What is Business Model summary
What is Business Model?
The article “What is Business Model?” is written by Andrea Ovans, a senior editor in the Harvard Business Review. The article deals about the different views of about what is actually meant by business model. Different scholars do have their own thoughts about the meaning of business model which is crucial to the success of the business in this competitive business environment.
Michael Lewis has defined the phrase business model as “a term of art”. He say that business model is an art, as it is something that can be recognized when they come across but are not able to define. Down the years, people have defined it according to their convenience or how they have used it. Lewis defines that business model is how we plan to make money. Business model enables the company to earn money and survive in the business competition. He even cites the example of Microsoft there business model is to sell software for 120 bucks a pop that cost cost fifty cents to manufacture.
Peter Drucker in his “Theory of the Business” has defined the term “assumptions of the company gets paid for” form which Michael Lewis has drawn his definition form. Drucker stresses the fact that the assumptions are important more than the money. Drucker has talked about the set of assumptions about what the company will do and won’t do, which is similar to Porter’s definition of strategy. He says that identifying customers and competitors, their values and behaviors, company’s strength and weakness is very important. He cites the example of IBM who has been able to shift from one business to another and still be successful. He revels that IBM ability to free itself of assumptions is key to the success.
Joan Magretta says that business models are about how businesses work. So, she believes a good model is able to know its customers, customer value, how they deliver value and earn money. So, business needs to be clear about their customers and their value. So, they need to have some
The article “What is Business Model?” is written by Andrea Ovans, a senior editor in the Harvard Business Review. The article deals about the different views of about what is actually meant by business model. Different scholars do have their own thoughts about the meaning of business model which is crucial to the success of the business in this competitive business environment.
Michael Lewis has defined the phrase business model as “a term of art”. He say that business model is an art, as it is something that can be recognized when they come across but are not able to define. Down the years, people have defined it according to their convenience or how they have used it. Lewis defines that business model is how we plan to make money. Business model enables the company to earn money and survive in the business competition. He even cites the example of Microsoft there business model is to sell software for 120 bucks a pop that cost cost fifty cents to manufacture.
Peter Drucker in his “Theory of the Business” has defined the term “assumptions of the company gets paid for” form which Michael Lewis has drawn his definition form. Drucker stresses the fact that the assumptions are important more than the money. Drucker has talked about the set of assumptions about what the company will do and won’t do, which is similar to Porter’s definition of strategy. He says that identifying customers and competitors, their values and behaviors, company’s strength and weakness is very important. He cites the example of IBM who has been able to shift from one business to another and still be successful. He revels that IBM ability to free itself of assumptions is key to the success.
Joan Magretta says that business models are about how businesses work. So, she believes a good model is able to know its customers, customer value, how they deliver value and earn money. So, business needs to be clear about their customers and their value. So, they need to have some