B114 Innovation Management in a Digital and Globalized World Assignment Sample
Introduction
There has been a considerable growth in global energy shortages and environmental deterioration in recent years, which has resulting in an international agreement on the significance of creating renewable energy sources. In tandem with the country’s economic expansion is its increasing demand for energy, resulting in an ever-widening gap between supply and demand in the country’s energy supply. This illustrates the fact that China is making rapid development in the domain of renewable energy generation (Cui,2018).
Renewable energy business in China
The renewable energy market is being propelled forward by a growing awareness among the general public of the need to cut carbon emissions, in addition to government incentives and technology developments. Because of this, the renewable energy sector in China is witnessing significant expansion. According to the China Renewable Energy Development Report (2018), renewable energy capacity in China reached 728.96 GW in 2018, accounting for 38.4 percent of the country’s total installed electrical power capacity. The renewable energy business in China continues to confront enormous challenges, including a lack of technology research and development capabilities, financial issues, as well as high expenses. In the case of renewable energy and industrial competitiveness, for example, these impediments have a negative affect on both (Chen,2021).
Defining conjectures
Solar energy is now universally regarded as a desired renewable energy source that should be researched, expanded, and used in order to fulfil future energy demands. According to the International Renewable Energy Agency, solar photovoltaic (PV) electricity is presently used in over 100 countries, putting it third among renewable energy sources in terms of installed capacity( Konietzko,2021).
Assumptions :
Annual growth rates in solar PV energy generation have averaged 40 percent per year in the world since 2010, according to the International Renewable Energy Agency. Chinese solar photovoltaic industry has undergone significant progress in recent years, establishing itself as an important expanding industry with substantial worldwide competitive advantages.
Conjectures
The business models that support the DSPV industry are growing in pace with the industry’s expansion and development (Turker,2021).
TCS Sustainability Canvas
The United States has established itself as a global leader in the invention of solar-energy-based commercial concepts. Third-party ownership is a notion that evolved as a result of the one-of-a-kind regulatory backing that was supplied. It has proven to be a successful business model since its launch. It is the country’s first business concept, and it is largely used by inhabitants of rural and villa areas who have ample roof space to install DSPV power generators, which are growing increasingly popular (Pizzi,2021).
Value proposition
In view of China’s mounting challenges, such as high upfront prices, long-term financing, and the ever-increasing development of power sales, among other things, it would be interesting to examine and learn from a third-party-owned model in the United States. Chinese industrial and commercial groups who largely utilise the EMC model for DSPV power generation have a disproportionately significant share of the market in China for DSPV power generation.
Revenue stream
There are various advantages to this strategy, including its low transaction costs and improved yields, as well as the fact that it fully employs the knowledge and experience of PV power plant developers. In instance, the Jiaxing Demonstration Zone in Zhejiang Province has put in place an innovative system that integrates “government supervision, market operation, and unified management” into one integrated system (Mathews,2021). Consequently, conventional impediments to the development of DSPV power have been effectively overcome, and other regions have been encouraged to pursue the development of DSPV power while also benefiting from significant insights. This strategy has demonstrated to be beneficial in the past (Turker,2021).
Channels
It is feasible to boost the effectiveness of the promotion of DSPV power by utilising commercial approaches. China’s DSPV industry, according to Chi Fujian and colleagues (Chi Fujian et al. ), is best developed through business model innovation . The DSPV power business model in China is currently in the experimental stage, and it is being put through its paces. It is only after a comprehensive analysis that a more market-oriented company strategy may be identified.
Resources
There have, however, only been a few studies performed on China’s DSPV power business model, which is very new. Chi Fujian and colleagues present three business models for small-scale DSPV power: the self-built and self-used model, the EMC model, and the co-construction model involving end-users and corporations. When it comes to China’s DSPV power, according to Jiang Feng, three models were briefly discussed: the EMC model, the host-owned model, and the leasing model (Wang,2018).
