Designing Business Models for the Digital Economy

Digital technologies are increasingly shifting the boundaries between everybody’s lives and information technology urging companies worldwide to address this vital topic. This requires a systematic approach to business model innovations, treating technical and business aspects in an integrated way. Currently one of the difficulties of such an approach is the lack of a common conceptualization to be used by both business and technology experts. The current chapter attempts to remedy this based on the interconnection of nine components of business model representation and five ‘Digital Key Elements’. The elements of the resulting matrix are called ‘Digital Value Drivers’; these describe the effect each digital key element has upon the various business model components. This matrix is transformed into a graphical representation and used in SAP Business Model Development and Implementation (BMDI) method to be then applied in Design Thinking workshops. BMDI is an iterative multi-step method aimed at designing innovative business models. Examples illustrate how the conceptualization is applied and how it enables to proceed from a digital business model design to an implementation in terms of ‘Service Design’; this includes persona development, customer journey map and service blueprint. Through this procedure we have obtained an integrated methodology for the systematic development of digital business models.