Abstract
This study analyses the readiness of an emerging ecosystem for Pay-per-Outcome (PPO) business model. We adopted a qualitative exploratory research approach to assess the readiness of firms (as an individual firm) and the emerging ecosystem in the Indoor Environment Quality (IEQ) industry. The maturity model was used to assess the readiness of emerging ecosystem and individual companies. The study identifies 11 critical dimensions in readiness from an emerging ecosystem perspective. We follow a 4-step process 1) Individual companies’ current readiness level, 2) Individual companies’ target level, 3) Emerging ecosystem’s current readiness level, and 4) Emerging ecosystem’s target level. This is the first of its kind to the best of our knowledge that studied the emerging ecosystem readiness for the PPO business model.
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Notes
- 1.
The maturity model (See Appendix) was adopted from the research paper Pay-Per-X Business Models for Equipment Manufacturing Companies: A Maturity Model. This paper is under review process. We will provide full citation details before the Pro-ve-2022 conference.
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Appendix
Appendix
Dimension | Subdimension | Maturity level | ||||
---|---|---|---|---|---|---|
1. Initial | 2. Experimenting | 3. Defined | 4. Advanced | 5. Optimized | ||
Organizational governance | Operational governance | No PPX-specific operational governance | Operational PPX architecture requirements identified with ad hoc implementation and development | Necessary operational PPX architecture requirements are documented and related governance measures are standardized | Operational PPX architecture requirements are defined and compliance is systematically monitored through related key performance indicators | Operational PPX governance is integrated across company with best practices in place |
People governance | No PPX-specific roles or responsibilities related to PPX business model(s) defined | Responsibilities related to PPX are identified with ad hoc implementation and development | Necessary roles and responsibilities for PPX business model(s) are documented, defined and systematically governed | PPX-related roles and responsibilities are defined with systematic performance monitoring through defined standards and key performance indicators | Roles and responsibilities related to PPX are optimized and defined with respect to all company activities | |
Data & information governance | No set rules for PPX data & information governance | PPX data & information governance requirements are identified with ad hoc implementation and development | Necessary data governance requirements are documented and standardized, with data storage infrastructure defined in production | Data & information governance requirements are defined, with compliance systematically monitored and developed through defined key performance indicators | Data & information governance measures are optimized and integrated across company | |
Strategy | Business strategy | No defined business strategy for PPX business model(s) | Strategy for PPX business model(s) is experimental with ad hoc implementation and development | Strategy for PPX business model(s) is defined and documented | PPX is strategy is defined and continuously developed through defined key performance indicators | PPX business strategy is fully developed and integral part of the corporate strategy |
Resource allocation | No plan for allocating resources towards PPX business model(s) | Basic PPX resource requirements are identified with ad hoc assignment | Procedures for allocating resources towards PPX business model(s) are standardized, allowing systematic resource allocation for specific PPX activities | PPX resource requirements are identified and documented across company, allowing systematic resource management and prioritization at an organizational level | PPX resource allocation follows best practices and is optimized across company | |
Strategic alignment | No strategic alignment between PPX and other strategic objectives | Limited understanding of PPX and its relationship to other strategic objectives with ad hoc alignment practices | Strategic understanding and objectives are shared between relevant business | Strategic objectives are shared across company with compliance and performance monitored through common key performance indicators | Full strategic alignment allowing optimization and development of common strategic goals across company | |
Risk management | Business risks | No PPX-related business risk management | PPX-related business risks are acknowledged with ad hoc management practices | PPX-related business risk are documented, with systematic and defined risk management practices in place | PPX-related business risk management is systematic and monitored, allowing predictive risk management | PPX-related business risk management is proactive, with continuous improvement and optimization of risk management practices |
Operational risks | No PPX-related operational risk management | PPX-related operational risks are acknowledged with ad hoc management practices | PPX-related operational risk are documented, with systematic and defined risk management practices in place | PPX-related operational risk management is systematic and monitored, allowing predictive risk management | PPX-related operational risk management is proactive, with continuous improvement and optimization of risk management practices | |
Cybersecurity risks | No PPX-related cybersecurity risk management | PPX-related cybersecurity risks are acknowledged, with ad hoc management practices | PPX-related cybersecurity risk are documented, with systematic and defined risk management practices in place | PPX-related cybersecurity risk management is systematic and monitored, allowing predictive risk management | PPX-related cybersecurity risk management is proactive, with continuous improvement and optimization of risk management practices | |
