Three Dimensional Elements for Sustainable e-Business Modelling

Mohammed Naim A. Dewan, Maruf Hossan Chowdhury and Mohammed A. Quaddus

Curtin Graduate School of Business, Curtin University, Perth, WA, Australia

Keywords: e-Business, Sustainability, Business Model, Blended Value.

Abstract: e-business modelling is a prevalent term now days as it converts technology into economic value. The

sustainability of the business is another global contemporary issue. Although e-business modelling and

sustainability are the two major global trends now but still there is no common understanding about the

elements that need to be used for a sustainable e-business model. Surprisingly, none of the e-business

modelling approaches even consider sustainability as a major element. In this paper, therefore, after

extensive literature review on e-business modelling and sustainability of the business we carefully identify

and determine the required elements for a sustainable e-business model. The elements are three dimensional

and selected from customer value area, business value area, and process value area so that the modelling

elements safeguard the interests of all stakeholders (customer, business, society, and environment) while

maintaining the sustainability.

1 INTRODUCTION

The term e-business modelling is widespread but it

is considered that only some views of e-business

have been investigated. Now days, to be competitive

it has become very important that all businesses

carefully validate their business objectives,

requirements, and strategies through a careful

process of formal business modelling with the

current global e-business and e-commerce

initiatives. But a very few business models talks

about the sustainability of the businesses. Although

sustainability issues are considered in some

modelling approaches, they are mainly in strategic

level and not in operational level. To develop a

better understanding about sustainable business and

to enhance the confidence in the feasibility of these

ideas such a modelling framework needs to be

developed that can be easily implemented by the

stakeholders successfully and that will truly

contribute to the innovative e-business modelling

ideas. For the long run sustainability business

modelling approaches only with strategic directions

are not sufficient, instead, a complete sustainable e-

business model with operational directions is

essential.

Blended value or shared value is introduced by

the scholars lately. According to the literature

(Emerson, 2006) blended value is the integration of

economic value, social value, and environmental

value. Blended value which is also referred as

“shared value can be defined as policies and

operating practices that enhance the competitiveness

of a company while simultaneously advancing the

economic and social conditions in the communities

in which it operates” (Porter, 2011). But these

blended value definitions in the literature do not

directly include the business value or the process

value. Business value is vital in the sense that it

safeguards the interest of the organisation and helps

to keep in track for achieving goals. Similarly,

process value is another vital element as it supports

to produce both customer value and business value.

Therefore, we define blended value as the

integration of economic value, social value, and

environmental value for both customer and business.

It is different from CSR (Corporate Social

Responsibility) value in the sense that CSR value is

separate from profit maximization and agenda is

determined by external reporting, whereas blended

value is integral to profit maximization and agenda

is company specific and internally generated. In

such a theoretical lacuna regarding blended value

and e-business modelling the aim of this paper is to

identify the required elements necessary to develop a

sustainable e-business model that will encapsulate

economic, environmental and social aspects in the

strategic and operational settings of organizations.

313

Naim A. Dewan M., Hossan Chowdhury M. and A. Quaddus M..

Three Dimensional Elements for Sustainable e-Business Modelling.

DOI: 10.5220/0003994003130323

In Proceedings of the International Conference on Data Communication Networking, e-Business and Optical Communication Systems (ICE-B-2012),

pages 313-323

ISBN: 978-989-8565-23-5

 2012 SCITEPRESS (Science and Technology Publications, Lda.)

We termed them as ‘blended value elements’. We, in

this paper: (i) explore and determine the important

elements in developing e-business model; and (ii)

investigate how the sustainability dimensions can be

integrated with the value dimensions in developing

sustainable e-business model. The following section

of the article covers extensive literature review on

business modelling, e-business modelling and

sustainability of the business. Section 3 explicate the

importance of the three dimensional elements in e-

business modelling. The identification of three

dimensional elements and their comprehensive

explanation is covered in Section 4. Section 5 is

consists of discussion on findings and further

research direction; and finally, Section 6 concludes

the article.

2 LITERATURE REVIEW

2.1 Business Modelling

The modelling approaches by Petrovic, Kittl, and

Teksten (2001) and Auer and Follack (2002) are

very similar, who view a business model as a model

that “describes the logic of a ‘business system’ for

creating value that lies behind the actual processes”.

