Forschungsarbeit, 2011
28 Seiten, Note: none
1. Introduction
2. Literature Review
3. Basic Approach:
4. The model in detail
5. Implications to Industry
6. Value to business
This paper aims to bridge the gap for organizational decision-makers by providing a practical, visual model that integrates multiple business variables into a single, cohesive strategic output. It addresses the challenge of connecting disparate business factors to improve decision-making accuracy and reduce the risk of failure in innovation and strategic planning.
4. The model in detail
There are several factors that contribute to the margin of a product. Innovation, differentiation and perceived value by consumers can influence, among other factors, the margin that a product can provide to a business. The perceived value by the consumers must be the primary factor to be understood in order to create a profitable business.
According to the “EN 11325-1:1996 Value Management, Value Analysis, Functional Analysis vocabulary – Part 1: Value Analysis and Functional Analysis” standard the definition of “value” is “the relation between the contribution of the function to the satisfaction of the need and the cost of the function”. The standard also indicates that value is not absolute but relative, being perceived differently by the different stakeholders. Choosing from two equivalent products, it is assumed that the consumer values more the one that provides better satisfaction of the existing needs, even if he or she has to spend some extra resources, that being some extra cost. It is based on this assumption that the model is constructed, as on figure 5. The matrix evaluates two variables, the functionality use or given to the product by the consumer and the price accepted or paid (imposed to) by the consumer. “Value” increases from the left bottom corner to the right top corner of the matrix.
1. Introduction: Discusses the historical reliance on visual models in business and the need for a simplified, operational approach to strategic decision-making.
2. Literature Review: Provides an overview of existing strategic and innovation concepts, identifying the gap in current models regarding multi-variable alignment.
3. Basic Approach:: Introduces the MAP (Moving along Alignments and Paradoxes) model and defines the fundamental variables that impact business strategy.
4. The model in detail: Explains the core matrices for assessing product value, effort, potential market, and profit, detailing how these elements combine.
5. Implications to Industry: Explores how the proposed models can be applied to real-world business scenarios to manage strategic equilibrium and paradoxical situations.
6. Value to business: Concludes by summarizing the importance of the developed model in linking innovation, value creation, and strategic planning.
Dynamic models, strategy, innovation, decision-making, value creation, product margin, market potential, competitive advantage, functional analysis, strategic equilibrium, organizational effort, differentiation, multi-variable modeling, business planning, consumer needs.
The paper aims to provide decision-makers with a practical, visual tool that simplifies complex business data into clear, actionable strategic outputs by integrating multiple variables into a single cohesive model.
The key themes include the relationship between product value and innovation, the alignment of organizational efforts with market demands, and the development of strategies for sustainable versus disruptive innovation.
The goal is to solve the current lack of capacity in existing models to connect multiple, distinctive variables, thereby helping managers make better-informed, less risky decisions.
The author uses a construct-based modeling approach, creating a series of interrelated 2x2 matrices that reduce multi-dimensional business factors into single-point strategic indicators.
The main sections detail the MAP (Moving along Alignments and Paradoxes) model, the VBI (Value Based Innovation) model, and their applications in analyzing market potential, margin, and strategy.
The work is best characterized by innovation models, strategic decision-making, value analysis, and multi-variable alignment.
The model defines "turning-around" innovation as a method to create alternative products that replace existing ones by offering basic functionalities at significantly lower prices, mirroring Christensen's concept of disruptive innovation.
A "paradox" strategy is recommended when changing market forces are extremely strong and unpredictable, requiring rapid strategic adjustments that may deviate from long-term alignment.
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