Relationship
The relevance of DSPV power in terms of earning potential was underscored in this study, which tested a number of different operating modes. Bao Yudong offered strategies for China to pursue in order to learn from the successful business model of Solar City, which he based on a thorough examination of the scattered markets in both China and the United States. In many instances, company concepts have just been drawn out rather than being put into reality. As a result of his work on the platform business model, Chen Shuyang is the only person who has developed a concept for DSPV power that is compatible with the platform business model. It was designed with the intention of building an organisation model that would match the needs of the modern Chinese market as part of a business model innovation process.
Critical Discussion
While platform business model innovation is still a theoretical theory with no actual applications, it is growing more widespread. A number of phrases, such as “business model,” “company strategy,” “operation philosophy,” “revenue model, business plan, and economic model” are sometimes used interchangeably with the terms “business plan” when addressing “business models.” For example, “business model” and “company strategy” are phrases that are occasionally used interchangeably with the terms “business plan.” Rather than being a collection of facts, business models are narratives that describe how a company runs, and having an engaging storey is vital to achieving success . Magretta’s claim, on the other hand, appears to be oversimplified in comparison (Van der Waal,2020).
The importance of the logic of a commercial activity or the generation of profit in academic work has long been stressed by academics. Business model allocation (active systems), according to Sayan Chatterjee , displays how firms allocate their activities and investments in accordance with the logic that drives their profits. Business models, he says, are a sort of active system. According to Teece, a business model is a concept or a technique that allows organisations to deliver value to clients while also guiding them to make purchases and consequently earn revenues. As a result, Teece’s managerial notions about what customers want, how to provide those requirements, and how profit may be made are very similar to those of Peter Drucker (Cui, Y.,2020).
Business Canvas model
“A business model defines the reasoning for how an organisation grows, delivers, and obtains value,” according to Osterwalder and Pigneur. “A business model outlines the rationale for how an organisation grows, delivers, and obtains value.” Business models define the logic that guides the generation, delivery, and acquisition of value by an organisation. This final definition has been included in this study since it is a good match for the renewable energy business model, which is why it was chosen. Energy service providers in their local locations have access to a number of market resources, including relationships with local government, customers, communities, financial institutions, and other social resources, such as dealers and celebrities, among others. Local governments have a considerable impact on the growth of DSPV electricity because of their ability to grant significant subsidies, technical help, and public relations campaigns to promote the consumption of DSPV electricity. There are a plethora of strategies for contacting clients in order to capture their desires, lifestyles, and personal preferences, all of which are implemented by local dealers to obtain information about them. (Wang,2018)
Contributors to the establishment and maintenance of a company’s brand image can include members of the community, present consumers, and celebrities from the local community. This is owing to the fact that these clients, among other features, are well-to-do, ecologically conscious, and possess immense political power, among other things. In order to insure the quality of the PV system installation, it is vital to have a significant number of highly qualified technical and human personnel on hand. Companies should also make a systematic effort to improve the public’s opinion of their products and services. The upshot is that other partners are drawn, which results in a succession of benefits for everyone involved (Yao,2021).
Value proposition
Along with the network of contacts it has created with local governments, customers, communities, and financial institutions throughout the course of its history, this model contains a number of additional attractive attributes. The provision of help to third-party firms by local governments might take the form of subsidizations, technical assistance, and assistance with service promotion (Karami,2021). When marketing in residential areas, it is vital to have a solid working relationship with the Residential Owners’ Administrative Committee (ROAC), which aids with marketing activities. Relationships with banks and other financial institutions are vital for the successful implementation of this plan, as third-party firms rely largely on these institutions for financing (Dima,2021).
Key partners
The power purchase agreement mode places the responsibility for ensuring that PV systems are operationally sound and that electricity is consistently and reliably delivered to customers on the shoulders of third-party businesses, who are also responsible for bearing the risk associated with the operation of the system.
Customer
Alternatively, in order to compete with their host-owned competitors, third-party firms must have more technology resources and better-trained staff than they do today. To its credit, China has for the first time constructed a multi-tiered tariff structure that is applicable throughout the country. Because of the high cost of industrial power and the massive demand it produces, enterprises across all industries are under increasing pressure to limit their energy use and defend the environment .