Tapscott, Ticoll and Lowy (2000) provide a

typology of business models that they call b-webs.

In the methodology proposed by Afuah and Tucci

(2001), one can find a list of business model

components. Osterwalder and Pigneur (2002)

conceive the business model as the description of

the value a company offers to one or several

segments of customers and the architecture of the

firm and its network of partners. There are some

more researchers who have worked on business

modelling. Among them the research works of Zott,

Amit, and Massa (2010), Hawkins (2001), Stabell

and Fjeldstad (1998), Linder and Cantrell (2001),

Applegate (2001), Hamel (2000),

Papakiriakopoulos, Poulymenakou, and Doukidis

(2001) are worth mentioning.

What is found from the literature is that there are

number of terms used in business modelling.

Business model has been referred to as a statement

(Stewart and Zhao, 2000), a description (Applegate,

2000; Weil and Vitale, 2001), a representation

(Morris et al., 2005; Shafer et al., 2005), an

architecture (Dubosson-Torbay et al., 2002;

Timmers, 1998), a conceptual tool or model

(Osterwalder, 2004; Osterwalder et al., 2005; Teece,

2010), a structural template (Amit and Zott, 2001), a

method (Afuah and Tucci, 2001), a framework

(Afuah, 2004), a pattern (Brousseau and Penard,

2006), and as a set (Seelos and Mair, 2007) found by

Zott et al. (2011). There are even different aspects

that are used by the scholars for business modelling,

such as, product/revenue aspects, business

actor/network aspects, and marketing specific

aspects, etc. Although a number of researchers tried

to include value aspect in their modelling but none

of them precisely point out the contents of the value

that will be able to make a business sustainable.

2.2 e-Business Modelling

It has been found by a study of Zott et al. (2011) that

in a total of 49 conceptual studies in which the

business model is clearly defined, almost one fourth

of the studies are related to e-business. That means,

the majority of research into business models in the

information systems field has been concerned with

e-business and e-commerce; and there have been

some attempts to develop convenient classification

schemas (Al-Debei and Avison, 2010). Table 1

shows the elements that are used for business and e-

business modelling by different researchers. For

example, definitions, components, and

classifications into e-business models have been

suggested (Alt and Zimmerman, 2001, Afua and

Tucci, 2001). Timmers (1998) was the first who

defined e-business model in terms of the elements

and their interrelationships. Applegate (2001)

introduces the following six e-business models:

focused distributors, portals, producers,

infrastructure distributors, infrastructure portals, and

infrastructure producers. Weill and Vitale (2002)

suggest a subdivision into so called atomic e-

business models, which are analyzed according to a

number of basic components. Rappa (1999) provides

taxonomy of e-business models based on the value

offerings and mode of generating revenues.

Dubosson-Torbay et al. (2001) identify the

following principal dimensions for classifying

business models: user’s role, interaction pattern,

nature of the offering, pricing system, level of

customization, and economic control.

2.3 e-Business and Sustainability

A sustainable business maintains a balance among

economic development, environmental stewardship,

and social equity (Sikdar, 2003). In other words,

sustainable business means a business with dynamic

balance among three mutually inter dependent

elements: (i) protection of ecosystems and natural

resources; (ii) economic efficiency; and (iii)

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Table 1: Business modelling elements (adapted from Al-Debei and Avison, 2010).

Authors

Element indicators

Timmers (1998, p. 4)

Architecture, Value Proposition, Business actors and roles, Revenue sources.

Venkatraman and Henderson (1998, pp.

33–34)

Architecture, Organization strategy, Customers,

Asset configuration, Knowledge leverage.

Linder and Cantrell (2000, pp. 1–2)

Business logic, Value Capture, Revenue sources.

Gordijn et al. (2000, p. 41)

Value proposition /exchange, Stakeholder network.

Petrovic et al. (2001, p. 2)

Business logic, Value proposition, Intermediate theoretical layer.

Amit and Zott (2001, p. 4)

Value proposition, Structure, Governance.

Torbay et al. (2001, p. 3)

Value proposition, Architecture, Network of partners, Relationship capital.

Stahler (2002, Online, p. 6)

Abstract, Simplification of current and future business reality.

Chesbrough and Rosenbloom (2002, p.

