas of initiating business, supporting customers and monitoring the quality of services/production (figure).

Areas to be used by technologies to optimize existing business models (own figure according to IHK 2019)

Conclusion

As I said at the end, 2/3 of the participants do not currently see any threat in the core business from digital business models. At the moment, special focus is on the use of the traditional business model under new sales channels such as online shops and new customer support such as chats. Only 20% of participants want to test a new business model in new markets.

Sources

Simon C. Müller, Markus Böhm, Marina Schröer, Alexander Bakhirev, Bogdan-Cristian Baiasu, Prof. Helmut Krcmar, P. I. M. W. (2016). business models in the digital economy. Retrieved May 20, 2020, from https://www.econstor.eu/bitstream/10419/156641/1/StuDIS_2016-13.pdf

IHK-Stuttgart. (2017). Digital business models. Retrieved May 20, 2020, from https://www.isi.fraunhofer.de/content/dam/isi/dokumente/ccp/2017/Lerch_et_al_2017_Digitale_Geschaeftsmodelle.pdf

Image source: https://pixabay.com/de/photos/unternehmer-idee-kompetenz-vision-1340649/

Gender note: I have used the male form for easier reading. If no explicit distinction is made, women, miscellaneous and men as well as people of any origin and nation are always meant. Read more.

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I blog about the impact of digitalization on our working environment. For this purpose, I present content from science in a practical way and show helpful tips from my everyday work. I am a manager in an SME myself and I wrote my doctoral thesis at the University of Erlangen-Nuremberg at the chair of IT Management.

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