Bigtincan Holdings Limited Business Model Assignment
Task Description: To be completed individually, you are required to prepare a business report that deconstructs an organisation's business model and identifies the critical success factors that make the business sustainable. To undertake this analysis you will need to explore different business models, including those that are frequently seen to achieve sustainable success and high levels of profitability. Your analysis will demonstrate your critical thinking skills and your ability to professionally articulate your findings. Before commencing, you must seek your lecturer's approval to undertake an analysis of the business you have chosen.
The type of organisation that should be identified for study is one that is relatively new, innovative in how they operate, and have most likely been established in the last five years. No students will be allowed to examine the same business. While the assignment is an individual one, you are encouraged to discuss with your colleagues the variety of business models that have become popular and why you think they have been successful. To achieve a result that meets your study objectives, please ensure the business report addresses each of the assessment criteria detailed below and which is elaborated in the marking rubric.
The purpose of this business model assignment is to explore the possibilities of the business model that is applied by the company named Bigtincan Holdings Limited (BTH). The analysis is entirely inclined towards the secondary information that is already available and accessible for the people. The high scalable model initiated by the company has resulted in the detailed assessment of the core elements that would be considered beneficial for the functioning of the organization. The emphasis on the risks that are highly encountered by the company results in the fact that leads to the increased productivity and profitability of the company.
This business model assignment investigates Bigtincan Holdings Limited (BTH) which is one of Australia’s leading providers of mobility software that emphasizes on the importance of maintaining an authentic relationship with the customers. The company initiates their product development globally since its foundation in the year of 2012, with their headquarters located in Sydney, Australia. It offers Bigtincan Hub an application platform for mobile workforce that allows them to increase their interaction with the customers (Bigtincan Holdings Limited, 2018). The Hub is powered by artificial intelligence (AI) and it works on popular operating systems such as iOS, android, Windows or Blackberry. The CEO and the Executive Director of the company is Mr David Malcolm Keane who is also its founder. Some of the primary shareholders of the company are Regal Funds Management Pty Ltd. and Australian Ethical Investments Ltd (Bigtincan Holdings Limited, 2018). The revenue of the company in the year of 2016 was recorded to be $7.0 million and the growth rate is expected to be tripled by 2021 ("The #1 Sales Enablement Platform | Bigtincan", 2018). This assessment will primarily focus on the business model used by the company and articulate resolutions that might be appropriate for the future perspective of the company.
2. Business Model
In the words of Bocken et al (2014), the use of highly scalable business model creates an assumption of the existence of a potentially large market, eventually expecting that the business have the opportunity to expand their operations in a short period. BTH falls under the category of scalability and applies the software-as-a-service (SaaS) model. This particular kind of business model is mainly approached by venture capitalists or by the entrepreneurs. This Australian based company considers North America as its largest market for Enterprise Content Management (ECM). The size of the market has been estimated to be $16bn and the growth rate is estimated to be around 16% pa (Safari, Safari, & Hasanzadeh, 2015).
A. Building Blocks: The nine building blocks of the business model canvas covers an overall business perspectives that are highly essential for the products and services of the organization to flourish in the market the industry is operating in. The nine blocks provided below covers the business model requirements of ‘Bigtincan Holdings Limited’.
(For canvas, refer to the appendix section)
- Customer Segments: BTH has been able to gain substantial amount of customers over its foundation. Some of the key customers acquired by the company comprises of the names of AT&T, Guess, Merck and Palo Alto networks (Fan et al., 2015). The company AT&T also has equity shares in BTH. Due to the increasing use of SaaS in almost 77% of the businesses, this particular industry has a huge potential in the market.
- Figure 1: SaaS market opportunity until the year of 2015
(Source: Fang, Tsai & Yang, 2018)
- Key Partners: The business model assignment outlines ways in which the company’s brand has developed awareness and reputation globally, they have managed to acquire some of the prominent carrier and technological partners. The carrier partners of BTH comprise the names of AT&T, Optus, SingTel & Telefonica. The technological partners of the company include Apple, Blackberry, Citrix, Symantec, Samsung, MobileIron and Salesforce (Ramsay & Sandonato, 2017). The partners of the company help in delivering value added service in terms of software use to the valuable customers.