532)

Coherent framework, Mediating construct, Technology, Economic Value.

Magretta (2002, p. 4)

Value proposition, Customers, Revenue sources.

Bouwman (2002, p. 3)

Roles and relationships: company, customer, partners, Value proposition.

Hedman and Kalling (2003, pp. 49, 52–53)

Key business components, Resources, Customers, Value proposition,

Network, Architecture, Structure, Dynamic.

Campanovo and Pigneur (2003, p. 4)

Conceptual, Intermediate theoretical layer.

Leem et al. (2004, p. 78)

Strategy, Revenue, Alliances.

Shafer et al. (2005, p. 202)

Business logic, Strategy, Value proposition, Value network.

Osterwalder et al. (2005, pp. 17–18)

Conceptual tool, Business logic, Value proposition, Customer segments,

Architecture, Network of partners, Revenue.

Haaker et al. (2006, p. 646)

Blueprint, Network of firms, Customers, Value proposition.

Andersson et al. (2006, pp. 1–2)

Business actors and relations, Value exchange.

Kallio et al. (2006, pp. 282–283)

Value proposition: information/goods/services, Industry participants:

customers/partners/ competitors/government.

Rajala and Westerlund (2007, p. 118)

Value proposition, Set of actors, Revenue.

Janssen et al. (2008, p. 204)

Business logic, Value proposition, Customers; Current or future business.

Rappa (2008, Online)

Revenue sources, Position in the value chain.

consideration of social wellbeing such as jobs,

housing, education, medical care and cultural

opportunities (Bell and Morse, 2009). It has been

evident that there is a positive correlation between

environmental and social sustainability and

economic return (Carter and Rogers, 2008). Even

though many scholars enlightened their study on

sustainability incorporating economic, social, and

environmental perspective but still “most companies

remain stuck in social responsibility mind-set in

which societal issues are at the periphery, not the

core. The solution lies in the principle of shared

(blended) value, which involves creating economic

value in a way that also creates value for society by

addressing its needs and challenges” (Porter, 2011).

Moreover, most of the scholars provide with

hypothetical ideas for maintaining sustainability. A

comprehensive business model for sustainability

with operational directions is still not present.

E-business is the point where economic value

creation and information technology/ICT come

together (Akkermans, 2001). ICT can have both

positive and negative impact on the society and the

environment. But ccorporations have the knowledge,

resources, and power to bring about enormous

positive changes in the earth’s ecosystems

(Shrivastava, 1995). In consistent with the definition

of environmental sustainability of IT (Elliot, 2011),

sustainability of e-business can be defined as the

activities within the e-business domain to minimize

the negative impacts and maximize the positive

impacts on the society and the environment through

the design, production, application, operation, and

disposal of information technology and information

technology-enabled products and services

throughout their life cycle.

3 WHY THREE DIMENSIONAL

ELEMENTS IN SUSTAINABLE

E-BUSINESS MODELLING?

In the past, businesses limited their view of business

profitability as they were only aware of economic

gain and were focused on sound financial systems to

Three Dimensional Elements for Sustainable e-Business Modelling

315

maintain that gain. Similarly, businesses were only

concerned about economic value even when

delivering value to the customers. Then slowly the

trend for socially conscious businesses started and

now a day to compete in the market businesses need

to deliver not only the economic value but the

blended value. Customers now want to know what

total value they are receiving from the businesses.

Therefore, to deliver a total or complete value to the

customers businesses need to include economic,

social, and environmental value in their value

propositions.

As there are multiple stakeholders involved in e-

business modelling this research approach sincerely

considered the stakeholder theory while identifying

the elements of sustainable e-business modelling.

Stakeholder theory holds the idea that businesses

shall take decision considering the interest and

impact of all stakeholders. If a balance cannot be

ensured among the stakeholders, organizational

sustainability will be questioned (Freeman, 1984). A

sustainable organization try to maximize economic,

social, and environmental performance for a

sustainable and value based stakeholder relation

(Perrini and Tencati, 2006). To provide adequate

value to stakeholders and to manage relation with

them organizations need to develop specific

processes at different levels of organization

(Freeman, 1984). Such type of process development

shall be based on considering the economic, social,

and environmental interests of the stakeholders.

