A Business Model Reference Model


This paper combines business management research with informatics, particularly ontology. A business model reference model (i.e. business model ontology) "is a first step on the way to clarifying what terms and concepts belong into a business model and how they relate to each other." The paper also claims that "modeling the business model of companies, and not only the enterprise model, should contribute to improving interoperability."


Today's businesses recognize the need for robust models to guide their strategies and processes. These models, often influenced by business management research and technical research in informatics, aim to provide a rigorous and precise foundation for business operations. However, a persistent challenge remains the lack of a formal ontology for business models, which limits clarity and reasoning capabilities.

Ambiguities in understanding and interpreting business models can hinder strategic alignment, process engineering, and business comparisons. This challenge stems from the absence of a standard or reference for defining and relating business model concepts. The current business model ontologies lack sufficient rigidity and formality to underpin sophisticated requirement elicitation methods and computer-based tools.

The paper proposes a formalized Business Model Reference Model or Business Model Ontology. This advanced ontology aims to provide clear definitions and relationships for business model concepts, thus eliminating ambiguities. It paves the way for precise and comprehensive business model descriptions, including constraints and rules. Moreover, the adoption of the Web Ontology Language (OWL) paradigm in defining the ontology is discussed, providing a reasoning framework for checking business model consistency and satisfiability. Ultimately, this formalized ontology is envisioned to improve companies' interoperability and contribute to advancements in business strategy alignment, process engineering, and business model comparisons. The paper marks an important step toward synthesizing business management research and informatics, paving the way for more powerful, precision-guided business strategies and processes.

CIOs can leverage the learning from this paper to address various real-world problems:

  1. Business-IT Alignment: The proposed Business Model Reference Model or Business Model Ontology can help bridge the gap between business strategy and IT/IS implementation. By defining business processes and strategies more formally, structured, and logically, IT leaders can better align technology investments and deployments with business objectives.
  2. Improving Interoperability: As organizations increasingly leverage various software systems, platforms, and technologies, ensuring these disparate systems communicate and operate effectively is a significant challenge. The ontology can provide a common language or framework for describing business processes and requirements, improving system interoperability.
  3. Decision-Making Support: A formalized ontology provides the reasoning capabilities to check the consistency and satisfiability of the business model. This can be a powerful tool for CIOs to validate business and IT strategies, evaluate alternatives, and make informed decisions.
  4. Enhancing Business Agility: In today's dynamic business environment, companies must be able to adapt their business models quickly in response to changing market conditions. The proposed ontology allows quicker and more effective adjustments to the business model by providing a clear understanding of the relationships and dependencies among different model elements.
  5. Advancing Digital Transformation: Digital transformation often requires rethinking and redesigning business models. By providing a formal framework for representing business models, the ontology can support CIOs in leading digital transformation initiatives, helping to identify where digital technologies can create new value or transform existing business operations.

In sum, the insights from this paper can assist CIOs in transforming how they understand, communicate, and implement business models in their organizations, enabling a more systematic, logical, and effective approach to leveraging technology in support of business objectives.




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