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Simplified business models > Simplified business models - Pg. 293

Analysis of the Business Model 293 Business delivery and development models Whenever a business is established, it either explicitly or implicitly employs a particular business delivery model that describes the architecture of the value creation, delivery, and capture mechanisms employed by the business enterprise. The essence of a business delivery model is that it defines the manner by which the business delivers value to customers, entices customers to pay for value, and converts those payments to profit: it thus reflects the belief of the organization about what customers want, how they want it, and how the enterprise can organize to best meet those needs, get paid for doing so, and make a profit. The business delivery model is used to describe and classify businesses, but is also used by management inside companies to explore possibilities for future development. Future enhancement of the business delivery model is achieved by implementation of a business development plan. In fact, a well-established business delivery model will act as the basis for creative organizations to develop future strategy. Most organizations recognize that the existing business model will not continue to be successful on an open-ended basis. If business objectives are to be delivered year after year, then the business will need to develop. These developments could include exploring greater sponsorship opportunities, delivering new services and products that will generate new income, and increasing efficiency in the delivery of the exist- ing business model. Development of the business model to fulfil strategic objectives can be considered to be the business development model and it is the main topic of this chapter. In order to place risk management within the context of business operations, it is necessary to consider a simplified business development model. Figure 27.1 sets out the basic elements of a business development model in simple terms. The first stage for an organization is to decide the strategy that it is seeking to deliver. The strategic aims will be determined by considering the mission statement of the organization, the corporate objectives and the stakeholder expectations. The organization should establish a strategy that is capable of delivering the mission statement of the organ- ization. In other words, the strategy of the organization needs to be efficacious. Once the overall strategy is established, the processes that will deliver it need to be identified. For many organizations, the processes that are already in existence will be sufficient. However, if the strategy requires changes to processes or the intro- duction of new processes, then projects or programmes of work will be required. The processes introduced by the organization should be effective in that they are the correct processes to deliver the desired outcomes in the most cost-effective manner. The operations of the organization will need to be efficient in that they deliver the required and anticipated outputs at the lowest cost with the least disruption. The operations of the organization are the day-to-day activities that build into the pro- cesses that deliver the overall strategy for the organization. In relation to operations, the desired state of the organization is the continuity of normal efficient operations with no unplanned disruption.