NETWORK-BASED BUSINESS MODEL INNOVATION IN INFORMATION TECHNOLOGY INDUSTRY IN INDONESIA, CASE STUDY OF BANDUNG DIGITAL VALLEY, STARTUP BANDUNG, AND IDCLOUDHOST

• Main Author: RIZKY RAMADHAN (NIM 19014135), FADHILA
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/22020
• Institution: Institut Teknologi Bandung

ABSTRACT <br /> <br /> The information technology industry has 3.3% compound annual growth rate (CAGR) for the 2015- <br /> <br /> 2020 forecast period, making it one of the fastest growing industries. Inventors keep coming up with <br /> <br /> new advancements in the information technology industry after the invention of Internet, ranging <br /> <br /> from e-commerce to cloud data saving. The non-stop development of the information technology <br /> <br /> industry also leads to the change of people behavior. The number shows that in December 2015, there <br /> <br /> are 3.26 billion Internet users, which almost 40% of world population, indicating that the Internet has <br /> <br /> become an important part in people’s daily activities. In Indonesia, the companies in the information <br /> <br /> technology industry have big opportunities regarding to the human resource and the market condition <br /> <br /> (Dhewanto and Anggadwita, 2015). Unfortunately, they still need more improvement focusing on the <br /> <br /> business models before they can compete in the global market. One simple way to innovate the <br /> <br /> business model is by collaborating with other businesses. However, the companies in the information <br /> <br /> technology in Indonesia lacks of the collaboration understanding. Most of them are unaware of the <br /> <br /> existence of the collaborative networks as one of the ways to collaborate (Dhewanto and Anggadwita, <br /> <br /> 2015). The inadequate collaborative networks understanding problem can be broken down into the <br /> <br /> lack of understanding in the existing networks, existing business model, business model innovation, <br /> <br /> and value outcome from the implementation of network, business model and business model <br /> <br /> innovation. Those four problems become the core problems of this research. <br /> <br /> This research focuses on filling the gap of understanding four core problems by providing the <br /> <br /> examples of business practices in several network types. The research uses the conceptual framework <br /> <br /> of network-based business model by Dellyana (2016), which combines four dimensions including <br /> <br /> network, business model, business model innovation, and value. This research uses case study method <br /> <br /> in three selected cases that represent each network type. Bandung Digital Valley represents vertical <br /> <br /> network, Startup Bandung represents horizontal network, and IDCloudHost represents <br /> <br /> multidimensional network. Each of case study is selected based on their past experience on networkbased <br /> <br /> business model innovation that can give an understanding for the companies in the information <br /> <br /> technology in Indonesia to join collaborative networks. The data in the case study are collected using <br /> <br /> semi-structured interview and desk research. The respondents are chosen using purposive sampling, <br /> <br /> focusing on their likeliness to generate data for the research. The respondents include one focal firm <br /> <br /> and one or more members of the network. <br /> <br /> ii <br /> <br /> The result of this case study shows that the different network condition, business model, and business <br /> <br /> model innovation will result in the different value outcome. Vertical network with the rigid system <br /> <br /> and procedure in its network condition provides a closed business model innovation, resulting in six <br /> <br /> kind of capturable values. The horizontal network with member initiative involvement provides an <br /> <br /> open business model innovation, resulting in four types of capturable values. The multidimensional <br /> <br /> network with negotiable partnership collaboration providing three types of capturable values. <br /> <br /> However, the amount of values created are depending on the collaboration within each types of <br /> <br /> network. The results shows that the companies in information technology industry in Indonesia <br /> <br /> should understand the condition of network, business model and business model innovation in each <br /> <br /> network. Thus, they can join a network based on their preferences. Nevertheless, the maximum values <br /> <br /> can be captured if a company join all three kinds of network. <br /> <br /> Keywords: Network, Business Model, Business Model Innovation, Value, Information <br /> <br /> Technology Industry