Case Solution for Tianan The IoV Business Model in China

TIANAN: THE IoV BUSINESS MODEL IN CHINA

CASE STUDY SOLUTION




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SYNOPSIS
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On April 21, 2010, Lei Yang established Jiangsu Tianan Smart Science and Technology Co. Ltd. (Tianan)
in Wuxi, Jiangsu Province, China. In the early days of its establishment, the company mainly sold in-vehicle
infotainment hardware devices to automobile companies. After 2014, Tianan changed its business model
and began installing software systems on car mirrors and in-vehicle terminals to serve drivers. However,
from 2010 to 2017, the company was operating at a loss.
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In 2018, the Chinese government began a plan to create internet of vehicle (IoV) pilot zones 2 in different
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regions of China. Yang keenly recognized the opportunity to transform his company and rid it of losses, so
he restructured Tianan’s team, integrated hardware and software suppliers, took advantage of the
government’s help, and led Tianan in becoming an IoV system service provider. Tianan now provided
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planning and consulting, construction management, and innovative operation and data empowerment
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The Case Solution Starts From page 4

,OBJECTIVES

 Define the value proposition of the business model of IoV.
 Identify the key resources of the business model of IoV.
 Explain the key process of the business model of IoV.
 Explain the profit formula of the business model of IoV.




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ASSIGNMENT QUESTIONS
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1. Compared to Tianan’s exploration phase from 2010 to 2017, what changes have taken place in the
customers served by Tianan after the transformation in 2018? What problems are solved for the customer?
2. Why was Tianan able to transform into an IoV system service provider? What advantages does Tianan
have?
3. What was the key process that enabled Tianan to transform into an IoV system service provider?
4. If you were Yang, what measures would you take to help Tianan solve its dilemma?




The Case Solution Starts From page 4

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ANALYSIS



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1. Compared to Tianan’s exploration phase from 2010 to 2017, what changes have taken place in
the customers served by Tianan after the transformation in 2018? What problems are solved for
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the customer?

This question aims to help students master the value proposition of the business model of IoV.
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First, ask students, “Who were Tianan’s target customers from 2010 to 2014? What
services were provided to them? And who were Tianan’s target customers from 2015 to 2017? What
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services were provided to them?” Students can easily give answers. From 2010 to 2014, Tianan’s target
customers were automobile enterprises, and Tianan provided them with in-vehicle infotainment hardware
devices. From 2015 to 2017, Tianan’s target customers changed to drivers, and Tianan provided them with
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integrated information services.
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Then, to help students learn about the value proposition of the business model, refer to the
article by Mark W. Johnson, Clayton M. Christensen, and Henning Kagermann. 4 The authors propose
thinking about the following three questions related to the value proposition: Who are the target customers?
What do they need? How can we meet their demands?5 So it is not possible to invent or reinvent a business
model without first identifying a clear customer value proposition.6 A successful company must find a way
to satisfy its target customer’s need.7 next provide an example to help students understand
the value proposition in a business model. For example, the value proposition of Meta, formerly known as
Facebook, is to provide software and hardware development to create a unique virtual experience for users




The Case Solution Starts From page 4