Cost
Good places to work are deemed to be those with excellent utilisation rates and a substantial amount of roof space. Solar photovoltaic (PV) power plants can help to alleviate power shortages and reduce the pressure on electric utility infrastructure and infrastructure by employing renewable energy sources. The efforts of businesses in the industrial and commercial sectors to begin new projects are hampered by three primary impediments.
Revenue
First and foremost, there are big up-front fees as well as a significant time commitment required to get started. Additionally, when establishing PV power plants, collaboration with government agencies, energy organisations, municipal power departments, banks, and design and construction businesses is necessary. As a result of this circumstance, businesses are obliged to contend with a plethora of various inputs. The investment returns related with the construction of a power plant do not show any apparent edges, which is the ultimate result. For commercial and industrial companies, this means that the EMC mode is more practicable than the standard mode.
EMC model
In order for the EMC model to work, it must be assumed that customers have a demand for power and that third parties can meet that demand. Photovoltaic (PV) power plants are relatively simple to construct and operate, and the only thing consumers require is adequate space for the plants to be created and maintained by service providers. In the case of purchases, customers are not liable for the upfront expenditures or operational risks associated with their purchases. In addition, the cost of power is gradually falling, making it more cheap than the present market price. This has a substantial impact on the decrease of electricity bills. After twenty years, the vast majority of photovoltaic (PV) systems can be totally reimbursed to their original customers . Small and medium-sized firms (SMEs) can save money and limit operational costs as a result of the EMC model, which also stimulates the use of clean energy, therefore reducing the amount of energy they consume. Along with cutting consumption and increasing the company’s image, energy conservation and environmental protection are two of the organization’s most essential priorities. It was required to figure out what was wrong with everything during the second stage of the operation. Both technological risk and electric power metres have been recognised as difficulties that are common to all three varieties at this point in time. Prospective subscribers are usually deterred from joining because of the large initial investment required by the host-owned firm. The trouble with TPO is that it takes up too much roof area, which makes it unsuitable for building. The EMC approach is deemed unsuccessful during peak hours thanks to the enormous increase in electricity expenditures that occurs during those hours.
Selling Factors
After then, the distinguishing selling factor was put on display for everyone to observe. The value proposition of a firm explains why a certain business model is preferred to others in a straightforward and obvious manner, as opposed to other business models, by explaining why a given business model is preferable to others. When compared to other business models, the EMC model has a more prominent representation in the company’s value proposition when compared to other business models. Furthermore, because end users are not accountable for the high initial cost, the contract’s duration and variability can endure for up to twenty years, and this value is gained from both flexibility and huge cost reductions, this value is gained from both flexibility and cost reductions.
Challenges and recommendation for innovation business
In the subsequent phase, we focused on delivering particular answers to the challenges that the target client group was encountering at the time of the project. For example, under the EMC model, energy-saving service businesses are responsible for the investment in and installation of solar PV systems, as well as the monitoring and maintenance of the systems. This is accomplished through the use of power metering and energy contracts. Customers may be able to obtain power at a cheaper cost than they would otherwise pay if they purchased it at the retail level if they do so. As a result of paying for energy, you gain a number of additional rewards. In view of the reduced technical risks and capitalization and profitability restrictions the solution presents, it is feasible that clients will be able to take advantage of an increasing number of financial incentives.
Conclusion
The problem of how items are distributed to clients was addressed in the fifth step, which entails exploring ways to make the distribution route more efficient and more successful.
Other business models are less appealing to non-PV enterprises because they do not own channels, which makes the EMC model more appealing. This strategy can be applied to maximise the professional abilities of PV power plant developers, as well as the transaction costs and project revenues.
It was the sixth step in deciding which indications were the most critical to track. The operability and ease of use of the system are crucial at the beginning. Using less sophisticated criteria, such as market coverage and the number of PV power customers, it is possible to track the underlying development of PV power.
References
Chen, Y., Visnjic, I., Parida, V. and Zhang, Z., 2021. On the road to digital servitization–The (dis) continuous interplay between business model and digital technology. International Journal of Operations & Production Management.
Cui, Y., Wang, Y., Bergqvist, J., Yao, H., Xu, Y., Gao, B., Yang, C., Zhang, S., Inganäs, O., Gao, F. and Hou, J., 2019. Wide-gap non-fullerene acceptor enabling high-performance organic photovoltaic cells for indoor applications. Nature Energy, 4(9), pp.768-775.
