mes thesis - ontology & canvas for strongly sustainable business models - oral defense
DESCRIPTION
The presentation made at the successful defense of my graduate thesis "Towards an Ontology and Canvas for Strongly Sustainable Business Models: A Systemic Design Science Exploration. For a brief intro see http://easyurl.net/About_SSBMC_in_3_mins_Prezi; for more see http://www.SSBMG.com. Full text will be available at http://hdl.handle.net/10315/20777 after ~Aug 30, 2013. Part of my Masters of Environmental Studies in Business Model Design and Sustainability + Graduate Diploma in Business and the Environment at York University's Faculty of Environmental Studies and Schulich School of Business.TRANSCRIPT
1ES / ENVS7999 Thesis, © Antony Upward, 2013
Towards an Ontology and Canvas for Strongly Sustainable Business Models
A Systemic Design Science Exploration
MES* Thesis Defense
August 6, 2013Antony Upward†, CMC, C.Eng‡
* York University Masters of Environmental Studies with Graduate Diploma in Business and the Environment Faculty of Environmental Studies and Schulich School of Business
† Full resume at www.linkedin.com/in/antonyupward‡ Certified Management Consultant www.cmc-canada.ca, Chartered Information Systems Engineer www.engc.org.uk
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Download to Access Speakers Notes on
Many Slides
2ES / ENVS7999 Thesis, © Antony Upward, 2013
Gap and Impact• Gap:
– No micro- economic, social and environmental definition of strong sustainability
– No conceptualization of such a definition within existing business model literature
– No taxonomy for patterns of strongly sustainable business model designs (nor visual design tool)
• Impact of Gap:– Desirable achievement of sustainability outcomes by
organizations unlikely (unreliable) and difficult (inefficient) (Doig, 2003; Ehrenfeld, 2008;McDonough & Braungart, 2002)
• Benefit Audiences if Gap Closed– New and Existing Firms, Policy Makers, Advisors, Investors,
Incubators
3ES / ENVS7999 Thesis, © Antony Upward, 2013
Methodological Challenge / Resolution
How can knowledge of strong sustainability, useful to managers, be created?*
– Challenge: Lack of extant strongly sustainable businesses to theorize from using descriptive science methods
– Resolution: use design science to undertake applied exploratory research:
• Systems Thinking• Focus on net-profit making organizations
Design science creates knowledge based on the experience gained from the rigorous construction and evaluation of artefacts useful to managers
solving problems using the best available knowledge.
* Knowledge of what constitutes a strongly sustainable business is urgently needed to avoid the worst effects of Climate change and other elements of the Global Problématique (Ozbekhan, 1970)
4ES / ENVS7999 Thesis, © Antony Upward, 2013
Research Question
RQ: Is it possible to design an ontology that can be usefully employed to describe a firm’s strongly sustainable business model design?
* Ontology is the artefact being built and evaluated by the systemic design science epistemological approach
5ES / ENVS7999 Thesis, © Antony Upward, 2013
Research Activities and OutputsDesign Science Research Activity Streams
OutputElements
P. D. E.
PrepareBuild
(Develop / Design)Evaluate (Validate)
i. Constructs
Understand the literature:
– Business Models (Profit-First & Strong Sustainability)
– Epistemology
Entities Complete? Consistent?
ii. Models Entity Relationship Model
Comprehendible?Real-world Likeness to Artefact?
