Using Two Emerging Technologies to Come Up With a Business Idea

Posted: January 5th, 2023

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Using Two Emerging Technologies to Come Up With a Business Idea

Entrepreneurship and innovativeness have become critical for organizational survival in the contemporary business environment characterized by rapidly emerging new technologies, shifting customer preferences, transforming regulatory environments, increasing environmental concerns, and pervading globalization forces (Rachinger et al. 1144). Organizations that lack an entrepreneurial mindset and innovation culture are unlikely to weather the fierce competitive forces existing in the current market. Similarly, organizations and industries must reinvent their business models often to remain relevant and guarantee sustained revenues and profitability in an era where existing business models are becoming obsolete fast as new ways to doing business emerge rapidly, courtesy of emerging new technologies.

Digital technologies have transformed business processes and products in many industries across the world. They have not only lowered operational costs by increasing efficiency the efficiency of organizational processes, but also delivered delivering new products and services cost-effectively. Rachinger et al. (1144) notes that digitalization, which is the combination of two or more different technologies, present unprecedented opportunities for creating radically novel products, services and business models. In turn, entrepreneurs have embraced new digital technologies to propel their innovativeness and enhance the value propositions of their business products and services to discerning customers. The emergence and prevalence of new digital technologies, such as artificial intelligence and three-dimensional (3D) printing, are transforming the manufacturing industry and their effects are now being felt in the medical and healthcare industry (Tech Watch para. 4). Already, these technologies have displayed their potential in fabricating delicate parts of vehicles and aircrafts and toys quickly, accurately, and cheaply, although the equipment remains exorbitant. This report addresses the application of AI and 3D printing technologies to make replacement body parts for patients. It starts by explaining these two technologies and their application in the medical industry. After that, the literature related to business models is reviewed to understand the current state of business model innovation globally. Thereafter, an opportunity business model (OBM) for a venture that would use artificial intelligence and 3D printing to produce body part replacements for patients in the United Arab Emirates is proposed. 

Description of AI and 3D Printing Technologies

Artificial technology (AI) is an innovative technology that enables machines to mimic human thoughts and actions. This technology simulates human intelligence by being associated with human-like traits and cognitive activities, like reasoning, learning, perceiving, and problem-solving, because of its ability to rationalize several options and selecting that which has the most likelihood of realizing a preset specific goal (Amisha, Pathania and Rathaur 2328). Artificial intelligence uses big data and algorithms to perform amazing cognitive activities, which extend human performance. The machine-learning concept and deep learning techniques are instrumental in the current applications of artificial technology in self-driving vehicles, detection of unusual financial transactions in the banking sector, understanding customer behavior in business, and intelligent weaponry (Aimar, Palermo and Innocenti 3). In the medical field, artificial intelligence is being used to analyze large patient data sets provides by electronic medical records (EMRs) and wearable technologies to perform predictive analysis for improved and speedy disease diagnosis, treatment and management (Kulkarni et al. 63). In addition, AI is being applied in medicine discovery, performance of delicate surgical procedures and efficient delivery of healthcare services (Kulkarni et al. 63). More recently, its potential in tissue engineering is being explored, with proofs of concept for production of heart-valve and replacements being documented (He et al. 31; Provaggi, Leong and Kalaskar 472; Wang et al. 41). In this case, AI is being tested alongside three-dimensional printing to make organ replacement parts, considering that it is already being used to create anatomical models for medical training purposes (Mhanna and Hasan 3).

Three-dimensional (3D) printing is a technology that makes three-dimensional objects using the additive manufacturing process. This means that unlike subtractive manufacturing in which an object is made by removing parts of the material, 3D printing builds up the object by adding material (Ahangar et al. 1717). Consequently, 3D printing reduces material wastage while being able to produce complex items in a much shorter time than that required in regular manufacturing approaches. In the medical field, 3D printing is employed to make anatomical models that assist surgeons perform intricate and complex procedures (Briganti and Moine 27). Figure 1 illustrates the several 3D-technologies in existence and are applicable in the medical field.

