Executive Guide: Business Models for Shared Value

Executive Guide: Business Models for Shared Value

Shared value seems promising, but many managers struggle to make it happen. This executive guide provides a new approach by focusing on business models.
nbssouthafrica November 28, 2016

Tools for the Private Sector to Create Shared Value

Executive Guide
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Shared value is the idea that by addressing society’s needs and challenges, companies can create economic value in a way that also benefits society. Shared value seems promising, but many managers struggle to make it happen.
This executive guide provides a new approach to pursuing shared value by focusing on business models. Prepared by researchers Lorenzo Massa, Florian Lüdeke-Freund, and Nancy Bocken, the guide draws on a systematic review of research and practice, gleaning insights from more than 180 articles and interviews with leaders and managers.

Three Tools for Business Model Design

The guide provides three tools to support managers and entrepreneurs in the design of business models.

The Hourglass Model

The Hourglass Model guides managers and entrepreneurs on how to analyze the total value created. They can use it to map how their current business model creates, destroys, and/or misses value opportunities. When managers and entrepreneurs see this, they can more readily identify opportunities to increase shared value.
The Hourglass Model looks beyond the traditional focus on firm and finance, encouraging consideration of value creation across the business system. This “total value creation” perspective recognizes that any business (model) depends on diverse stakeholders that provide diverse forms of capital, such as investors providing financial capital, the environment providing natural capital, and employees providing intellectual and human capital. 

The Sustainability Strategy Roadmap

The Sustainability Strategy Roadmap (SSR) helps managers and entrepreneurs plan their sustainability strategy more formally. It can be used to set a focused strategy for shared value creation. The SSR can be used for any type of innovation related to shared value: product, process, organization, or business model innovation. 
Use the SSR to clarify your company’s expectations for shared value, develop a blueprint for their achievement, and prioritize initiatives to mitigate risk and increase chances of success.

The Business Model Thinking Framework

The Business Model Thinking framework helps managers and entrepreneurs generate and validate new business models. Companies match opportunities in their portfolio to appropriate innovations.
Only some strategic opportunities are likely to require innovating a business model. For those that do, managers need to understand the peculiar aspects of innovating a business model, as opposed to innovating products or processes. The Business Model Thinking (BMT) framework helps managers do that.

New Models for the Private Sector to Create Shared Value

By innovating business models – the fundamental way a company creates, delivers and captures value – the private sector can use its innovative capabilities to develop solutions that profitably address social and environmental issues. This report offers tools to help managers and entrepreneurs rethink value creation and align it with strategy. This perspective could help advance progress toward visionary business models that create shared value. 
Executive Guide
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Related Resources

Systematic Review

Tap the joint potential of business models and shared value creation creation.

NBS-SA
Primer

This primer introduces business models, shared value creation, and outlines how managers and entrepreneurs can link the two to foster prosperity. 

Florian Lüdeke-Freund
Lorenzo Massa
Reports and Articles

Four-fifths of CEOs are experimenting with alternative business models or thinking of doing so. 

Reports and Articles

“What is a business model?” is a popular opener in business publications. NBS interviews Florian Lüdeke-Freund to learn more.

Kristy Faccer
Reports and Articles

This report identifies eight key challenges facing South African managers and opportunities for researchers to contribute implementable guidance.

NBS
News and Events

NBS South Africa invites proposals for research on business model innovation to be completed in 2015. 

NBS