BUSINESS: Can One Business Unit Have Two Revenue Models?

Isolde’s Siiquent company targeted the hospital/patient facing healthcare diagnostics market. Emanuel’s Teomik company targeted the research labs and university genetic technology equipment market. Their respective business/revenue models align with their markets because in Isolde’s case, her business-to-business model aligns with the hospitals that need their diagnostic equipment to operate, therefore not reaching consumers directly and thus keeping a steadier revenue model. In Emanuel’s case, because Teomik sells to research labs, providing flexibility in pricing is more valuable for such institutions/labs and thus results in a more profitable revenue model for their academia focused market.

 

The pros of imposing the structure of a single revenue model are more reliability and customer trust over the company as a whole, so no part is confused on what the other is doing. However, a peril of this revenue model is the lack of adaptability to supply and demand and potentially dipping during a recession, etc. 

Letting a company continue on its flexible way would be a pro of the problem identified with the single revenue model. Adjusting in response to the sector of the market makes sense for the research sector since it does not have any tremendous adverse effects on lives, it may just backstall research for a bit. However, a peril of this flexible approach is a lack of uncertainty as a whole – the company could be doing great one day and poorly the next. It also poses a lack of alignment between different teams.

 

I would scaffold a discussion to ensure a fair merging process by first giving space for each side to express their needs and concerns in order of priority. I may limit the concerns to 3-5 to avoid one side dominating the conversation from the start. Then, I think fostering agreement between competing needs and concerns is a must especially if they are blatantly opposing each other. Finally, I would ensure all parties are on the same page and allow conflicts to be resolved either during the meeting or offline.

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