Lean as a Business Model

Aki Pekuri1, Laura Pekuri2 & Harri Haapasalo3

1PhD Student, Industrial Engineering and Management, University of Oulu, aki.pekuri@oulu.fi
2PhD Student, Industrial Engineering and Management, University of Oulu, laura.pekuri@oulu.fi
3Professor, Industrial Engineering and Management, University of Oulu harri.haapasalo@oulu.fi

Abstract

This theoretical study explores the role of business models in lean transformation with the aim of explaining why seeing lean as a business model can be beneficial and how managing it as such could lead to more comprehensive transformations and greater lean implementation success. Three elements – the value creation system, the value proposition, and the revenue model – constitute a business model, the main function of which is to describe how pieces of business fit together as a system, thus enabling managers to understand, study and develop a company as a whole. The study uses Toyota’s business model to illustrate the overwhelming influence of adopting lean with regard to a whole business model. It argues that lean must be adopted as a new business model to make transformation successful. If lean is implemented without the intention of changing an entire business model, the objective of accomplishing a comprehensive transformation is likely to fail due to clashes between new ideas and the logic of old business models. Thus, it is necessary for managers to understand their existing business models thoroughly and to comprehend lean as a system that, if implemented, is likely to influence all of the elements of the old business models, thus requiring transformational change.

Keywords

This theoretical study explores the role of business models in lean transformation

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Reference

Pekuri, A. , Pekuri, L. & Haapasalo, H. 2014, 'Lean as a Business Model' In:, Kalsaas, B.T., Koskela, L. & Saurin, T.A., 22nd Annual Conference of the International Group for Lean Construction. Oslo, Norway, 25-27 Jun 2014. pp 51-60

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