Digital Business Framework

Digital technologies enable organizations to develop new digital business models. The digital business model framework helps companies strategize on how to thrive in digital markets.

Key Points

Digital business models can be described in terms of:

Customer knowledge: how well does the company know its end customers?

Business design: how much of the revenues come from controlling the ecosystem versus the whole value chain?

Based on customer knowledge and business design, researchers Peter Weill and Stephanie Woerner propose four business models:

Supplier: A producer who distributes their products through intermediary enterprises.

Omnichannel: An interconnected system that encompasses various channels and products, aimed at delivering diverse and seamless customer experiences to cater to specific life events.

Modular producer: A supplier that offers easily integrable and ready$-$to$-$use products or services, particularly with reference to digital solutions $($e$.$g$.,$ PayPal, Stripe$).$

Ecosystem driver: A catalyst that organizes an ecosystem$$a collaborative network of enterprises, devices, and customers$$to generate value for all involved parties. This entity serves as the primary destination within a specific domain $($e$.$g$.,$ shopping$)$ and ensures excellent customer service by including complementary, and at times, competing products $($e$.$g$.,$ Amazon Marketplace$).$

Learning Goal: Applying the Digital Business Model Framework

Instructions: Select two digital business models from the four options provided in the Digital Business Model Framework$$i$.$e$.,$ supplier, modular producer, value chain, and ecosystem. After selecting the models, you need to choose two real companies that exemplify the implementation of those chosen models. In your justification, explain why you categorized each company based on the two dimensions used in the Digital Business Model Framework, which are the knowledge of customers $($complete or partial$)$ and the type of business design $($value chain or ecosystem$).$

use this template below

Company $1$ Name: $...$

Business Model: $...$

Knowledge of end customer: $[$Explain why knowledge of end$-$customer is limited or extensive$]$

Business Design: $[$Explain why revenues mostly come from value chain or ecosystem$]$

Company $2$ Name: $...$

Business Model: $...$

Knowledge of end customer: $[$Explain why knowledge of end$-$customer is limited or extensive$]$

Business Design: $[$Explain why revenues mostly come from value chain or ecosystem$]$