Figure 1. 3D printing techniques

Source: Ahangar et al. (1717)

Key: A=binder jetting, B=directed energy deposition, C=material extrusion, D=sheet lamination, E=material jetting, F=stereo-lithography, G=powder bed fusion, and H=bio-printing

Description of the Selected United Nations Sustainable Development Goals Targeted By AI and 3D Printing Technologies

Although the sustainable development goals (SDG) by the United Nations have 17 interlinked goals that are intended to be realized by 2030, the goal that is related to health, and therefore relevant to this report is Goal 3: good health and wellbeing. More specifically, this goal aims at ensuring that everyone, regardless of age enjoys a healthy life and wellbeing. In this case, this included ending preventable deaths of infants and children under the age of five (3.2), reducing a third of premature deaths from non-communicable disease (3.4), and significant reduction of deaths from contaminated environment (3.9). This goal can be achieved by availing body and organ replacement parts in a safe and timely manner to avoid preventable fatalities, while reducing material wastage (Bocken and Short 43).    

Review of Business Model Literature

According to Betz (1), a business model is an “abstraction of a business identifying how that business profitably makes money”. This means that it is a viewpoint or the concept underpinning the transformation of inputs into value-adding outputs.  Kavadias, Ladas and Loch (4) provide a definition of a business model in the context of emerging digital technologies when they note that although business model definitions vary and change over time, they describe fundamentally the manner in which organizations create and capture value. Ojala (453) describe business models as having four main elements; the product or service, the network of value, the delivery of value and the model of earning revenue. Similarly, Kavadias, Ladas and Loch (4) characterize business models as having specific features, i) a definition of the value proposition for customers and its pricing mechanism, and iii) an indication of its business organization and value production partners, and iii) a specification of its supply chain structure, which influence the organization’s success through their complex interactions.  They also note that several business models can coexist concurrently in an industry until a dominant one emerges, which reflects the most efficient way of organizing and allocating resources. However, Kavadias, Ladas and Loch (4) revealed that although many attempt to dislodge an existing dominant business model by introducing a new one often failed, new entrants into an industry often succeeded to outcompete incumbents by leveraging a novel technology in their business models. In the same vein, Zott and Amit (20) describe a business model as “an activity system” that aims at satisfying the supposed needs of the market.

Business model innovation is critical for the survival of businesses and should be a significant component of organizational change and regeneration process. With the innovation process being critical to the business model transformation and innovation process, Kahn (453) explains that innovation should be recognized as an outcome, a process and a mindset, and should not be construes as the development of radically new things, but may also include minor incremental changes of things already in existence. As an outcome, innovation leads to changes in products, processes and marketing approaches. Regarding business models, innovation is an outcome of that can transform an industry irreversibly, and business model innovation can focus on either the industry, the revenue, or the enterprise models (Kahn 453).  Correspondingly, Zott and Amit (20) note that in business model innovation, three design features standout, and include structure, content, and governance, such that changing one of these element leads to altering the entire business model. They also reveals that business models are driven by uniqueness, lock-in due to high switching costs, value-enhancing interdependencies and cost-effectiveness.  

Adrodegari, Pashau and Saccani (103) note that manufacturers were being challenged the vagaries of the current global economy such that their traditional business models that focus on products and their sale were no longer competitive in cost, time, flexibility and quality, and therefore were becoming obliterated by new business models. The product-service systems (PSS) business models were replacing the product-sales oriented ones in this industry because they promise revenue increase and new areas of competitive advantage (Adrodegari, Pashau and Saccani 103). In other words, manufacturers were servitizing their product-oriented business models to create new revenue streams by coupling manufacturing and services to generate new value propositions for customers (De Propris and Storai 389). Similarly, Rachinger et al (1145) notes that digitalization was driving business modes transformation through the integration of digital technologies to widen business scope and enhance organizational performance.

Lanzolla and Markides (540) makes a nexus between business model and organizational strategy to fill in the gap left by fragmented research in these two areas. In the end, Lanzolla and Markides (550) argue that firms gain competitive advantage when they are able to marshal “sources of superior interdependencies” using the demand and supply theories of strategy. They arrived at this proposition to help firm gauge their performance against that of their rivals from the business model perspective and noted that since business models between competitors conflict, testing the level and severity of this conflict can help gauge a firm’s competitive advantage over its rivals. The proposed the assessment of the cannibalization and compatibility conflicts to determine the imitability of business model and its effect on the compatibility of the value chain activities where the business model is adopted (Lanzolla and Markides 547). Similarly, França et al. (157) and Geissdoerfer, Vladimirova and Evans (43) argued that business models could pursue profitability while caring for the environment by focusing on sustainability.  

