New Summary Available for The Risk-Driven Business Model

Sept. 19, 2014 - PRLog -- When business leaders think about game-changing innovation, all too often they focus their attention on coming up with new products and services or modifications to existing ones. In a commoditized and disruptive marketplace, competitive differentiation through this type of innovation is becoming increasingly more difficult, costly, and risky. This risk can make or break a business. What leaders should be looking at instead is how to leverage existing products, technologies, and markets to gain a competitive advantage. In The Risk-Driven Business Model, authors and innovation experts Karan Girotra and Serguei Netessine show how assessing and addressing risk and then making small “tweaks” to existing business models can minimize risk and maximize returns. This is the essence of risk-driven business model innovation (BMI).

According to the authors:

*Business model innovation (BMI) can be a relatively easy, inexpensive, and profitable way to gain a competitive edge without making significant resource investments. Any company can innovate by adjusting the "what, when, who, and why" of its business model.

*BMI is driven by addressing and managing risk. All business models are primarily subject to two types of risk: information risk and incentive-alignment risk. By taking steps to identify and manage these risks within their business models, businesses can improve efficiency and increase returns.

*Every business model should be assessed for common "risk warning signs" that point to inefficiencies. Once inefficiencies and their associated risks are identified, steps can be taken to mitigate those risks.

*Any business can benefit from business model redesign. By assessing the existing business model against the Business Model Innovation Matrixin a programmatic way, almost any business will find areas for improving efficiency and reducing risk. Taking one or more of the 12 prescribed actions will result in improved performance.

*BMI is the wave of the future. Companies are increasingly recognizing that adapting to a changing and disruptive market environment requires innovation in business models, as well as in products and services. It is likely that BMI will become even more of a focus in the future.

*Innovation ideas are everywhere. Savvy leaders recognize there are great ideas both inside and outside their organizations, and are creating opportunities to leverage that knowledge. Crowdsourcing and other open innovation practices are becoming common components in the innovation process.

To learn more, please visit http://www.bizsum.com/summaries/risk-driven-business-model