iii. Instantiations Case Studies Useful?(Effective, Efficient)
iv. Method Systemic Design Science
Rigorous enough to design useful artefact?D
esig
n Sc
ienc
e R
esea
rch
Out
put
Synthesized from Table 3-13 and 6-25: Table Structure derived from March & Smith, 1995, p.255; with additions from Vaishnavi & Kuechler, 2009, p.6
6ES / ENVS7999 Thesis, © Antony Upward, 2013
Designed Artefacts Overview Wall charts of four of the Thesis Supplementary Materials displayed:
– SM4b: Strongly Sustainable Business Model Ontology
(Chapter 7)
– SM6a: Example instantiation of the Strongly Sustainable Business Model Ontology (Timberland, Chapter 8)
– SM5c & SM7: Example summary instantiation of Timberland using Strongly Sustainable Business Model Canvas (Chapter 8 and 7 respectively)
7ES / ENVS7999 Thesis, © Antony Upward, 2013
Summary of Evaluation Results – Confirming Utility“I really liked is that it
really makes you makes you thinkthink about things
that you would neverconsider before”
Management Consultant “You've ratcheted it upYou've ratcheted it up to the next degree of specificity and
made sure that it is truly about sustainable businesses. Whereas the current [tools] that I’ve seen,honestly could be applied to any
kind of business”Sustainable Business NGO
“The power of this thing is it’s really the first to take the first to take the social aspect and the the social aspect and the
biophysical into biophysical into considerationconsideration. And I
haven’t seen that that any other business model
that would take that into consideration”
Business Architect / Professor / Consultant
“This is an impressive body of work”
Management Consultant
“I like the tool and think it provides a great way to analyze a company”
Leader Eco-Industrial Park
“It’s about timeIt’s about time somebody did something like
this”Author / Consultant
“I recognize this firm.” “This gets the zeitgeist of This gets the zeitgeist of
who we arewho we are, which is great” (Reacting to his business
described using the Canvas)CTO Small Manufacturer
“If I was starting abrand new business, a
significant business today, I would use thisI would use this business model to help me define
and develop a pure detailed business plan”
Management Consultant
8ES / ENVS7999 Thesis, © Antony Upward, 2013
Make it “better, better, faster, faster,
strongerstronger” ?
Learning by Using / Testing Testing
it out some it out some moremore?
Summary of Evaluation Results – Opportunities for
Improvement
A better way to introduce and summarize the
canvas
A methodologymethodology for designing great
sustainable business models?
An “app” so I can do this on my tablet with my
clients?
A communitycommunity of people using and
improving it?
Ensuring the design principles align with the emerging “Gold
Standard” for Sustainable Business?
Training / Workshops for
Social / Environmental
Entrepreneurs ?
A Consulting Service that uses the Canvas
to Diagnose and Improve the
Sustainability of Business?
The design principlesdesign principles to help me come up with
great answers to the 14 questions?
How about some more examples and
case studiescase studies?
9ES / ENVS7999 Thesis, © Antony Upward, 2013
Contributions Summary1. RQ can be answered Yes
– The Strongly Sustainable Business Model Ontology and Canvas achieved a satisfactory level of utility with opportunities for improvement identified
2. Framing of the problem and solution– Weaknesses, world-view, inter-disciplinarity, definitions, proto-
theory/design principles
3. Improvements to (systemic) design science preparation, build and evaluation research design and execution
• Limitations– Time, business process detail, design mode use, longitudinal
use, design method
10ES / ENVS7999 Thesis, © Antony Upward, 2013
Further Work: Academic & Practitioner
• Opportunities to contribute to multiple fields via Multiple epistemic modes
• International practitioner / academic network is growing– Crowd-funded collaborative “Strongly Sustainable
Business Model Innovation” Toolkit planned• Book, app, education and consulting versions• Full alignment with emerging “Gold Standard” for Strongly
Sustainable Business
Join Us! http://signup.SSBMG.com
11ES / ENVS7999 Thesis, © Antony Upward, 2013
Discussion
12ES / ENVS7999 Thesis, © Antony Upward, 2013
Backup Slides
13ES / ENVS7999 Thesis, © Antony Upward, 2013
Comparing Descriptive and Design Science
Research Activity
Tendency Purpose Output Examples
Descriptive Science Inquiry
Describing and explaining the bio-physical and social
Theoretical Truth: the description / explanation / theory is true
Theory* & Evidence
Physics, Chemistry, Biology, Ecology, Sociology, Economics, Psychology
Design Science Inquiry
Building and evaluating something new
Applied Efficacy: the built artefact is useful
Artefacts* & Evidence
Engineering, Medicine, Architecture, Law, Management, Information Systems
* Note that Theories and Artefacts are both credentialed knowledge, but the process of credentialing is different.Table 3-3, Derived from Derived from: Lee, 2000, Slides 15-16 speakers notes; Romme, 2003b, Table 1 & 2)
14ES / ENVS7999 Thesis, © Antony Upward, 2013
“Discovery”
“Justification”
…of Theories
“Build”
“Evaluate”
…Artefacts
Provides “truths” Guide generation,
construction and evaluation of
designs
Phenomena inContext
DescriptiveScience
Research
DesignScience
Research
Provides “value & utility” Phenomena
are created through the use of artefacts.