- Figure 2: Software integrations for BTH
(Source: Macnab, Burgess, & Caley, 2017)
- Value Proposition:The value proposition of a business allows in evaluating its benefits for the consumers.
- The BTH software reduces the time that the field personnel spend in finding or initiating content that are highly essential in to perform a task.
- Bigtincan Hub manages to provide almost every detailed measurement and the reporting of the content that are required to be developed by the field personnel and that are to be used in CRM records, for measurement of the content in sales and opportunities.
- The services offered in order to provide effective customer satisfaction with the key partners has helped the company achieve success.
- Key Activities: The key activities of BTH comprises of allowing the field employees to access, customize, present, initiate partnership or share content from a mobile device within a single integrated platform. Their AI system and inbuilt machine learning automatically ‘pushes’ the recent and appropriate content to the user’s mobile device. At the same time, it also ensures the automation of manual processes. The joint ventures between the associates or key partners and concerned company have been able to provide value propositions to the customers and improve their relationship with the organization.
- Figure 3: Global expansion of BTH (Source: Macnab, Burgess, & Caley, 2017)
- The figure presented above provides relevant details on the global expansion of BTH, ensuring that the company will be able to expand their operations and CRM operations by opening up their stores in cities like London, Sydney, Tokyo, Singapore and many more. The sales of this company are supported by their store operations and dealings with major companies operating in the cities. The channels have been selected strategically to tap the potentials of the developing markets and cater to a larger base of customers.
- Revenue Streams: BTH encountered a growth in their revenue in the Fiscal year of 2016 (FY16) to be $7.0m and EBITDA of -$6.4m. According to the business model assignment, the rate in the revenue increased by 52% and the rapid growth is expected to continue with the forecast of 40% within the time of FY16-19, with the cash flow achieving the positive status in FY19 (Macnab, Burgess, & Caley, 2017). The improved services to cater to the needs of the customer segments have helped in generating higher revenues.
- Figure 4: Revenue until FY18 and forecast for FY19
(Source: Macnab, Burgess, & Caley, 2017)
- Cost Structure: The company’s key expenditure is expected in certain departments such as sales & marketing, for product development and for administration and general workforce expenditure. The company is planning to articulate further investment in new and existing sales channels to make sure that they are able to ensure a positive cash flow in the upcoming years. The effective planning and business decisions with the participation of the partners have helped the concerned organization to reduce cost effectively.
(For financial performance and forecast, refer to appendix)
- Key resources: The key resources of the company include cloud computing, the use of artificial intelligence is highly enhanced by the company and at the same time, it is ensured that the key resources they use contribute effectively in their functioning and in increasing their financial performance.
- Customer Relationships: BTH has been able to maintain their relationships with the customers in an affirmative manner but at the same time, it is impacted adversely due to factors such as service disruptions, delays in projects. This business model assignment reviews the relationship is also affected with the non-renewal of contracts because of these factors. The company along with the available resources and valuable experience of the partners is building improved customer relations to trigger further growth of the business.
B. Interrelationships: Establishing the relationship between the nine blocks provided above, allows in the identification of a particular target market that results in the growth and development of BTH. Determining of an appropriate target market allows in creation of a proper pricing strategy that could be considered affordable. If the company is able to attract the right amount of customers and maintain a proper relationship with them then that will justify their value proposition and highlight the importance of their key resources. The software services provided by the company is able to generate revenue with the help of the partners such as AT&T, Optus, SingTel & Telefonica in providing the customers the best methods to access data and content related to sales and opportunities. The support provided to the company helps in managing cost reduction and increasing efficiency by developing positive customer relationships.
