Value-based business modelling for network organizations: lessons learned from the electricity sector

Speed and availability of information, delivered in past years by Internet technologies, made it easier for any company to outsource primary activities, which resulted in unbundling of many companies’ traditional value constellations into networks of different companies. In the electricity power sector decomposition of the value constellation is not only enabled by technological advances such as smallscale electricity generation devices and Internet-based interconnections, but it is also enforced by government regulations and crucial ecological issues like CO2 reduction. In this paper we present a business modeling methodology, called evalue, which can be used to develop and reconstruct such value constellation in network organizations. This methodology combines rigorous conceptual modeling from Computer Sciences with the analysis methods from Business Sciences. We show how the evalue methodology can be used in the field of distributed power generation. Four European electricity power companies are developing new business cases and the corresponding value constellations, of which we discuss one prototypical business example. For this case we present a evalue business model, and show how we can use this model to make a first financial assessment of the case. Finally, we discuss lessons learned from the evalue modeling in this specific business case of the electricity industry.