Techniques for building effective digital business models – Book extract

Extract – Chapter

We have examined many examples across industry sectors of how digital technologies have enabled new digital capabilities for enterprise. These are the building blocks of the digital enterprise, as exciting and new enterprise processes and services created and empowered through selected digital technology convergence.

While many of these illustrate specific industry sectors, the digital capabilities they create are often applicable to many other industry sectors and therefore described as foundational in the shift to digital thinking. Whether this is using crowd sourcing for digital marketing feedback and influencing to establishing new data analytical insight on products and services customization.

In this chapter, we will explore in more detail how digital capabilities may in fact transform not just parts of an organization but change the actual business model of the whole enterprise.

Often we can see and interact with specific technologies that can add or change capabilities but they can also fundamentally alter the operating model of how vertical and horizontal integration works in their markets. In previous chapters, we saw the rise of two-sided and multi-sided marketplaces that form from digital products and services becoming a “platform” to serve many consumers and suppliers concurrently. These powerful network effects amplify the physical world through the digital world by new digital capabilities to create new kinds of business models that have in many industries disrupted competition and the very nature of products and services.

These digital platforms are part of the wider picture of the evolution of enterprise supply chains into new value network ecosystems (VNEs) that represent how new digitally enabled industries and enterprise are created. This world is the connected cars, smart retail, smart city, eHealth, digital wallets, and many others that are the new realities in the connected enterprise of the 21st century.

Techniques for building successful digital workspaces

We will define selected practical cases to explore how digital business models are changing the enterprise model and its markets. Thinking digitally is more than technology solutions; it is how they transform physical spaces, social human connections, and outcomes of enterprise performance and market performance. New advances in data and device screen visualization, machine learning and analytics are creating new computational capabilities that can augment customer experience in exciting and often astonishing ways.

The following sections are aimed at defining examples of building new digital business models drawn from many practitioners’ experiences. We show how digital business models are constructed by transforming physical places, objects, and human relations into new digital spaces that alter spatial and temporal properties of the organization, it’s products and services, and the human experience. Successful enterprises are realising that digital technologies are changing the domains of experience between the products and services and the very meaning of where customer service and social exists in the digital medium.

Digital capability patterns

We will explore lessons learnt in what successful digital workspaces are being built by todays enterprise in selected industry sectors that are forming “digital capability patterns“ that are potential blueprints for business and information technology practitioners.

For each digital business model example we cover a description including

• Type of digital business model and its key capabilities

• The performance outcomes for the enterprise and market that this digital business model may impact

• Types of new digital workspace strategies used to create digital capabilities

Enterprise Architecture Systems models for Digital Practitioners

For each digital business model example we will explore how digital systems thinking is changing the enterprise architecture by demonstrating how connected digital technologies can transform workspaces. In this approach, we will use a general enterprise systems modelling notation methodology Archimate®, an international open standard by The Open Group (1)(2). This specific tool and notation is chosen for it’s vendor and open standards independence. It is used to illustrate practical systems models of digital workspaces. The concepts and strategies of digital patterns and digital workspaces are also independent of specific vendors and standards. The examples in this chapter are lessons learnt in how practitioners have used these concepts applied to digital technologies to build a digital enterprise.

For each digital business model example we cover

• A systems model of the digital capabilities

• Identification of the digital workspaces created from these capabilities

• How digital workspaces build the new digital enterprise

We conclude this chapter by drawing together the various digital business models into a summary catalog of common digital workspaces across all the cases explored. These represent guidance for practitioners seeking examples for building the digital enterprise.

“Building the Digital Enterprise – a guide to the architecture of digital workspaces” Palgrave Macmillan 2015

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