Competences & culture | Competences | No identified any PPX-related competences | PPX-related competences are acknowledged with ad hoc acquisition | Basic PPX-related competence requirements are defined and documented, allowing systematic competence acquisition | PPX-related competences are acquired as well as developed systematically | All PPX-related competences can be acquired and managed proactively |
Culture | Culture is product-oriented, with no cooperation between different business units | Organizational culture supports experimentation with limited & ad hoc cooperation between some business units | Organizational culture supports innovation and is open towards PPX, with frequent collaboration between some business units | Organizational culture is committed to PPX business model(s) with common incentives, with frequent collaboration across all related business units | Organizational culture fully supports PPX, with complete trust and open communication at all organizational levels and relevant business units | |
Product lifecycle processes | Beginning of life processes | No identified beginning of life processes for PPX business model(s) | PPX-related beginning of life processes are identified with ad hoc implementation | PPX-related beginning of life processes are defined and systematically implemented for specific project(s) | PPX-related beginning of life processes are defined and implemented across company with systematic management through defined metrics | PPX-related beginning of life processes are optimized and continuously improved across company |
Middle of life processes | No identified middle of life processes for PPX business model(s) | PPX-related middle of life processes are identified with ad hoc implementation | PPX-related middle of life processes are defined and systematically implemented for specific project(s) | PPX-related middle of life processes are defined and implemented across company with systematic management through defined metrics | PPX-related middle of life processes are optimized and continuously improved across company | |
End of life processes | No identified end of life processes for PPX business model(s) | PPX-related end of life processes are identified with ad hoc implementation | PPX-related end of life processes are defined and systematically implemented for specific project(s) | PPX-related end of life processes are defined and implemented across company, with systematic management through defined metrics | PPX-related end of life processes are optimized and continuously improved across company | |
Product & production technology | Smart product & factory | No machine data collection capabilities for PPX business model(s) | PPX data collection capabilities are tested in machine(s), allowing contract-specific, ad hoc data collection from customer(s) | PPX data collection technologies are standardized, with systematic data collection from customer machine | PPX data collection capabilities is integrated in all machines, with performance monitored through defined key performance indicators | Production technology fully supports data-based products for PPX, with performance optimized through cost minimization and efficiency |
Connectivity | No connectivity between machines or production processes for PPX business model(s) | PPX product- and production-related connectivity technologies are experimental and non-standardized | PPX product- and production-related connectivity technologies are standardized and we have access to customer(s)’ machine | PPX product- and production-related connectivity technologies are standardized and monitored through defined quality control measurements for development needs | PPX product- and production-related connectivity technologies are optimized and continuously improved, allowing 2-way/remote connection and control of machines | |
Data analytics | Data access | No access to PPX data | PPX data is identified, but siloed and accessed manually & ad hoc | PPX data is defined, enabling continous data flow and basic automation with online access | PPX data is systematically accessed, with related key performance indicators defined and utilized in quality control | All PPX data can be accessed, with cost-efficient, high-performing and optimized best practices in place |
Data analysis | No PPX data analysis | PPX data analysis is unstructured, allowing descriptive analysis and basic monitoring | PPX data analysis capabilities are defined, enabling diagnostic analysis & recommendations and manual machine tuning | PPX data analysis is systematic and predictive, with performance monitored through defined key performance indicators | PPX data analysis is prescriptive/self-learning, with automation and self-adjusting capabilities | |
Data utilization | PPX data not utilized in decision-making | PPX data utilized for awareness purposes in basic reporting with ad hoc utilization in decision-making | PPX data established as an asset and utilized to support decision-making | PPX data utilzied broadly in the development of overall company strategy, with performance monitored through defined key performance indicators | PPX data is considered as central to company strategy and operations development |
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Kukkamalla, P.K., Uski, VM., Kuismanen, O., Kärkkäinen, H., Menon, K. (2022). Assessing the Readiness of the Emerging Ecosystem (Actor) for the Pay-per-Outcome Business Model. In: Camarinha-Matos, L.M., Ortiz, A., Boucher, X., Osório, A.L. (eds) Collaborative Networks in Digitalization and Society 5.0. PRO-VE 2022. IFIP Advances in Information and Communication Technology, vol 662. Springer, Cham. https://doi.org/10.1007/978-3-031-14844-6_52
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