Hence, it can be summed up that stakeholder theory

indicates the development of a business model that

recognizes the value requirements of multiple

stakeholders to sustain the business.

Now if we look at the previous research in this

area what we see is that most of the business models

research in information systems field has been

concerned with e-business and e-commerce (Al-

Debei and Avison, 2010). A number of ideas exist

about e-business models of which most of them

provide only conceptual overview and concentrate

only on economic aspects of the business. None of

them exclusively considers the sustainability

aspects. Similarly, there is a growing number of

literature available about the sustainability of

businesses (i.e. (Bell and Morse, 2009, Stead and

Stead, 2000, Epstein and Wisner, 2001, Tanzil and

Beloff, 2006), etc.) which do not focus on e-

business. But the intersection of these two global

trends, e-business and sustainability, need to be

addressed. Although recently a very few researchers

talks about green IT/ICT concept (i.e. (Elliot, 2011,

Elliot and Binney, 2008, Hilty and Hercheui, 2010,

Melville, 2010, Houghton, 2010, Erek, 2011), etc.)

but none of them clearly explains how that concept

will fit in an e-business model to make it sustainable

and at the same time, to protect the interests of the

customers.

It is said that all firms, whether non-profit or for-

profit, create blended value—the only issue up for

debate is the degree to which they maximize the

component elements of value (Emerson, 2003).

According to the literature, the sustainable value

must include values from three areas: (a) Economic

value, (b) Social value, and (c) Environmental value.

Importantly, businesses must also realise that to be

competitive in the market this value need to be

measured from three dimensions:

Dimension 1: What Value is demanded by the

Customers?

This means, the requirements that need to be

fulfilled to minimize gap of what value the

customers are receiving and what value they are

expecting. Businesses need to see whether the

customers are receiving the total value that they are

expecting, or not. If not, the businesses must identify

all the existing discrepancies and try to fulfil those

discrepancy requirements to deliver the total value to

the customers effectively.

Dimension 2: What Value is required by the

Businesses based on their Strategy to reach their

Goals?

Traditionally, customer requirements were the only

concern for the businesses to compete successfully

in the market and still now there is no doubt about

the importance of customer requirements in

business. But now only fulfilment of customer

requirements does not guarantee the long term

competency and profitability for the businesses. To

compete successfully every business must have their

own clear goal defined in their strategy that they

want to achieve in time. This dimension includes

with all the business requirements necessary to reach

the organisation goals.

Dimension 3: What Value is required by the

Businesses to have efficient Value Processes?

Just producing and delivering the value is not

enough to be competitive now a day. Rather, value

need to be produced effectively by the businesses to

compete and to ensure profitability for the long run.

To produce value effectively, efficient process is a

must. All the inefficiencies of the value processes

must be identified and corrected to produce the

value effectively. The requirements that are

necessary to make all the processes of a business to

be efficient are included in this dimension of

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measurement.

4 THE THREE DIMENSIONAL

ELEMENTS

Now, based on the discussion in Section 3 if the

sustainable value is measured from the above three

dimensions value requirements of a business can be

categorised into 9 (nine) groups as follows:

a) Customer value requirements (CVR): VOC

based

1. Economic requirements (EcVR1)

2. Social requirements (SoVR1)

3. Environmental requirements (EnVR1)

b) Business value requirements (BVR): Strategy

based

4. Economic requirements (EcVR2)

5. Social requirements (SoVR2)

6. Environmental requirements (EnVR2)

c) Process value requirements (PVR): Process

based

7. Economic requirements (EcVR3)

8. Social requirements (SoVR3)

9. Environmental requirements (EnVR3)

4.1 Dimension 1: Customer Value

Requirements for Sustainability

(CVR)

Generally, customer requirements indicate voices of

the customers (VOCs). Since rich literature is

available about VOCs, we are not explaining it

further. In a number of research approaches VOCs

are translated as customer requirements through

evaluation and validation (Wang and Hong, 2007,

Chan and Wu, 2005), (Han et al., 2001, Hwarng and

Teo, 2001, Chien and Su, 2003). But we, more

specifically, by customer requirements, mean the

total value (economic, social, and environmental)

that is demanded by the customer. This requirement

can be any or any combination of the economic,

social and environmental value.

