In 2012, ISEE conducted a culminating comprehensive project assessing the fundamental knowledge available about economic management. This was the largest and most relevant project undertaken by ISEE in this area. Eighty-nine invitations were sent to prominent representatives of the professional academic community. Over five months, more than fifty working meetings were held, during which dozens of research papers were reviewed and analyzed.

Findings and Insights

Societal Benefit of BMO: All participants firmly believed in the societal value of knowledge about Business Model Ontology. A model ontology which, for the purposes of economic practice, contributes clear and verifiable knowledge about the principle setup and way of functioning of the enterprise as the systemic anatomical and physiological model does for medical practice

“…Research that can prove empirically that it doesn’t matter how different businesses are, they all function in the same way is bound to make a very big revolution. This will be a boom.”

” Currently, there is no such description of the “anatomy” and “physiology” of the business. There are some descriptions, but separately“

Research progress on BMO: All participants firmly perceived the pursuit of a comprehensive Business Model Ontology as a daunting and seemingly unattainable task as it needs to correspond to the complexity of reality.

“There is no such overarching model. It cannot exist. Any of my colleagues you talk to will tell you that there is no such model. To invent one, that person must be a practitioner who has faced the problems of an enterprise and knows both theory and practice.”

Academic assessment of ISEE’s BMO: The assessment of ISEE’s BMO by the participants showcased that this knowledge contributes to bridging the knowledge gap in the area of comprehensive systemic management of the economy of enterprises.

“What you are trying to do is fundamental scientific research…. I believe that this model is unique. The approach itself is unique.”

Implications

The absence of a clear and verifiable Business Model Ontology poses challenges for economic practice. Without such a framework, understanding the principles governing enterprise functioning remains elusive, which can hinder efficient management.

In summary, ISEE’s research underscores the critical need for academic circles and scholarly publications to bridge this knowledge gap. By fostering collaboration and advancing Business Model Ontology, we can enhance economic management practices and tools and contribute to a more robust and systemic understanding of enterprise dynamics.

In 2022, ISEE conducted a research study aimed at analyzing and identifying the ontological progress in economic management by surveying university students from the most renowned universities: Stanford University, University of California, New York University, Princeton University, Peking University, and Tsinghua University. The primary objective of this study is to investigate the educational system and, more precisely, the practical offerings of economic science and management in terms of practical knowledge about the principle setup and way of functioning of any business. The survey was conducted among individuals, such as current and future business practitioners, managers, consultants, and academics, who are studying MBA and other management-related majors with the aim to acquire such knowledge.

The interviews were structured into four parts: the first part introduced the participants to the topic and explained the concept of Business Model Ontology; the second part presented the knowledge of Canvas; the third part presented the knowledge of Business Model Ontology similarly; and the fourth part provided a rating scale for participants to use in their comparative assessment of the two BMOs.

Findings and Insights

The knowledge of Business Model Canvas does not meet the initially intended sense upon its development and cannot describe comprehensively the operational structure and functioning of industrial enterprises in a manner useful for management practice and the creation of new management tools.

“I think the Canvas shows like a very basic idea of what a business consists of because it classifies it in a framework consisting of several non-exhaustive sections. It talks about the products, how they differentiate, and then like the target customers. So, it does explain something but in a very broad overview. It doesn’t really show you the operational side of a business. It just shows you more of the basic items related to the demand part of it.” – C.C., Peking University

“I am missing any formula, at least in this given 9 boxes, there is no formula to really calcu-late what is going in in terms of resources and money and what is going out. And there is no clear picture of how these things flow in time so that you can gauge how much you are actu-ally getting out in end profit or loss. I think it shows which types of items are going to cost you what and which type of items are going to generate some revenue. That’s it. It doesn’t give you any more detailed relationship than that.” – M.P., Stanford University

ISEE’s Business Model Ontology is evaluated by all participants as providing a much clearer and more accessible understanding of the operational principles of industrial enterprises.

“I think the holistic Business Model Ontology covers all the functional systems in any enterprise. Any industrial enterprise can be described using this knowledge. It shows a very clear relationship between the resources you put in and the resources you can get out of the enterprise. How exactly the process of transformation occurs, what needs to be considered and even sets requirements for the enterprise knowledge that needs to be managed and distributed.” – I.S., Tsinghua University

ISEE’s BMO represents a clear and accessible schematic and formulated universal description of how enterprises operate, which is of exceptional importance for management practice and serves as a solid foundation for creating a new generation of management tools such as the newly developed Business Digital Twin software.

“I am really surprised by the fact that the parameter “time” is incorporated in all the formula, which I think no one has done until now, but this is so logical. Like for the first formula of the “law for positive development”, if the total Value of the Elements of Proprietary Assets of the enterprise for T2 is more than those in the moment in time Т1, then a profit has been achieved, because the value of the assets has increased within this time period. And of course vice versa if it’s less then we experience a loss. And it is so true that looking at this change of value of the internal assets to calculate the economic result would be equal to the economic result when the formula is calculated for the same time period but considering the transactions with clients which includes the sales minus the investments and the expenses for the production of the products. And again it is all about the “time” parameter. It feels very intuitive. It is like the space time continuum theory in physics, but in economics.” – S.T., Princeton University

All students from the specified universities acknowledge a deficit in management education regarding any knowledge of a universal enterprise management model that could serve to create specific management models for a given enterprise or even for establishing new enterprises. This deficit can be addressed with the holistic Business Model Ontology once it is integrated into university curricula.

“Yes, it is necessary to have knowledge explaining the whole enterprise, because like for ex-ample I can mention the ERP system SAP. In reality I feel that for top management they don’t really have a birds eye view for the whole thing. It is usually only individual modules, you know, for example the finance module is just finance and there is nothing that unites the whole enterprise.” – X.Q., Peking University

“I would say the holistic Business Model Ontology is much better at representing all the different aspects and relationships of a business enterprise. To tell you the truth, this is the first time ever that I see something which describes the enterprise in its entirety and can explain how it functions.” – V.V., University of California

Implications

There is a lack of knowledge in management education programs regarding the universal principle setup and way of functioning of industrial enterprises. Today’s educational system provides numerous fragments of knowledge, each part of a potential Business Model Ontology. However, due to the absence of such a universal model, each fragment of knowledge, like the business model canvas, strives to be self-sufficient in order to be usable. Rather than that, there should be a larger focus on the significant lack of connectivity between fragments and the potential derivation of universal knowledge of a Business Model Ontology.