FreeMarkets
The business model of the company can be assessed under four main topics as organization, sales model, market-making process and revenue generation model.
The company uses cross-functional teams to make markets and to develop and build software and information products. This structure enables organizations to use their resources (Especially human resources) efficiently and to create effective data sharing area. Therefore it is a big advantage for the company since it is in a business of selling and delivering a complex conceptual service which requires an eclectic blend of skills.
Also this structure provides flexibility and rapid response to changes, directs attention of everyone toward the production and delivery of value to the customer since each employee has a broader view of organizational goals (Horizontal Structure). But it has some weaknesses like limiting in-depth skill development and requiring significant training of new employees to work effectively in this structure.
How to sell services is an important part of the business model of the company. The company applies direct sales model which consisted of client developers establishing relationships with senior-level purchasing, operations and finance executives at large targeted corporations. These client developers are supported by senior leadership team, Meakem and David Becker. Moreover the company uses media silence policy in its direct sales model till recruiting becomes a bigger part of its challenge.
By this model the company is able to reach senior executives and purchasing decision makers, doesn't lose its competitive advantage since this idea prevents copying and catches opportunity of finding multimillion dollar negotiation projects for purchase ...