Custom «Business Models, Theories and Techniques» Essay Paper Sample

Business Models, Theories and Techniques

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The objective of this paper is to determine whether there is any relationship between Business models, theories and techniques. In addition the paper will extrapolate the practical benefits and the application of such models in the business arena. To achieve these objectives, random data was collected and case study examples established just how far the models and theories were incorporated in the business techniques utilised by the Coca Cola and the Pepsi companies in their fight for customer base in Asia. 

The objectives were realised to a large extent with the agreement that theories and models influence to a great extent the techniques adopted especially in the field of Human resources, operations and the business environment. The business models provide tools for analysis of the market trends.  The theories provide guidelines for effective management. In addition, the theories influence the government decision making as well as shape the business orientation towards the market whilst keeping an eye on the welfare of the employees, who are a very vital component of the business venture.

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Practical application of the models and tools of analysis provides the business with time tested ways to gauge the business prospects as well as establish the viability of their venture. To compound this, the business models provide well worked out concepts which ensure vital information is gathered, fostering informed decisions which foster a firm future and timely intervention in case of a crisis.


Business models inform the rational of how an organization strives to create, deliver and capture the socio-economic value vested in its business venture. Business models are molded by the organization in line with the services rendered, the organizational structures and the organizational objectives. In addition, the business models encompass an appreciation of the internal and external forces within which the organization operates in. Business models are formulated in the confines of the varied business theories relevant to the business establishment. In addition, the broad range of informal and formal descriptions which elaborate the core aspects of business; its purpose, offerings strategies, infrastructure, organizational structures, trading practices, and operational processes and practices are enshrined in the tools and techniques adopted by the business outfit (Zott, 2008).

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Business models give a perfect image of the business through the lenses of its value creation and client retention as well as the possibilities for further expansion. The motivation of these business ventures have to highlight the appreciation of the varied theories, how to incorporate them into their system and ensure they deliver to the advantage of the organization as well as precipitate the right business techniques or tools of operation. Ultimately, the organization strive to use the management and the client base to develop a strong sense of mutual attachment by ensuring that customers get value for their money whilst the business venture stays afloat and flourishes due to the profit margins it is gaining.  

In spite of the diversity of business models from the theories and the tools and techniques applied in business, there is a relationship between them all. Indeed, the business environment, human resource strategies and the entire organizational operations are dictated by the models, shaped with respect to the theories and effected through the most reliable and efficient technique or their dispensation directed by the tools relative to the intended outcome. Whenever any of these concepts (business models, theories and techniques) are adopted by the organization, they impact on the organization's staff, management as well as clients. The three also act as a statement of intent, either for prosperity or for the demise organization depending on which angle they are adopted into the organization.

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In respect to the above observation, this paper seeks to determine whether the business techniques adopted by a business venture extrapolate a relationship that vindicates their adoption to observance of business models and theories. In addition, this paper will examine whether human resources practices influence the techniques effected by the business enterprise and whether they have an influence in the eventual profit margins of the enterprise (Porter, 2008). The uses of case study discussions form the bulk of data and evidences that inform the final conclusions. This paper also seeks to determine the relationship between theories, business models and, business techniques. The business models used include the Porters five-force model and the human resources model. These are juxtaposed with the Marslow's and contingency theory and examined in relation to human resource practices, the business environment and the business operations. Job rotation and Pestle and SWOT analysis are the tools and techniques which our examination will centre on.

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The Maslow's management theory focuses on the Human resource sector of the business. Also, referred to as the enlightened theory, it encompasses aspects that seek to explain the perceptions held by business managers towards their employees. Based on Maslow's hierarchy of needs, the theory recognizes the need to have motivated work force through meeting their psychological, safety, social, ego and self-actualization needs. By ensuring the base needs are met, the focus of the employee shifts to the higher levels which could be pursuing status, recognition and excellence or ensuring self-fulfillment. Through this theory, employees can have better focus and improved performance. In addition, they espouse responsibility over allotted tasks and ensure they dictate the project outcomes, most a times steering them to the better. The employees have a more positive attitude towards the job whilst they remain loyal, highly motivated and always engaged.

On the other hand, the contingency theory postulates that the leader's leadership abilities are vested on his preferred style, capabilities and behaviors of followers and also the business environment. They contents that there is no one best way of leadership and diverse ways could succeed in certain businesses and fail miserably.  The theory appreciates the likelihood of success in certain business environment for a management whilst the same tactics could miserably fail when applied elsewhere (Lambert, 2005). The management (also referred to as the leadership for the purposes of this paper) always have a difficult balancing act in juggling the demands of the business and maintaining a highly motivated work force. The choice of the two theories is thus informed by a management point of view, where decisions have to be spot on; profits have to surpass the expected standards whilst the staffs have to remain highly motivated to boost their productivity. By offering choice in the preferred management style, the quality and performance have to be ensured and thus the two theories coincide. The work of the management is thus narrowed in relation to developing and adopting the best business model that will lead to the realization of the organizational goals.

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The management has to juggle between developing, maintaining and ensuring performance based on the best business model while showing appreciation of the employees welfare. For purposes of ensuring as highly motivated staff, the operations in the business have to be mirrored through the Porters five forces model whilst employee motivation are kept at a high through the Human Resources capability model (Schafer, 2005). Essentially, this work is reserved for the management, who allocate the staff the duties to tend to based on their abilities. Intertwined in the confines of this human resources capability model are the postulations of the Maslow's business theory which will work towards realizing a fully productive workforce. In addition, recognition of the employee's capabilities informs role they can best play and thus ensures the manager and the employees are satisfied, comfortable and can perform to their highest level. Thus, the contingency theory comes into play for the manager will not only need to be flexible, but he will need to be open-minded and accommodating to the ideas of other persons (Porter, 2008). In addition he will be able to appreciate the diversity in skills, experience, capability and motivation as well as productivity.

