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Question 31 - P_SAPEA_2023 discussion

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Green Elk & Company is the world's leading manufacturer of agricultural and forestry machinery. The former company slogan 'Elk always runs' has recently been changed to 'Elk feeds the world'. One of Green Elk's strategic goals is to increase its revenue in the emerging markets of China, India, and other parts of Asia by 80 % within three years. This requires a new business model that caters to significantly smaller farms with limited budgets. You are the Chief Enterprise Architect and the CIO asks you to assess the now business model for smaller farms with smaller budgets. By applying the Sustainable Business Model Canvas, which sequence of steps is best practice?

A.

1. Assess and define the cost structure and revenue streams/2 Define the customer segments and value propositions/3. Detail the customer relationships and channels/4. Identify relevant key activities key resources, and partners/5. Define the eco-social benefits and costs.

Answers
A.

1. Assess and define the cost structure and revenue streams/2 Define the customer segments and value propositions/3. Detail the customer relationships and channels/4. Identify relevant key activities key resources, and partners/5. Define the eco-social benefits and costs.

B.

1. Assess and define the key resources, key activities, and partners/2 Define the customer segments and value propositions. /3. Detail the customer relationships and channels. /4. Define the revenue streams and cost structure. /5. Define the eco-social benefits and costs.

Answers
B.

1. Assess and define the key resources, key activities, and partners/2 Define the customer segments and value propositions. /3. Detail the customer relationships and channels. /4. Define the revenue streams and cost structure. /5. Define the eco-social benefits and costs.

C.

1. Assess and define the value propositions for the small size farms customer segment. /2. Detail the customer relationships and channels. /3. Identify relevant key activities, key resources, and partners. /4. Define the revenue streams and cost structure. /5. Define the eco-social benefits and costs.

Answers
C.

1. Assess and define the value propositions for the small size farms customer segment. /2. Detail the customer relationships and channels. /3. Identify relevant key activities, key resources, and partners. /4. Define the revenue streams and cost structure. /5. Define the eco-social benefits and costs.

Suggested answer: C

Explanation:

The Sustainable Business Model Canvas approach for assessing new business models, especially for smaller farms with smaller budgets, starts with understanding the unique value propositions tailored to the needs of small-size farm owners. This is crucial in creating offerings that resonate well with the target market's requirements and constraints. Following this, detailing customer relationships and channels becomes essential in establishing and maintaining a strong connection with the market segment, ensuring the delivery mechanism aligns with their preferences and capabilities. The next step involves identifying the key activities, resources, and partnerships necessary to deliver on the value proposition effectively, which is critical for operational execution and sustainability. Subsequently, defining the revenue streams and cost structure is paramount to ensure financial viability and strategic pricing that aligns with the target market's budgetary limitations. Lastly, delineating the eco-social benefits and costs integrates the broader impact of the business model, aligning with sustainable and ethical business practices, which is increasingly important for modern enterprises. Reference = This sequence is aligned with the methodologies proposed by Alexander Osterwalder in the context of business model development and specifically tailored by SAP for digital business modeling and value engineering within the SAP ecosystem. This approach encompasses strategies for optimizing business processes through value discovery workshops and the application of value management processes across various lifecycle phases (Source: SAP Enterprise Support Services documentation, Digital Business Modelling guidelines, and SAP Value Engineering methodologies).

asked 31/10/2024
Yuriy Georgiev
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