Customers can be of different types, such as,

internal customers (shareholders, managers,

employees), intermediate customers (wholesale

people), ultimate customers (recipient of service,

purchasers, institutional purchasers), etc. (Chan and

Wu, 2005). When identifying customer

requirements, every organisation should ask itself

few general questions (Mazur, 2003):

 Which customer will help them the most in

achieving their business goals?

 Are all customer equally important to them, or

some are more valuable to them than others?

Usually, there are too many customer requirements

to be manageable and that is why of classification of

customer requirements is beneficial(Han et al.,

2001) and necessary to limit the budget of

investments. According to our approach, customer

requirements can be of 3 (three) types:

4.1.1 Economic Value Requirements for

‘Customer Requirements’ (EcVR1)

Economic value of a product or service has number

of different definition and explanation in the past

literature. Therefore, we are not going to define it

further; rather we focus on economic value

requirements for customer requirements. In our

approach, this customer requirement means any of

the customer’s value requirements which is

somehow economically related directly or indirectly

to the product or service that is to be delivered to the

customer. These economic requirements are not the

factors from business’s point of view which are

mentioned by Porter in his classical work on

Competitive Strategy (1980) and Competitive

Advantage (1985), instead these economic

requirements are the demands from the customer’s

point of view. In other words, these requirements

mean all types of economic benefits that the

customers are looking for. For example, price of the

product or service is directly related to the product

or service economically. Even quality, after-sales-

service, availability or ease of access, delivery, etc.

also appear under this category.

Generally, economic value requirements are

considered as the top prior requirement from the

customers’ point of view within all of the value

requirements except some product and services

whose value dimensions are different. From the

previous research it has been found that majority of

the customers look for economic value requirements

of the product or service before any other

requirements. For example, Schechter (1984) and

Bishop (1984) identified customers that equate value

with price. Zeithaml (1988) identified from a study

that customer’s equated value of the product or

service with low price. According to Porter (2011),

value for the customer is defined as benefits relative

to costs. In another study by Hoffman (1984) reveals

the salience of price in the value equations of

customers. Zeithaml (1988) also found that number

of customers consider value as price first and quality

second.

Three Dimensional Elements for Sustainable e-Business Modelling

317

Business Value

Requirements

Customer Value

Requirements

Process Value

Requirements

Social

Value

Economic

Value

Environmental

Value

E-

The Three Dimensions Sustainability Dimensions

Figure 1: Proposed elements of e-business modelling.

4.1.2 Social Value Requirements for

‘Customer Requirements’ (SoVR1)

Social value requirement for the customer means

any value for the customer’s society. Almost all of

the products or services produce some sort of value

impact to the society. It will be very difficult to

identify many products or services which do not

have any social value impact, direct or indirect.

Also, there will be very few business activities

which are totally detached from producing some

kind of social value. If it is true that most of the

businesses produce some kind of social value,

positive or negative, then the social value

requirements also must be encountered at the core of

the business model. Today’s customers are

interested to see the contribution or impact of the

product or service or operations of the business

organisations to the society they are living. These

social value requirements are not the social

responsibilities that the business organisations are

thinking to perform; rather these are the

requirements that the customers are demanding or

expecting from the products or services or from the

supplier of the products or services when they

consume that product or service.

Social value requirements can be of different

dimensions. Such as, it can be directly related to the

product or service of the business, such as,

knowledge of the customers’ society, customers’

safety of the product, customers’ health (fresh food,

harmful packaging or ingredients in the food, life-

saving medicines), etc.; or it can be indirectly related

to the business, such as, generating local

employment, supporting education, health and

welfare, loans and assistance to the charities, etc.

Social value requirements may also include

employment policies of the organisation that ensure

diversity, including gender, race and religion, proper

work environment for all the staff that meets social

necessities, encouraging or allowing organisation’s

staff to get involved in fundraising and volunteer

activities for the disadvantaged within the society,

offering business education, community training

programs, etc. Porter (2011) identifies three ways to

create economic value for the customer by creating

social value- by re-conceiving products and markets,

by re-defining productivity in the value chain, and

by building supportive industry clusters at the

company’s locations.

4.1.3 Environmental Value Requirements

for ‘Customer Requirements’ (EnVR1)

Customers, suppliers, and public are increasingly

demanding that businesses minimize any negative

impact of their products and operations on the

natural environment (Klassen and Whybark, 1999).

