02 Oct 2019Working Paper Summaries

The Value Potential of New Business Models

by David J. Collis

A business model determines the opportunity’s value creation potential and suggests how the resulting value might be distributed among participants pursuing that model. Strategists need to understand the interaction of elements of the job to be done and asset configuration in order to create differing strategic prescriptions.

Author Abstract

One attempt to regain the ground that strategy has recently lost, which was described in a separate article, has been the introduction of “business models” as the precursor to competitive positioning within an industry. Understanding a business model provides a shorthand description of how value is created - although the business model, by itself, does not determine how profitable it will be for any firm: for that we need to examine the complete strategy landscape.