The Ultimate Business Model Quiz

Rationale of How an Organization Operates:

• A business model describes how an organization creates, delivers, and captures value.

• Business models are used by managers inside companies to explore possibilities for future development.

• Business models can operate as "recipes" for creative managers.

• The bait and hook business model involves offering a basic product at a very low cost and charging compensatory recurring amounts for refills or associated products or services.

• Business models have become much more sophisticated over the years.

• The rise of outsourcing and globalization has meant that business models must account for strategic sourcing, complex supply chains, and moves to collaborative, relational contracting structures.

• Design logic views the business model as an outcome of creating new organizational structures or changing existing ones to pursue a new opportunity.

• Collaborative business relationships require soft power tactics with the goal of aligning heterogeneous interests.

• Platforms (networked business models) create value by facilitating exchanges between two or more interdependent groups.

• The three elements to a successful platform business model are the toolbox, infrastructure, and magnet.

• The concept of a business model has been incorporated into certain accounting standards.

• Business model design includes the modeling and description of a company's purpose, business process, target customers, offerings, strategies, infrastructure, organizational structures, sourcing, trading practices, and operational processes and policies including culture.Overview of Business Models and Frameworks

• Traditional business model types such as bricks-and-mortar or e-broker describe only one aspect of the business.

• Recent literature focuses on describing a business model as a whole.

• There are various business model types such as subscription-based, freemium, and platform-based.

• Business model frameworks involve internal and external factors.

• Business model design is part of business strategy.

• Business model design and innovation refer to how a firm defines its business logic at the strategic level, while firms implement their business model at the operational level.

• The brand has a symbiotic relationship with the business model.

• The standard terminology and examples of business models do not apply to most nonprofit organizations.

• The model is defined by the organization's vision, mission, and values.

• Business model innovation promises financial returns, but can reduce the person-organization fit.

• Business Model Adaptation (BMA) identifies an update of the current business model to changes derived from the context.