“All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.”
— SUN TZU
Understanding your business strategy is essential to building and creating a valuable business model. There are many different levels to compete at strategy and business model level.
UpThink use business model canvases as strategy tools for companies who want to create their business strategy & business models. Some companies have a clear understanding of their strategy and for others this needs to be distilled. Every company is at a different stage so we can explore this at different levels. For example we can create and/or distill strategies or look for opportunities within the existing model for established companies. Companies have different levels of expertise around this & it could be broken down into four levels.
At a basic level, on business strategy and business models, companies focus on products, technologies, and value propositions (mainly). They aren’t aware that it is often the business model that makes the difference between success and failure.
At the next strategy level are the beginners, they use business model tools such as the canvas as a checklist.
Then there are the masters. These out compete others with a superior business model where every one of the business model building blocks reinforce each other (e.g. Nintendo Wii, Nespresso, Dell).
At the highest level are the ‘invincible’ group – these continuously disrupt themselves while their business models are still successful (e.g. Apple, Amazon.com). These companies disrupt themselves with new and innovative business models, while their existing business models are still successful and make money.
Which level are you at?
Business strategies & business models that outperform others do so in various ways, for example by…
- Disrupting the existing market (e.g. Dell)
- Creating a hard-to-copy competitive advantage (e.g. Apple appstore ecosystem)
- Establishing game-changing cost and/or profitability structures (e.g. Nintendo Wii)
- Creating entirely new markets (e.g. Nespresso)
March 9, 2017