Informs creation of theories via observation
of phenomena
Tends to be disciplinaryi.e. Theoretical / Experimental
Tends to be Trans-, Inter- or Multi-disciplinaryi.e. Applied / Action Research
* Figure 3-5: Derived from text of March & Vogus, 2010
Design and Descriptive Science – A Causal Loop Diagram
15ES / ENVS7999 Thesis, © Antony Upward, 2013
People• Executives, Managers,
Entrepreneurs, Investors, Business Architects, Consultants
Organizations• Strategy, operations and
innovation planning and decision making groups
Technology• Communication support• Generative (Abduction)
support• Evaluative (Decision
Making) support
Environment Research
D. Build• Strongly Sustainable
Business Model Ontology artefact:
i. Constructsii.Modeliii.Instantiationiv.Method
E. EvaluateE1: SelfE2: Third-PartyE3: Case StudyE4: Synthesis/Analysis
Philosophical• Critical pragmatism
Epistemological1. Design2. Information3. Systems
Key Disciplinary Frames• Natural & Social science• Ecological: sociology,
economics & management• Organization (Innovation,
Strategy, OM/IS)
Methods• Data collection, analysis
design and evaluation techniques
Tools / Techniques / Formalisms
• Literature Review• Entity Relationship
Modelling• Interviews
Knowledge Base
IterativeDesign
Process (D1-4)as
sess refine
Relevance Rigor
P1. Problem P2. Applicable Knowledge
C1. Application to solve problem
C2. Additions to knowledge base
Quality (reliability, consistency, effectiveness) and efficiency of creation of strongly sustainable business models
Consistent explicit process choosing relevant knowledge (A-Search, B-Reflect, C-Apply)
Research Process – Prepare (P), Build (D), Evaluate (E)
Figure 3-19, Derived from Hevner et al., 2004, Fig.2 p.80
16ES / ENVS7999 Thesis, © Antony Upward, 2013
Overall Process for the Design of the Business Model Ontology
Iterative Abduction*,Induction &Deduction
Analysis & Synthesis
* Informed guessing…Charles Sanders Pierce’s "abductive logic" (Martin, 2009).
1. Build“What should this strongly
sustainable business model ontology consist of?”
Iterative Feedback & Evaluation
Analysis & Synthesis
2. Evaluate“Is the strongly sustainable business model ontology
useful?”
Comparator Knowledge from Existent Businesses (Formal & Tacit) (“K1…6”)
Representation of Existent Businesses Business Models as Instantiations of Ontology
Natural and Social Science Theoretical Knowledge
Formal Science
Theoretical
Knowledge
3. Knowledge of Real
Businesses Business
Models Represented
Using Ontology
(2 Case Studies)
2. Knowledge from Real Businesses
(7 Expert Interviews)
1. Knowledge Embedded
in Sustainability
Measurement Tools
Strongly Sustainable
Business Model Ontology & Canvas
(Designed Artefacts)
“K0” “K0-PF” “K0-SS”
Key Theoretical Frames
• Formal ScienceInformation Systems (Computation), Systems, Chaos & Complexity
• Natural Science Physics, Chemistry, Biology& Ecology
• Social Science Ecological: Sociology, Economics & ManagementIncl. Reflexive Modernization, Strong vs. Weak Sustainability
• Organization & Management Innovation, Strategic, Ops & Mgt Info. Systems
17ES / ENVS7999 Thesis, © Antony Upward, 2013
Research Activities and OutputsDesign Science Research Activity Streams
OutputElements
P. D. E.
PrepareBuild
(Develop / Design)Evaluate (Validate)
i. Constructs Literature Review of Key Theoretical Frames – Summarized in Design Principles (ODPs, DDPs)
Entities Identified from Design Principles
Complete? Consistent?
ii. Models Entity Relationship Model developed from Design Principles & Entities
Comprehendible?Real-world Likeness to Artefact?
iii. Instantiations Case Studies Identified
Case Study Instantiations Developed
Useful?(Effective, Efficient)
iv. Method Literature Review of Design Science Literature – Summarized in Build Principles (BPs)
Research Design that Attempts to Minimize Bias by Maximizing Rigour
Rigorous enough to design useful artefact?