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The business venture ought to appreciate the outside and inside forces that can have significant effects on the business. To this end, the Porters five Forces Model comes in handy. The work of the management is enshrined in sound decision making that envision the present and predict the future. The management of any business outfit uses this model to establish possible competing forces to assure the business of security and prosperity. These competitive forces include the entry of competitors, the threat posed by substitutes, the influence or bargaining powers of the clientele, the rivalry amongst existing industry players, i.e. how tough is the competition and normally a sixth that is added is the government (Afuah, 2003). This model informs whether an investment is valid and offers a foundation for the management to set their decisions.  This model appreciates the essence of competition in business and states the importance of sustained industry profitability. To maintain an edge over other businesses, the model has to be effectively executed, thus determining all the forces from without or within which could form the base for the success of the business or lead to its down fall. The point being emphasized here is that the forces could be operating from within or without the organization.

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Businesses need to develop effective service delivery and as well retain their employees lest they join its rivals. Strategies in paper need to be realized on the ground and thus the employees, competitors, customers as well as the shareholders will want to have the management adopt the best possible technique and utilize the best tools for optimal results. To establish the Porters Five Forces model, the PESTLE (Political, Educational, Social, Technological, Legal and Environmental) tool as well as the SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis comes in handy (Zott, 2008). For employee retention, the use of the Human Resource Capability model will dictate employee rotation. In such a case, the employee will not only be accorded the chance to experience the operations of the designated area first hand, but also be gauged to determine his or her suitability to that designation. This provides the management with reliable information on who works best where as well as determining how best to have the personnel deliver to the desired standards. Job rotation also brings out new dimensions of doing things as well s avoiding regurgitation of ideas, skill and competencies. The ultimate goal of the organization should all along remain the high motivation levels of the employees, sound decision making fostering security as well as longevity and desired profit margins.

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Theories, models and techniques are directly related especially in the business arena. In the perceptions of the management, the laying of strategy depends on the business model, which observes the related theory. The business strategy and guidelines for their execution are realized through the techniques (Porter, 2008). The tools of analysis inform the management of the trends in the market as well as the internal weaknesses or strengths which could propel the business to success. Taking the example of the Multinational soft drink vendor Coca cola, exploration will be done on how these factors relate.

Coca cola has for stood out as the unrivalled vendor of soft drinks. However, the rise of Pepsi should worry the management due to the competition Pepsi is likely to offer in the market. Pepsi seems rejuvenated as well as ready to push Coca cola to the limit. Cognizant of the threat of Pepsi, Coca cola develop a plan aimed at ensuring that none of the members of their workforce renege to Pepsi. This is done through the use of the Maslow's management theory and supported by the human resources capability model. To achieve this, job rotation is one of the strategies aimed at ensuring job satisfaction to the employees of Coca Cola. The management seems to be wary of the threats of Pepsi and seem to appreciate the sizeable amount of clientele they stand to lose if Pepsi gains on them.











On the other hand, Pepsi has to strategize excellently. The need to analyze the forces that have supported Coca cola thus far and probably find means of countering them or finding an alternative. This would probably call for the use of the Porters five forces model. On the theories, the manner of management will need to be flexible enough because this is the time the ideas of the employees are termed as valuable. In addition they will require highly enthusiastic and motivated employees and thus will need to apply both the Maslow's and the contingency theories in their systems. Though Pepsi will now be the new members in the industry, a SWOT and PESTLE analysis will help them fined means to out manouvre Coca Cola. They also will need to use the Porters five forces model.

Thus, the use of the tools and the theories reflects a direct relationship between most of business ventures with deviations regarding the area directed. The Human resource area will require a specific theory which could surprisingly define the organizations status in the business environment whilst at the same time the functioning of the human resource dictating the operations of the organization. Commendable though is the scope of analytic and operational conceptualization framework theories, models and techniques offer to the business (Shafer, 2005). However, the business environment, which is characterized by high level rivalry, low levels of product differentiation, strict strategic planning and execution and the consumer stereotypes, does not offer the best avenue for analysis. The flawed utility of the theories, models and techniques can be attributed to the complexity of business, because it does include consumers, producers and market chains distributors. Thus, at no time will the three concepts be followed to the letter.

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With focus on the human resources, operations and business environment aspect of the business, theories and models influence the techniques adopted by most business ventures. The technique might be geared towards achieving a certain goal; say like meeting certain levels of profits, but the strategy, which is dictated by the business model and theory ensures that the technique does succeed. In addition, business models provide tools for analysis of the market trends as well as the strong points of the organization. This would be vital in establishing the viability of the market venture and also informs of the level of intelligent strategies adopted. This ensures that the management makes visionary decisions, decisions not confined to the current market turnover, but one that appreciates future trends in the market segmentation and more so their area of operation.

Even though businesses might have the techniques and the staff, they do not operate in a vacuum. The business model is designed to contain avid appreciation of the business demographics such social, political, educational, environmental, technological and legal aspects of the business. This informs the management of the prevailing economic trends, any chances of inflation and even potent opportunities to be exploited. It firmly clears the possibility of operating blindly while giving precedence to the management of achievable results and setting of valid targets (Lambert, 2005). In addition, theoretical orientation develops a business conscious of the importance of the workforce as part of the organization rather than as a means to an end.

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Practical application of the models and tools of analysis provides the business with time tested ways to gauge the business prospects as well as establish the viability of their venture. To compound this, the business models provide well worked out concepts which ensure vital information is gathered, fostering informed decisions which foster a firm future and timely intervention in case of a crisis.

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