Customers now a day do not just look at the

economic value of the product or service, they also

want to know whether that product or service or the

supplier of that product or service cause any impact

on the environment. Because they believe ‘business

have major role to play in helping and enhancing the

environment’ and thus, every business should

develop sound environmental management policies

for processes and products (Demirdogen, 2007). It is

also believed now by the customers that there are

number of ways how businesses can reduce the

impact on the environment, for example, sourcing

responsibly, such as, using recycled materials and

sustainable timber, creating an efficient and fuel-

efficient distribution network, creating recyclable

products, minimising packaging, working with

suppliers and distributors who take steps to minimise

their environmental impact, buying locally to save

fuel costs, etc. As a whole, the customers want the

businesses to act more responsibly by performing an

important and positive role in the society through

creating additional environmental value for the

future generations.

Bovea and Vidal (2004) suggest how more value

can be added to the product for the customer by

integrating environmental impact, costs and

customer evaluation during the product design

process. Munoz and Sheng (1995) present a model

which they believe can serve as a framework for

decision-making in environmentally conscious

manufacturing.

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4.2 Dimension 2: Business Value

Requirements for Sustainability

(BVR)

It is proven that better quality of the products or

services lead to the fulfilment of customer

requirements or higher customer satisfaction. But

only fulfilment of customer requirements does not

guarantee the future profitability of the businesses as

the market changes. Therefore, businesses need to

think in advance about how to sustain the

profitability in the long run. Strategic managers will

be mainly responsible to identify the business

requirements by evaluating the current situations and

the future directions of the businesses. Managers

must clearly define their goals and targets when

identifying these requirements. The businesses must

consider its future strategy and all the cost drivers

relative to its operations when selecting these

business requirements. For example, there can be a

number of different business goals that businesses

may aim to achieve in the long run based on their

current circumstances. But whatever the goals are, to

achieve them there are always relative business

requirements that need to be fulfilled. Porter (1980,

1985) provides with a list of common cost drivers

which may guide all the businesses during the

business requirements selection to achieve their

goals. Business requirements can be of different

types depending on what type of business that is. All

business requirements can be classified into 3 (three)

groups:

4.2.1 Economic Value Requirements for

‘Business Requirements’ (EcVR2)

Economic value requirements for business

requirements are those requirements which add

some economic value to the business directly or

indirectly if they are fulfilled. These economic value

requirements are very similar to the requirements

explained in the section EcVR1 except that those

economic requirements are demanded by the

customers and these economic requirements

(EcVR2) are identified by the businesses to be

fulfilled to achieve the planned future goals. For

example, reducing the cost of production, increase of

sales and/or profit, getting cheaper raw materials,

minimizing packaging and delivery cost, replacing

the employees with more efficient machinery,

reducing costs by implementing more efficient

supply chain management systems, saving of time

and energy, etc. add some sort of economic value to

the businesses. Generally, the ultimate goal of

adding some economic value to business is to pass

the savings to the customers in the competitive

market and maximise profit.

4.2.2 Social Value Requirements for

‘Business Requirements’ (SoVR2)

These social value requirements are to add some

value to the society from business’s point of view if

they are fulfilled. Types of social values are

discussed in the section SoVR1. These value

requirements (SoVR2) reflect what social value the

business is planning and willing to deliver to the

customers’ society in time regardless of the

customers’ demand. For building societal value,

Nelson (1998) proposes an approach based on three

elements: (i) efficient and ethical pursuit of core

business activities, such as, creating local jobs,

paying taxes and royalties, implementing social

human resource policies, etc. (ii) social investment

and philanthropy, such as, offering training program

to the community, running employee volunteering

schemes, business education projects, sponsoring

community development trusts, civic improvement,

etc. and (iii) contribution to the public policy debate,

such as, supporting progress for good governance

including anti-corruption initiatives and human

rights standards, contribution to the social policies

including education, training, local economic

development, employment management, etc. Adding

social value by the businesses can be a part of

different types of business goals depending on the

business natures. Part of the goals can be simply for

the wellbeing of the society, or can be for the

competition in the market. For instance, Lever Bros

Ltd. uses few principles to focus on social value,

such as, emphasising on employees’ personal

development, training, health, and safety; improving

well-being of the society at large; using world class

expertise base human safety to ensure consumer

safety; improving living conditions of its employees,

etc. (Zairi and Peters, 2002). Through participation

in community-based programs such as sponsorships,

donations, and employee volunteer programs, global

firm Fortis commit to work to fight illness and

disease, promote education, aid and protect children,

and prevent homelessness and hunger (Snider et al.,

2003) to add social value.