Cui, Y., Yao, H., Hong, L., Zhang, T., Xu, Y., Xian, K., Gao, B., Qin, J., Zhang, J., Wei, Z. and Hou, J., 2019. Achieving over 15% efficiency in organic photovoltaic cells via copolymer design. Advanced materials, 31(14), p.1808356.
Cui, Y., Yao, H., Zhang, J., Xian, K., Zhang, T., Hong, L., Wang, Y., Xu, Y., Ma, K., An, C. and He, C., 2020. Single‐junction organic photovoltaic cells with approaching 18% efficiency. Advanced Materials, 32(19), p.1908205.
Dima, A., Bugheanu, A.M., Dinulescu, R., Potcovaru, A.M., Stefanescu, C.A. and Marin, I., 2022. Exploring the Research Regarding Frugal Innovation and Business Sustainability through Bibliometric Analysis. Sustainability, 14(3), p.1326.
Hernández-Chea, R., Jain, A., Bocken, N.M. and Gurtoo, A., 2021. The business model in sustainability transitions: A conceptualization. Sustainability, 13(11), p.5763.
Hong, L., Yao, H., Wu, Z., Cui, Y., Zhang, T., Xu, Y., Yu, R., Liao, Q., Gao, B., Xian, K. and Woo, H.Y., 2019. Eco‐compatible solvent‐processed organic photovoltaic cells with over 16% efficiency. Advanced materials, 31(39), p.1903441.
Karami, M. and Madlener, R., 2021. Business model innovation for the energy market: Joint value creation for electricity retailers and their customers. Energy Research & Social Science, 73, p.101878.
Konietzko, J., Bocken, N. and Hultink, E.J., 2020. A tool to analyze, ideate and develop circular innovation ecosystems. Sustainability, 12(1), p.417.
Liu, J., Yao, M. and Shen, L., 2019. Third generation photovoltaic cells based on photonic crystals. Journal of Materials Chemistry C, 7(11), pp.3121-3145.
Mathews, I., Kantareddy, S.N., Buonassisi, T. and Peters, I.M., 2019. Technology and market perspective for indoor photovoltaic cells. Joule, 3(6), pp.1415-1426.
Pizzi, S., Corbo, L. and Caputo, A., 2021. Fintech and SMEs sustainable business models: Reflections and considerations for a circular economy. Journal of Cleaner Production, 281, p.125217.
Turker, D. and Ozmen, Y.S., 2021. How do social entrepreneurs develop technological innovation?. Social Enterprise Journal.
Urbinati, A., Chiaroni, D., Chiesa, V. and Frattini, F., 2019. The role of business model design in the diffusion of innovations: An analysis of a sample of unicorn-tech companies. International Journal of Innovation and Technology Management, 16(01), p.1950011.
Van der Waal, E.C., Van der Windt, H.J. and Van Oost, E.C., 2018. How local energy initiatives develop technological innovations: Growing an actor network. Sustainability, 10(12), p.4577.
Wang, X., Sun, Q., Gao, J., Ma, X., Son, J.H., Jeong, S.Y., Hu, Z., Niu, L., Woo, H.Y., Zhang, J. and Zhang, F., 2021. Ternary organic photovoltaic cells exhibiting 17.59% efficiency with two compatible Y6 derivations as acceptor. Solar Rrl, 5(3), p.2100007.
Wang, Y., Urban, F., Zhou, Y. and Chen, L., 2018. Comparing the technology trajectories of solar PV and solar water heaters in China: using a patent lens. Sustainability, 10(11), p.4166.
Yao, H., Cui, Y., Qian, D., Ponseca Jr, C.S., Honarfar, A., Xu, Y., Xin, J., Chen, Z., Hong, L., Gao, B. and Yu, R., 2019. 14.7% efficiency organic photovoltaic cells enabled by active materials with a large electrostatic potential difference. Journal of the American Chemical Society, 141(19), pp.7743-7750.
………………………………………………………………………………………………………………………..
Know more about UniqueSubmission’s other writing services:
