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Posts Tagged ‘alex osterwalder’

Business Model Thinking

Sunday, July 6th, 2008

There are several components of varying complexity that make up any business. It is the quality of these components, and their unique combination (hopefully), that provide businesses with a competitive advantage in the marketplace. From the investment side, understanding the quality of an enterprise is very much tied to understanding the business model of that enterprise, and how it contrasts to its competitors - what advantages that business model creates for the business in the marketplace, and how those advantages will scale over time. Additionally, there is tremendous value in understanding at a deep level that the framework of a given business model gives an edge as companies survey the competitive landscape for strategic risk, and the opportunities inherent to that risk. It is common for businesses to take a very haphazard approach to analyzing, understanding, and building the foundation of their own business model, it is also common for businesses to miss the opportunity of conducting the same analysis of their competitors. This oversight with regards to understanding their own context in the marketplace is most likely due to myth of complexity as it relates to “putting the pieces together” and taking a hard look at the constituent components of the business in question.

I was excited to find the slideshow above, and the , by . Alex has put forth a model for analyzing, understanding, designing, and contrasting business models that is easy, straightforward, and, I believe, incredibly valuable. He provides detail for what actually makes up a business model . There is a lot of writing in business pubs right now about business model reinvention and business model innovation due to the nature of the economy and the competitive environment of different industries. This is all good, but often what is missing are the practical matters of creating an effective baseline from which to engage in exercises and experiments into innovation and reinvention. I believe that Alex succinctly provides us the tools for creating this baseline in a way that is quickly revealing of problems and opportunities, and tied to creating understanding.

Take a moment to review the slideshow and then read Alex’s at his blog Business Model Design and Innovation.