4.2.3 Environmental Value Requirements

for ‘Business Requirements’ (EnVR2)

To be competitive in the market businesses need to

act environmental friendly now a day. According to

Denton (1994), adding environmental value can be a

Three Dimensional Elements for Sustainable e-Business Modelling

319

competitive advantage for the businesses since

businesses can differentiate themselves by creating

products or processes that offer environmental

benefits. As mentioned in the section EnVR1 above,

there are number of ways how businesses can

minimise the impact on the environment. By

implementing environmental friendly operations

businesses may achieve cost reductions, too. For

example, minimum use of environmentally-toxic

chemicals, reduced contaminations, recycling of

materials, improved waste management and reuse or

recycling of waste, using fuel efficient machineries,

minimize packaging, using recycled water, etc.

reduce the impact on the environment and at same

time they may reduce the costs of the businesses.

One of the principles of Lever Bros Ltd. is to take

great care to minimize the environmental impact of

all their operations- from raw material procurement,

product design, manufacture and distribution- to use

and disposal (Zairi and Peters, 2002). In the section

EnVR1, we discussed environmental value

requirements that are demanded by the customers

but these environmental value requirements are

identified by the businesses for their different

business goals that they aim to achieve in time.

4.3 Dimension 3: Process Value

Requirements for Sustainability

(PVR)

Process value requirements are the requirements that

need to be fulfilled to have an efficient value

creating process within the existing business

processes. Even though customer satisfaction can be

obtained effectively and efficiently for some time by

fulfilling various customer requirements, an

organisation still cannot ensure future profitability if

it lacks value creating capability (Wang and Hong,

2007). Process value requirements are identified

from the gap between what is being achieved and

what need to be achieved from the existing value

processes. These requirements are not demanded or

identified by the customers rather they are identified

by the business itself by looking at what amount of

value it is currently producing and what amount of

value it is supposed to produce to safeguard the

interest of customer value and business value. For

example, inaccurate or slow manufacturing of a

product or service by employee or machinery,

untimed delivery, inefficient processes caused by

lack of training, social misconducts, unproductive

waste management, unplanned pollution (air, water,

sound) management, etc. and any other inaccuracies

within the existing processes which can be corrected

without or with very low efforts and/or investments

are identified as value requirements. Common steps

for optimizing business processes which are

analysing, designing, implementing and evaluating

can be followed to have an efficient value creating

system within the organisation. The ‘Process value

requirements’ can be any of the following 3 (three)

types:

4.3.1 Economic Value Requirements for

‘Process Requirements’ (EcVR3)

Economic value requirements for value requirements

are mainly related to the cost savings within the

existing business processes which can be later

transferred to the customers. Again, this additional

value (cost savings) is not demanded by the

customers, instead the managers identify those value

creating inefficiencies within the existing processes

and try to correct them which result in some sort of

economic benefits for the organisations. Then those

economic benefits can be passed to the customers as

economic value by the organisations. For example,

employing skilled workers, keeping up with the up-

to-date technologies, providing adequate amount of

training, using efficient energies, improved supply

chain management systems, etc. can increase the

efficiency of the value processes that can certainly

add some economic value to the organisation that

can be transferred to the customers, if required.

4.3.2 Social Value Requirements for

‘Process Requirements’ (SoVR3)

Recent expectation from each society is that every

business should act honestly and ethically. Value for

the society can be of different types: basic value,

ethical value, voluntary value, etc. To identify the

social value requirements for value requirements

managers look at the whole value process of the

organisation and see whether there is any scope to

add some value to the society they are operating

within the existing value process systems.

Sometimes the businesses even do not hesitate to

spend some extra (investment) or to give some extra

effort if there are chances to add some social value.