C. Critical Success Factors: One of the biggest factors that have contributed in the success of the company is the inclusion of SaaS products and services. Valuing such companies usually involves EV/Revenue multiple (Fordham, Robinson, & Blackwell, 2017). The range of the scalability of the business has resulted in the creation of high percentage of cash inflow. At the same time, it has also resulted in generating further revenue for the company.
D. Downside Risks: The downside risks of the company are related with that of technology, customers, competitive nature of the industry and that with of company personnel as well. The company is highly dependent on third party network infrastructure. Their customer relationship might be adversely affected with that of technological disruptions resulting in the negative impact on the company’s finances (DaSilva & Trkman, 2014). The expertise of the personnel and the nature of the competitive market might result in harming the company’s ability to execute strategic planning.
E. Business Model Changes: There are certain aspects in the building blocks that are quite detrimental to the developmental nature of the company in certain areas. The importance of the company apparently lies in the significance of generating customer satisfaction and by emphasizing on the use of technological advancements. This business model assignment highlights the changes in the channels of the company could enhance their distribution channel thus resulting in further expansion of them on a wider scale. The success of the company is dependent on the changes or advancements in their key resources at the same time as well.
The assessment presented above represents a complete analysis of the different building blocks of a business model that leads to the successful implementation of the strategies that could be considered beneficial for the company. At the same time, it could also be ensured that the efficiency of the company would result in the increasing productivity and profitability of the company. The business model assignment analyses also encountered certain risks that could hamper the functioning of the company.
4. RecommendationsThere are certain changes that the company can make in their strategies to ensure that they are able to enhance their productivity and increase their functioning in the competitive market of SaaS. The following could be considered applicable for the company:
- Initiating a customer driven model
- Expand their accessibility to some more prominent cities around the world
- Form proper mitigation plan to ensure that the organization is able to enhance their functioning in the market
Bigtincan Holdings Limited. (2018). Retrieved from https://www.investsmart.com.au/shares/asx-bth/bigtincan-holdings-limited
Bocken, N. M., Short, S. W., Rana, P., & Evans, S. (2014). A literature and practice review to develop sustainable business model archetypes. Journal of cleaner production, 65, 42-56.
DaSilva, C. M., & Trkman, P. (2014). Business model: What it is and what it is not. Long range planning, 47(6), 379-389.
Fan, H., Hussain, F. K., Younas, M., & Hussain, O. K. (2015). An integrated personalization framework for SaaS-based cloud services. Future Generation Computer Systems, 53, 157-173.
Fang, K., Tsai, W. T., & Yang, M. (2018, January). An Architecture for SaaS-Oriented VV&A. In Proceedings of the 10th International Conference on Computer Modelling and Simulation (pp. 146-151). ACM.
Fordham, A. E., Robinson, G. M., & Blackwell, B. D. (2017). Corporate social responsibility in resource companies–Opportunities for developing positive benefits and lasting legacies. Resources Policy, 52, 366-376.
Kriz, A., & Welch, C. (2018). Innovation and internationalisation processes of firms with new-to-the-world technologies. Journal of International Business Studies, 49(4), 496-522.
Macnab, L., Burgess, N., & Caley, N. (2017). Bigtincan Hldgs. [Online]. Retrieved on 8 Aug, 2018. Retrieved from: https://www.baillieuholst.com.au/publishedresearch/2017/BTH_10apr17.pdf
Ramsay, I., & Sandonato, B. (2017). An Analysis of the Business Objectives of the Largest Listed Companies in Australia, the United Kingdom and the United States.
Safari, F., Safari, N., & Hasanzadeh, A. (2015). The adoption of software-as-a-service (SaaS): ranking the determinants. Journal of Enterprise Information Management, 28(3), 400-422.
The #1 Sales Enablement Platform | Bigtincan. (2018). Retrieved from https://www.bigtincan.com/
A. Building Blocks
Figure: Business Model Canvas
(Source: Macnab, Burgess & Caley, 2017)
Figure 5: Financial performance and forecast of BTH
(Source: Macnab, Burgess, & Caley, 2017)