Analysis of business model failure of engineering companies and tools to avoid it
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Journal Title
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Insinööritieteiden korkeakoulu |
Master's thesis
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Authors
Date
2020-10-19
Department
Major/Subject
Sustainable Energy Conversion Processes
Mcode
ENG3069
Degree programme
Master's Programme in Advanced Energy Solutions (AAE)
Language
en
Pages
82
Series
Abstract
Of all the companies that are formed each year, only 30% of them make it beyond 10 years or longer. This states that 70% of the companies have flaws in their business model, they do something wrong that eventually leads to failure. This thesis is an attempt to analyze the factors that are responsible for the failure of the companies (Start-ups, SME’s & Large organizations) and compare the result of the failed companies with that of a successful company. This thesis is a part of the project ‘Bridging circular economy technologies and business models to advance system-level sustainability research’ at Aalto University. The main idea behind the project was to explore a cross-disciplinary approach in different disciplines such as engineering technology, business, and art & design. Qualitative analysis was adopted as the primary research methodology for this report and the case study approach was selected for this due to the exploratory nature of the research. Overall five cases were studied and analyzed in this thesis work. Three of the five cases were failure analysis cases (Asian Electricals, Nokia, European Batteries Oy.) where the focus was on the failure engineering companies, whereas the remaining two cases were a success (Fortum) and workshop cases. Case studies explain the factors responsible for the failure and success of the respective companies. The business model canvas is used as the main tool to analyze failures and success in the case companies. The majority of the case studies were based on the fundamental of the circular economy. A thorough analysis of literatures comprised of journal papers, blogs, interviews, analysis reports, it was found that lack of a holistic approach and business model innovation failure were the main findings from failure analysis whereas successful business model Innovation and multidisciplinary approach were the success factors.Description
Supervisor
Santasalo-Aarnio, AnnukkaThesis advisor
Miller, ElizabethKeywords
business model, company failure, circular economy, business model innovation, engineering companies