Curated from the original article by Robin Good:
(access requires free registration)
"Systematically exploring alternative approaches to value creation can allow companies to find new opportunities for growth.
[recently a new approach to business growth] has emerged, one that we might label “business model experimentation”: the pursuit of growth through the methodical examination of alternative business models.
At its heart, business model experimentation is a means to explore alternative value creation approaches quickly, inexpensively and, to the extent possible, through “thought experiments.”
The process sheds new light on potential competitors and lowers the risk of taking the wrong or a lesser-potential road — all for an initial investment that is typically quite small relative to what can be gained."
"...[the goal of this report] is to demonstrate how an organization’s ability to methodically and routinely examine multiple business model alternatives — in other words, by treating the business model as a variable and not a constant — can serve as a critical enabler of growth, allowing executives to anticipate, adjust to and capitalize on new technologies or customer insights."
"By engaging in business model experimentation with a small, focused team, companies can accomplish three important goals.
First, they can understand the implications of different business models and make clearer, better informed decisions about where and how they want to compete.
Second, they can identify the business models that will create the most value for customers and themselves and appropriately leverage their existing resources.
And third, they can use business model innovation to extract the maximum potential from other growth-focused activities — their technical R&D, customer insight and strategic development efforts.
Given the high potential of business model innovation and how few companies have mastered it, we see business model experimentation as a potent source of competitive advantage."
Read the full original article here: http://sloanreview.mit.edu/the-magazine/2012-winter/53214/how-to-identify-new-business-models/ (requires free registration)