How can you grow your agribusiness by increasing income revenue streams and leveraging your opportunities through considering a new business model?

The three business models:

1. Traditional business model and its value chain that relies on classic activities such as marketing and sales, procurement and inventory management, technology, human resources, and control to achieve its profit returns.

The business model is based around a core business which has the primary activities of human resources, technology, plant, inventory, and procurement.

The two major functions related to business growth are expanding marketing and sales scope, supported by back of house functions to supply a product to a customer

The main competitors are also other suppliers that are transactionally driven and price sensitive.

This type of business acts like a pipeline where the production inputs of energy, land, labour, and financial capital result in an output of some description that work in a straight line to fulfill a customers need.

Often in this competitive type of business reacts to the market pressures it encounters to protect it from competitive forces which results in a dive to the bottom to maintain market share and smaller profit margins.

2. Emerging platform business model, which is mostly online that looks at a complex set of problems to be solved by increasing the number of producers and suppliers to extend its influence across large business ecosystems to meet large markets by exchanging value and increasing the connectivity between producers, and consumers. Examples of this type of transactional business model include players like Google, Air BnB, and Twitter etc.

3. Combination or an integration of these two business models. This requires a particular kind of leadership that is ambidextrous in nature.

That is, it is dependent on a leader and governing body that can keep an eye on controlling and managing the traditional business model and its value chain, as well exploring, integrating, and exploiting the context within which it operates to extract new streams of value from its business ecosystems. This type of business can be offline or offline and online.

This ‘dual’ business model requires an entrepreneurial mindset – moving from a traditional service delivery landscape into a highly adaptive , entrepreneurial one .

This type of business features decision-making capability, structure and compliance for its pipeline products and services as well as having a tolerance for uncertainty and an appetite for experimentation. Business growth emerges through projects and initiatives with robust partners from the same industry and other industry sectors.

Thinking these models through and choosing one is essential for a business as the world is a networked one and is subject to large systems of which we are not aware of.

The fact of the matter is that there are more people outside your business than are in it and no business on its own can achieve what it can as part of a larger range of connections in a system.

A crucial thing to decide about your business is whether the business model chosen is ‘relational’ or purely ‘transactional’ in nature.

Usually, the large platform business and many traditional pipeline businesses are transactional in nature.

Is it just about making money or are there other streams of value to be gained from the intangible factors that come from leveraging trusted relationships that exponentially multiply the value of yours and their business. In other words, growing the pie or slicing it up.

A relational type of business model is reflected in its shared purpose, mission and values grounded in preferred attachment, mutual benefit and realising adjacent possibilities with select trusted partners. This grows the pie.

Strategic Business Growth models to explore

1. Leverage sales in the traditional manner and explore a networked approach through engagement with select connections within the business current ecosystems and beyond.

2. Collaboration with preferred connections for mutual benefit, that leverages adjacent possibilities including cross industry business suppliers and customers and building partnerships with generic and representative connections across systems.

3. Explore the intangible benefits as a trusted supplier to add value to products and services.

4. Explore a dual business model approach that involves ambidextrous thinking

and working with others, to achieve an outcome.

5. Expanding the options generated and increase the decision-making surface area for the company as it expands its options.

Conclusion

Value creation for business growth is a common objective that I come across in all my strategic advisory work in my relationships with CEO’s and senior executives.

Many companies report using organic growth, strategic growth, collaboration, and mergers and acquisitions to expand their service offerings and business growth.

The least important are business as usual (traditional business models) and growth through mergers and acquisitions.

In strategy setting and strategic advisory work the most important and effective growth strategy that we have discovered and facilitated is through adopting a dual business model and collaborating with others by exponentially increasing value.