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AFTER ONE HUNDRED YEARS OF SOLITUDE: Challenging the Status Quo of the Finnish Trade Magazine Industry by Applying Foresight to Business Models
A Master’s Thesis presentation
Johannes Koponen 2.3.2011johannes.koponen@gmail.com
AGENDA
Trade Magazine Business Models
ScenarioOut of the Frying
Pan
ScenarioTogether We Can
Scenario Rip ’em ApartConclusions
Goal and research problem
Business Models: a theoretical approach
Empirical research process
GOAL
Foresight about futures strategic
business landscape
In fast-moving environments
companies need mission, vision and strategy to keep the
focus
However, vision – where we are going
– is not enough. Companies also
need insight about where everyone else
is going
Everyone else meaning not only competitors but
also all stakeholders that have a say in
shaping the future
RESEARCH PROBLEM
How different media business environment futures are
related to the Finnish trade magazine business model?
BUSINESS MODEL
Reveals the value creation and delivery
logic of a specific company
Is built from choices and the consequences
of these choices, linked by a hypothesis
Loops typically have certain amount of
intrinsic delay
Business models are highly contextual, and
at the same time different business
models might fit to a same situation
Business models are representations that are constructed in a representation of an environment (current
or future)
It is useful if consequences form
self-reinforcing loopsSterman 2000, Picard 1989, Doyle 2002, Casadesus-Masanell ja Ricart 2007; 2009; 2010 and Teece 2010; Giesecke et al. 2010; Fetscherin & Knolmayer 2004; Aaltonen 2010; Itami and Nishino 2009; Wirtz et al. 2010; McGrath 2010)
TRADE MAGAZINE BUSINESS
2) Economies of scale and scope
3) Media company dominates in the value
network
According to sources (esim. Sterman 2000, Picard 1989, Doyle 2002, Casadesus-Masanell ja Ricart 2007; 2009; 2010 and Teece 2010)
And taking into account the nature of
the reference organization
Trade magazine business model: Seven self-reinforcing loops
that create the growth and diminishing of
trade media business
1) Dual market model
1) Dual markets
2) Economies of scale and scope
3) Market powers
STRATEGIC LANDSCAPE
"What does he say?” he asked.
“He’s very sad,” Ursula answered, “because
he thinks that you’re going to die.”
“Tell him,” the colonel said, smiling, “that a
person doesn’t die when he should but when
he can." — Gabriel Garcia Marquez (One Hundred Years
of Solitude)
RESEARCH PROCESS
Topics to Delphi panel from an earlier media
scenario research (Giesecke et al. 2010)
Delphi: 8 person iterative expert
interview with two argument rounds
Based on Delphi opinions, futuribles were constructed
(argument-based single events in the future)
Intrinsic coherence of the futuribles were analyzed with Field Anomaly Relaxation
analysis
Three scenarios were constructed using the
Field Anomaly Relaxation analysis
The functionality of the current business
model was analyzed in each scenario environment
In addition, novel business opportunities were analyzed in each
scenario
Current trade magazine business
model from literature and with discussions
SCENARIO:1) OUT OF THE
FRYING PAN
Delphi panel was worried about the
advertisement revenues
Another fear was that media companies lose
the direct customer relationship
What happens if both threats are realized?
New business opportunity from lack of trust within the
media field:
SCENARIO:2) TOGETHER WE
CAN
Socialization of media was a very important
topic in Delphi interviews
Can inter-expert communities create
enough value to themselves?
Communities challenge the power
within the established media
There are lucrative business opportunities in facilitated
communities
SCENARIO:3) RIP ’EM APART
Digital content is easily tailored.
How could a media company compete
against easily deliverable and
completely personated media service?
Tailoring challenges the economies of scale
It is possible to change the business system so that it supports hyperlocalized
content production
SCENARIO CONCLUSIONS
Fascinated by the discovery, Aureliano, read aloud without skipping the chanted encyclicals that Melquiades himself had made Arcadio listen to and that were in reality the prediction of his execution - - -
— Gabriel Garcia Marquez (One Hundred Years of Solitude)
REMEMBER FROM THIS
PRESENTATION
There are at least three grave threats to trade
magazine business models
(when environment changes, the self-
reinforcing loops turn to vicious circles)
New business opportunities do not seem lucrative in the
beginning
(but it is easier to try and fail now than
have a must succeed situation later)
There are many business opportunities in
professional-specified media markets
(most of them are found from the
outside of the current business field)
Using futures studies methodologies in business
model assertion and innovation is useful
(This research used Delphi and scenarios)
Feel free to ask questions or give feedbackjohannes.koponen@gmail.com
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