Massa, Tucci and Afuah (73) note that organizations have been trying out new ways of doing business and realizing their strategic goals since the debut of the internet and the boom that followed in the mid-1990s because the internet technology was a highly disruptive technology. This experimentation led to the emergence of three distinct interpretations of the business model concept: i) the business models as characteristics of existing firms, (2) business models as representations of cognitive and linguistic conceptualizations of a business, and (3) business models as formal abstract depictions of the functioning of a business. Besides, technological advancements have spurred business model research as a new area of management theory, which have challenged the conventions of old theoretical models of creating and capturing value that have focused traditionally the supply side rather that both the supply and demand side, as is the case currently. Bocken, Schuit and Kraaijenhagen (79) add their voice it the business model transformation process by noting that experimentation was critical for the transition of traditional businesses into sustainable ones, because it allowed learning about and improving on business model innovation activities using minimal risks and incurring insignificant risks. They argued that collective and continuous learning from the business model experimental processes with stakeholders was critical in developing sustainable business models that were compatible with the emergent contemporary circular economy that prioritized sustainability. In the same vein, Haaker et al. (14) revealed that business model experimentation was a critical component of business model innovation because it allowed organizations to try out different business models before settling for the one that would best suit their circumstances. In this regard, they proposed a business model stress testing approach to assess the toughness of the components of a business model using concepts from scenario planning and business model innovation. 

When entrepreneurs venture into business in an environment of uncertainty, such as that that presented by fast changing technologies, customer preferences and market conditions, they can employ the opportunity creation theory to develop businesses that fit the prevailing conditions (Ojala 453). Opportunity theory creation is derived from the technological entrepreneurship theory and postulates that opportunities for making and selling novel products/services are nonexistent until they are created by entrepreneurs (Jamali eta l. 444). Ojala (472) argue that the opportunity creation theory is suited for anchoring the creation and evolution of business models in an uncertain environment. Likewise, Atkova (149) demonstrated that business model creation runs concurrently with opportunities presented in the industry and market. She noted that the business model creation process was a continuous interchange of conceptualization and contextualization processes interconnected through feedback loops, which were characterized by envisioning the future, developing strategy, performing and assessing the outcomes (Atkova, 149). In this regard, while an opportunity provided a basis for creating value, it required a business model that framed how the opportunity would be actualized though the creation, delivery and capture of value (Atkova, 14). Consequently, the exploitation of opportunities in a business venture lead to the development of an opportunity business model that characterizes the new venture enterprise (Blundel, Lockett and Wang 42). The opportunity business model (OBM) comprises five dimensions and five drivers. The dimensions include the core value proposition, people, place, process, and profit, while the drivers are personal, societal, commercial, legal and technological ones, as illustrated in figure 2 (Blundel, Lockett and Wang 54).  

Figure 2. Components of the opportunity business model

Source: Blundel, Lockett and Wang (54)

Opportunity Business Model for the New Business Idea and One Competitor Business

The medical field has transformed dramatically with the advancement on tissue and body-part manufacturing that enables diseased and injured organs and limbs to be replaced with artificially-made replacements, and AI and 3D printing technologies can propel this transformation further. The new business idea is to employ artificial intelligence and 3D printing to make body part replacements for patients. This idea will underpin a business venture that intends to operate in the medical field and particularly, in the healthcare sector. The business venture that will emerge from this business idea is expect create value to Emirati patients and their families by availing sufficient replacements of critical body parts promptly and without worrying about their compatibility with the patients’ bodies. Currently, Emirati seek organ transplant and body part replacement within the country and in other countries in the region, such as Pakistan and India, to satisfy the high demand. The corresponding opportunity business model is explained by elucidating its dimensions, comprising proposition, people, place, process, and profit, alongside personal, societal and commercial, legal as well as technological drivers.

Proposition

The core value proposition of the new business venture is to provide body replacement parts to patients on demand. Patients will benefit from the several advantages presented by the body replacement parts produced by artificial intelligence and 3D printing technologies (Ng, Chua and Shen 101145). These include the timely delivery of vital body replacement parts, without awaiting for the availability of a willing and compatible donor. Patients usually wait for extended periods to receive an appropriate and matching donor organ, which lowers the levels of medical outcomes while awaiting such donations to materialize. Although the supply of transplant organs matches the demand as illustrated in figure 2, about 7 people pass on while awaiting organ transplantation, while over 107000 were in the waiting list (Organ Donor para. 2). In addition, these replacement body parts reduce the risk of rejection considering that they use artificial materials and not live tissue.

