The business models that currently exist are not traditional models, neither the most innovative ones. They are somewhere in between, the evolution from being simple to super complex, from manual to digitized and from being location-centric to become globalized. But, like the traditional business models, the decision making is process oriented and time taking for many still. Organizations have started working on new and innovative business models like data-centric and collaborative to gain new direction in business. Blockchain technology is a driver to innovate new business models, wiping out the existing ones as we know by now.
Here are some statistical facts and insights of blockchain technology –
Impact on Blockchain on Business Models
A business model is a conceptual tool that includes a set of elements and relationships between them to function according to the logic and regulations of a specific organization. The innovation and creation of a business model get driven by the effect of social, financial and technological influences. It is evident that technology firms consistently fail to stay competitive in the market when technological changes happen. The business models can be disrupted by the impact of technological discontinuation. Introduction of the smartphones is the classical example of the technological impact on business models. Nokia had to cope up with huge business losses due to non-adaptability of new business models.
Blockchains, popularly known as the underlying technology of bitcoins, was popularly established in the market as an approach to the payment models where it can provide a mechanism for the trust between the buyer and the seller. Blockchains provides a digital ledger which uses cryptography and hash function to allow the users or participants to conclude on the decision of approving the transaction. The information for each transaction gathers into one single block and each block gets placed one after another to create a sequence or chain.
The impact of the blockchain technology is more than just some updated and modified processes and adding new services or products. Blockchain has the potential to change the entire business model of an organization.
The industry or the business model that is affected majorly till now by the blockchain technology is finance. After an introduction of bitcoins or similar virtual currencies, popularly known as cryptocurrencies like bitcoins, the model for being paid or pay someone has changed a lot. It even has opened the doors to a new business model or business aspects further. Larger payment infrastructure operators like SWIFT has taken a deep interest in the potential of blockchain technology in the payment sector. Now, even big IT enterprises also launching prototypes of blockchain based technology solutions for payments. The business is also considering testing and defining their business models keeping blockchain technology into their mind.
Why are businesses rethinking about blockchains to be implemented?
Even after knowing the huge impact on the complete business models of their organizations, businesses still are considering to get on the tide of the blockchain. Following are the benefits of using blockchains in a business –
1. With the robust and efficient blockchain technology, execution and completion of projects are easier and faster. Therefore organizations are able to take up projects further.
2. The smart contracts help to keep all the stakeholders on one page making them adhere to the rules of business as defined.
3. The transparency and efficiency of the blockchain technology improve collaboration and effectiveness providing security in a business model.
4. Businesses are now considering the private blockchain network to take it up to the new level by creating Blockchain as a service model.
Blockchain Business models and projects
The creation and innovation of a new business model is a continuous process going through extensive tests, knowledge, experience, and processes. Blockchains will not necessarily wipe out the existing models, but it will support them getting easily integrated into them. It depends on how the technology is being leveraged into the current scenario of a business and the potential of it is being used in a provided business case.
Let’s check out the below decision tree to understand this better –
For making blockchain as a game-changing enzyme for the businesses, business models must be identified properly and then utilize the model into a real business is very important. The legacy businesses or organizations have to adopt the technology faster or they may face the swipe out in near future by it.
Financing the businesses or the startups could find the new ways of developing the blockchain technology for their benefit. It may be a time when customers will use some currency like utility tokens as an alternative to traditional equity shares by purchase something. These new things will revolutionize the way businesses function. There are even opportunities to create corporate governance models to make the decision making the process a democratic one.