In the sections SoVR1 and SoVR2, we have already

explained about what the social value is and their

examples. SoVR3 is different from SoVR1 and

SoVR2 in the sense that SoVR1 requirements are

demanded by the customers, SoVR2 requirements

are identified by the managers that they are planning

to deliver to the customers in the future, and SoVR3

requirements are identified by the managers but they

are identified within the current value process

ICE-B 2012 - International Conference on e-Business

320

system so that they can be fulfilled and delivered

immediately. For instance, educating disadvantaged

children, organising skills training for unemployed

people, employing disabled people, establishing

schools and colleges, sponsoring social events,

organising social gathering, organising awareness

programs etc. can add value to the society and most

of these requirements can be easily fulfilled by the

businesses without or with a little investments or

efforts.

4.3.3 Environmental Value Requirements

for ‘Process Requirements’ (EnVR3)

These value requirements need to be fulfilled to

minimize the impact of current value processes on

the environment. To fulfil these requirements, the

businesses try to find and implement all the

necessary steps within the existing processes that

will stop or reduce the chances of effecting the

environment, thus, adding some value to the

environment. Similar to SoVR3, these requirements

are also identified within the current value process

system by the managers so that they can be fulfilled

and can start adding more value immediately.

EnVR1 requirements are demanded by the

customers but EnVR3 and EnVR2 are identified by

the businesses themselves to increase the value by

increasing the efficiencies in the business processes

now and in the future respectively. For example,

leakage of water/oil/heat, incompetent waste

management, inefficient disposal and recycling of

materials, unplanned pollution (air, water, sound)

management, uncontrolled ecosystem stress, heating

and lighting inefficiency, etc. will result in

incompetency in the value processes for the

businesses. Thus, by fulfilling these requirements

businesses may get rid of these inefficiencies and

add value to the value creation processes.

5 DISCUSSION AND FURTHER

RESEARCH

It has been found from the above discussion that

focusing only on the customers’ demand is not

enough to be competitive regardless of whether the

demand is economic, social, or environmental. As

mentioned above, customer satisfaction can be

obtained effectively and efficiently for some time by

fulfilling various customer requirements but still an

organisation cannot ensure future profitability if it

lacks value creating capability. Moreover, only

fulfilment of customer requirements does not

guarantee the future profitability of the businesses as

the market changes. To be competitive and to

maintain the sustainability an e-business must

consider values (economic, social, and

environmental) from all three dimensions: customer

value requirements, business value requirements,

and process value requirements. It is also found that

each of the blended value elements (customer value,

business value, and process value) need to be related

to all of the sustainability elements (economic,

social, and environmental). What is also realised that

within the blended value elements the customer

value and the business value are partially dependant

on process value as the process value supports the

customer value and the business value.

Based on the three dimensional elements of e-

business model our further research will be directed

at the development of an e-business model based on

blended value which will be sustainable and

simultaneously will safeguard the interests of all the

stakeholders. Therefore, the main objectives of the

further research in this area can be defined as

follows:

 To investigate how the concept of blended value

dimensions can be used in developing an e-business

model.

 To investigate how these three dimensional

elements can be used to determine the

optimal/appropriate design requirements in

developing an e-business model.

 To develop a ‘value-sustainability’ framework

for modelling e-business in conjunction with

‘blended value’ and ‘sustainability’ concepts.

6 CONCLUSIONS

There can be found a number of ideas and proposals

about business modelling and e-business modelling

in the literature and few of them used ‘value’ as the

main element of their modelling. But in their

approaches ‘value’ is measured mainly from the

customer’s point of view and not from the business

point of view or the process point of view. Which

means ‘business value’ and ‘process value’ is fully

ignored in the previous approaches. Recently some

scholars are talking about ‘sustainable value’,

‘shared value, or ‘blended value’; even them did not

consider ‘business value’ or ‘process value’.

Moreover, none of them clearly explicated the value

elements that will protect the interests of the

customer and the business. In this paper, we have

shown the important elements that should be used

for a sustainable e-business model after extensive

Three Dimensional Elements for Sustainable e-Business Modelling

321

literature review. From the literature we have

explored and determined that the three dimensional

elements should be used in developing sustainable e-

business model. We have also shown why these

three dimensional elements should be used for

sustainable e-business modelling. Furthermore, we

have investigated and shown how the sustainability

dimensions can be integrated with the value

dimensions in developing sustainable e-business

model.

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