Des
ign
Scie
nce
Res
earc
h O
utpu
t
Synthesized from Table 3-13 and 6-25: Table Structure derived from March & Smith, 1995, p.255; with additions from Vaishnavi & Kuechler, 2009, p.6
18ES / ENVS7999 Thesis, © Antony Upward, 2013
Contributions by Output and ActivityDesign Science Research Activity Streams
OutputElements
P. D. E.
Prepare Build (Develop / Design)
Evaluate (Validate)
i. Constructs Rigorous understanding the Problem and related Definitions
Rigorous definition of constructs
Rigorous definition of metrics
ii. Models Rigorous identification of ontology design principles which relates the definitions
Rigorous coding and capture of all the construct inter-relationships
Rigorous relation of metrics to research question and objective
iii. Instantiations None None Novel instantiations of existing business
iv. Method Improvements in (systemic) design science, ontology engineering and soft systems preparation activity design
Improvements in (systemic) design science, ontology engineering and soft systems build activity design
Improvements in (systemic) design science, ontology engineering and soft systems evaluation activity design
v. Better Theory Proto-theory of the Conditions Required for the Emergence of Strongly Sustainable Organization
Proto-Principles for the Design of Strongly Sustainable Organizations
None
Des
ign
Scie
nce
Res
earc
h O
utpu
t
Table Structure derived from March & Smith, 1995, p.255; with additions from Vaishnavi & Kuechler, 2009, p.6
19ES / ENVS7999 Thesis, © Antony Upward, 2013
Contribution: Revised / Novel Definitions (1 / 2)
• A “profit-first” organization is one in which monetary profit is the sole legitimate objective; success is defined in terms of attempting to maximizing monetary profit at all times and over time. (Derived from Friedman, 1962)
• A “strongly sustainable” organization is one in which all of its behaviours and all the behaviours of all other relevant social, economic and biophysical actors, lead to the possibility that human and other life will flourish on the planet forever. (Derived from Ehrenfeld, 2008)
20ES / ENVS7999 Thesis, © Antony Upward, 2013
Contribution: Revised / Novel Definitions (2 / 2)
A description of how an organization defines and achieves success over time.
A Business ModelA Business Model: the logic for an organization’s existence: who it does it for, to and with; what it does now and the future; how, where and with what does it do it; and how it defines and measures its success.
“A Business Model describes the rationale of how an organization creates, delivers and captures value [in monetary terms]”
Value isValue is the perception by a human or non-human actor of a need being met; measured inaesthetic, psychological, physiological, utilitarian and / or monetary terms.
From
To
Value is created when needs are met via satisfiers that align with the recipients world-view, and destroyed when they don’t
Necessary, but not Sufficient
p. 14 Osterwalder, A., & Pigneur, Y. (2009). In Clark T. J., Smith A. (Eds.), Business model generation: a handbook for visionaries, game changers, and challengers
21ES / ENVS7999 Thesis, © Antony Upward, 2013
Comparing Profit-First & Strongly Sustainable Business Model Canvases
V1.031
+
+
Δ
+
Δ
+
+
+
+
+Δ
Δ Δ ++
Δ
Δ
Δ
Δ
Δ
Δ +
+ = New concept in SSBMC which doesn’t appear in BMCΔ = Change / extended concept in SSBMC which does appear in some form in BMC (as indicated by green arrow).
