November 26, 2018

What is the Good Business Model?(II)

  • Business model transaction structure

A good business model, the transaction structure is very important. Generally have the following two characteristics:

Firstly, the enterprise itself is very strong, the focus enterprise has the ability to make sustainable profits; the second is that the stakeholders who cooperate with the enterprise are very strong.

At the same time, innovation in business models will bring two results:

The first is to bring exponential growth. The growth rate will be faster than the old model; The second is the black hole effect. Can attract the stakeholders in the original old model to a new model. For example, when the Didi rises, the former unlicensed taxi driver does not exist and is transformed by the new model. The new model enables the replacement of the old model. The entire connection together will enable an industry upgrade.

Therefore, the business model is to achieve the three aspects of value enhancement, cost saving and growth acceleration by designing the trading structure of the focus enterprises and stakeholders. Everyone has a path when designing a business model. It is good to evaluate a business model. In the process of correction, the actions you modify can increase the value, save costs, and accelerate growth.

A good business model is to achieve the above three directions, not just innovating for the sake of innovation. What we really want to do is to promote the business model innovation of enterprise development and upgrading. In the conversion, generally, it is to achieve the goal of value enhancement, cost saving, and accelerated growth. At the same time, the change of any enterprise is not only the change of its own enterprise, but also the change of a group of partners.

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