BUSINESS MODEL INNOVATIONSUSTAINABILITY

Strategies to Rewire Business

1. Business models & innovation

2. Sustainability

3. Innovation for the Large Firm

4. Case Study

5. What’s Next?

What is a busines model?

1

“the way in which a company makes money.” —Investopedia

“the fundamental structures for how companies create, deliver and capture value.”

—Osterwalder and Pigneur

Many existing business models are predicated on the assumption that vital, non-financial resources are in unlimited supply.

Business model innovation is key to meeting human needs within planetary

limits.

“involving a novel form of exchange at some point along a company’s value chain.”

—SustainAbility

Busines Model Innovation for Sustainability

2

Customers — SunEdison

Supply Chain — SABMiller

Employee — Ocean Spray

Community — 2degrees

Industry — Starbucks

Closed-Loop Production Physical to VirtualProduce on DemandRematerializationBuy One, Give One Cooperative OwnershipInclusive SourcingBuilding a MarketplaceDifferential PricingMicrofinanceMicro-FranchiseCrowdfunding FreemiumInnovative Product FinancingPay for Success

Subscription ModelAlternative MarketplaceBehavior ChangeProduct as a ServiceShared Resource

Business model innovations by company size

SME (-1,000 employees) Large (+1,000 employees)Global Fortune 500

Innovation for the Fortune 500 Firm

3

Any risk manager or foresight strategist that looks five, ten or twenty years into the future will see that many business models that are financially successful today are going to be at risk tomorrow.

— Rising commodity prices

— Changing consumer demographics

— Increasing competitive pressure

— Dwindling security of supply

The Role of Company Culture

• Deflate Hierarchies

• Comfort with Failure

• Collaboration Within and Beyond

• Supportive Leadership

Actions of Internal Innovators

• Act Like an Entrepreneur

• Map Your Model

• Focus on Value

• Mine the Network Effect

• Align Metrics

Case study: Closed-loop aluminum production

4

Largest Global Seller—Rolled Aluminum

External ConditionsResource Scarcity•Price Volatility•Climate Change•Increasing Competition

Company CultureEntrepreneurial Culture•Senior Leadership

Action of Internal InnovatorsInternal & Exernal Collaboration•Align Metrics

Additional Elements at PlayClear Business Case•Time of Transition

Busines Model Innovations for Sustainability

Closed Loop – Main business strategy

Bottom-of-the-Pyramid – Part of supply chain

What’s Next?

5

Model Behavior II: Strategies to Rewire Business

•June 4th

•SustainAbility.com

•@EarthofFoxes