22ES / ENVS7999 Thesis, © Antony Upward, 2013
Evaluation Results Detail
Research ObjectiveAspect of
Utility Metrics
Summary Metric Values
ConfirmatoryOpportunity for
Improvement
RO0 Rigor Context
M1 Expectation High
GR1-11M2 Desirability High
M3 Importance High
RO1a Reliability
CompletenessM4a Completeness
(reliable) Satisfactory GU1-6
M5 Level of Detail Satisfactory – Highly Satisfactory GU8
QualityM6a Comprehensibility
(reliable) Satisfactory – Highly Satisfactory GU7, GU9, GU10
M7 Real-world Likeness Satisfactory – Highly Satisfactory None
RO1b Consistency Quality M8 Internally consistent Satisfactory None
RO1c EffectivenessGeneric M9 Useful to user Satisfactory – Highly Satisfactory GU9, GU11
Beauty M10 Elegance (technical, aesthetic) Satisfactory None
RO2 Efficiency
Completeness M4b Completeness (efficiency) Satisfactory GU1-6
Quality
M6b Comprehensibility (efficiency) Satisfactory GU7, GU9, GU10
M11 Easy to use Satisfactory GU9, GU11
Table 8-14. GR = Gap in Research Rigour; GU = Gap in Artefact utility; Both identified by evaluation activities (Thesis Chapter 8)
23ES / ENVS7999 Thesis, © Antony Upward, 2013
Further Work: Academic• Opportunities to contribute to…multiple fields via
– Existing field Profit-First Business Models– Adding the Bio-physical Environment & Society to
Operations and Management Information Systems– New field of Strongly Sustainable Business Models
• …via Multiple epistemic modes– Design Science: Changes to improve artefact utility– Descriptive Science: 5 testable hypothesis– Action Research: Bring practitioner version of
Strongly Sustainable Business Model Canvas and method for its effective use to market
24ES / ENVS7999 Thesis, © Antony Upward, 2013
Further Work: Practitioner
• 46 International members of OCADU Strategic Innovation Lab Strongly Sustainable Business Model Group
• 10 International “First Explorers” using SSBMCanvas now
– Further feedback accumulating• Planning for not your typical
business “book” underway– 10 International co-contributors
identified– Self Publish, 2014– Crowd-Funded
• Individuals & Organizations• Sufficient Funding Gate ~Fall 2013
• “app”– Design Tool– Business Learning Game
• Community Revenue Opportunities via– Training Service “Toolkit”– Consulting Service “Toolkit”– Education / Classroom “Toolkit”– Sustainability Entrepreneur’s “Toolkit”– Industry Specific “Toolkits”– Sustainability Maturity Level Specific
“Toolkits”• Full alignment with emerging “Gold
Standard” for Strongly Sustainable Business
– Measurement “Toolkit”• Best Practices & More Case Studies
Now Next
Join Us! http://signup.SSBMG.com
25ES / ENVS7999 Thesis, © Antony Upward, 2013
Possible Table of Contents for “Book”
26ES / ENVS7999 Thesis, © Antony Upward, 2013
27ES / ENVS7999 Thesis, © Antony Upward, 2013
www.SSBMG.com• About the Strongly Sustainable Business
Model Canvas ~3 minute Audio Visual Overview
• Survey to give input to book– survey.SSBMG.com
• Mailing List sign-up– signup.SSBMG.com
• Learning / Knowledge – wiki.SSBMG.com/home/learning-map
• Blogs– blog.SSBMG.com– slab.ocad.ca/blogs/antony-upward
http://www.facebook.com/StronglySustainableBusinessModels
@aupward #SSBMG
info (at) SSBMG.com
blog.SSBMG.comMailing List sign-upsignup.SSBMG.com
28ES / ENVS7999 Thesis, © Antony Upward, 2013
Citation• Preferred citation for this work is:
– Upward, A. (2013). Towards an Ontology and Canvas for Strongly Sustainable Business Models: A Systemic Design Science Exploration. (Masters of Environmental Studies / Graduate Diploma in Business + Environment, York University, Faculty of Environmental Studies and Schulich School of Business), 1-891 (i-xx). (http://hdl.handle.net/10315/20777)
– Electronic copy will be available at this handle/DOI after Aug 30, 2013
• All citations in this presentation may be found in the Bibliography of the thesis.