Chapter 5 reviews different business models. For this assignment, think about the companies you interact with or have read about. Which one do you believe has the most interesting business model?
- Post a description of the model. (Include a URL if appropriate, but fellow students should understand the model from your description.)
- Then, read through the examples provided by your fellow classmates.
- Choose the example you believe is the most innovative. Post a comment to it which explains why.
- Choose the example you believe is the most likely to succeed. Post a comment to it which explains why.
Read MiniCase #5 — Business Model Innovation: How Dollar Shave Club Disrupted Gillette — on pages 487-488 in the textbook.
Provide answers to the following questions:
1. Why was Gillette initially able to create a competitive advantage and sustain it for so long?
2. What led to the opportunity for start-ups like Dollar Shave to enter into this market? What capabilities did they bring that Gillette did not have?
3. Do you think additional online startups will continue to steal market share from Gillette? Explain your answer.
Watch the video for this week on the Star Model which identifies five dimensions to an organization that may need to change when implementing a strategy. After viewing the video, return to the MiniCase on Dollar Shave Club and Gillette. The success of Dollar Shave Club led Gillette to introduce its own subscription-based service (Gillette Shave Club). This is clearly an example of a change for Gillette in one of the five dimensions of the Star Model (i.e., Strategy).
As part of this new strategy, though, we would expect to see additional changes in some of the other dimensions. Although the case does not discuss this, please speculate on the type of changes you believe Gillette should have made, relative to its retail business, on the following two dimensions in order to implement the subscription service strategy:
1. People skills
That is, what new employee skills are needed to implement a subscription service business model and how should the individuals be rewarded to increase the chances of success?