People

The leader of the enterprise is a professional surgeon of longstanding experience and high expertise. This individual heads an interdisciplinary management team comprising surgeons, physicians, mechanical and genetic engineers,

Place

The market for the artificial body replacement parts is global provided there are patients that require replacement of their diseased and injured body parts, such as heart valves, intestines, skin, bones, eyes, ears, and the like. However, before scaling up globally, the venture will commence with the Emirati market. This venture will compete directly with the life and diseased donors that have provided these parts for an extended period and other countries in the region, such as India and Pakistan, from where Emiratis seek these services. 

Process

The venture is structured like a manufacturing enterprise only that is manufactures human replacement parts using cells and inert materials. As such, its inputs will be combination of natural and artificial products, including stem cells, cells from patients, inert metals like tungsten, and composite materials such as carbon fiber.

Profit

The cost of donor tissues is exorbitant and often out or reach for many patients. For instance, in the United States, a heart, intestines, liver and bone marrow transplantation cost $1.66 million, $1.24 million, $878,400, and $1.071 million respectively. Since the Emiratis market for transplantation is in its nascent and formative stage, some Emiratis seek transplantation within the country, while others access these services outside the country, exposing them to the high prices and delays. Therefore, this venture would be profitable by pricing the artificial body parts lower than that of other sources in the country and in neighboring countries like Pakistan and India, where transplantation and replacements are performed.

Societal Drivers

The prevalence of non-communicable diseases is increasing in the United Arab Emirates, like in the rest of the world, due to the increase in sedentary lifestyles. More people are being diagnosed with heart conditions that require valve replacements, and diagnostic technologies become applied increasingly. Moreover, the Emirati society still harbors reservations towards organ transplantation that mix races. As such, artificial body replacements would be appropriate for the Emiratis because it conforms to their religious, cultural and legal demands. 

Commercial Drivers

The United Arab Emirates is undergoing an economic modernization process that is opening up its economy to the international marketplace, a transformation that is sweeping the gulf region currently, and countries seek to diversify their economies and reduce reliance on the dwindling oil revenues. Moreover, the country wished to boost medical tourism by developing is transplantation sector in its healthcare industry.

Legal Drivers

The regulatory framework for organ transplantation exists in many countries where these procedures are performed. For instance, the United Arab Emirates legalized human organ and tissue donation and transplantation in 2016 through the Federal Decree Law No. 5 (Kumar et al. 659).  Although this is a significant development human organ and tissue donation and transplantation in the United Arab Emirates, the availability of transplantation organs remains a challenge in the country.   

Technological Drivers

Artificial intelligence and 3D printing would be used in this venture. These technologies are being used to make rudimentary body parts like bone matrices, skin patches and heart valves. However, these technologies have the potential of fabricating complete organs as they develop.

Competitor Analysis

The United Arab Emirates has 3D printing companies that have ventured into the human parts replacements space. For instance, Xplorer 3D is a Pakistani startup based in the Dubai, which specializes in making prosthetics and is venturing into human tissue printing. In the region, Refugee Open Ware (ROW) is a Jordanian-bases prosthetic manufacturer targeting Syrian refugees, while Organovo and Miromatrix are organ tissue 3D printers based in the United States. These organizations will compete against the proposed business venture in the UAE. Xplorer 3D, which is already in the United Arab Emirates, has a different strategy compared to the one proposed in this report (Hamid para. 2). The Pakistani firm offers 3D as a product rather than a service. Therefore, its business model focuses on assembling and selling 3D human tissue printers using parts manufactured in China, unlike the proposed venture, which will offer 3D printing as a service, instead fabricating and selling human replacement parts and tissues.   

Critical reflection on the use of business models in the entrepreneurial process

Entrepreneurial process involves three critical steps; i) idea generation, ii) opportunity recognition, and iii) exploitation in enterprise, which culminates in a new venture that implements a promising opportunity business model. The opportunity business model is compatible with this entrepreneurial process. This is because it allows the convergence of new digital technologies in the business environment and allows the medical industry to be digitalized.

Recommendations and Conclusion

Recommendations

It is recommended that the Omani business venture of using artificial intelligence and 3D printing to fabricate body parts for patients in the United Arab Emirates uses the opportunity business model. This allows the venture to capitalize on the opportunities presented by the high demand for body replacement parts against a low supply, which is often tenable from neighboring countries.

Conclusion

This report revealed that a business venture aiming to make artificial body parts using artificial intelligence and 3D printing technologies is viable in the United Arab Emirates. The proposed venture should employ the opportunity business model because it capitalizes on the opportunities presented by the high demand and low supply of body replacement parts in the United Arab Emirates alongside the fast developing new digital technologies.

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