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Questioning the use of a popular tool
The business model concept has flourished in recent years. Entrepreneurs and managers have been increasingly looking at it as a panacea to solve all strategic quibbles and evils, thus orienting strategy toward customers and value creation.
However, the business model has a dark side too. As the business model emerged in the practitioner community, without a strong theorization backing it, business model design evolved in a largely unstructured and multifaceted fashion, and no unambiguous definition or conceptualization of the term exists. As a result, this concept now looks more like a buzzword or managerial motto rather than an actual strategic theory with sound foundations.
Moreover, and more subtly, the business model wraps up a number of elements belonging to quite diverse strategic decisions and strategic planning levels. This characteristic, rather than simplifying managers' strategizing, may instead make strategy more obscure, while distracting practitioners from a rigorous and effective strategy analysis.
The business model as an "easy way-out"
Indeed, our direct experience with teaching, mentoring and consulting dozens of start-ups and entrepreneurs involved in executive start-up programs at business schools and incubators proves that "startuppers" see the business model as a fancy framework for strategy formulation, and show a clear tendency to overuse it as the "one and only" model to devise their plans: such preference is often to the detriment of more traditional - though still significantly valid - models and approaches in Strategic Management. Entrepreneurs have to cope with scarce resources - including time - and wish to focus them on what they believe is a number one priority - or sometimes, on what is easier for them to understand and apply. A statement taken from a class interaction with a 20-year-old would-be entrepreneur attending a Startup Program in our School of Management tells much about this common perception: "Don't give me the Five Forces model: that's older than I am [...] Tell me more about that business model thing [...]".
This simplistic approach privileged by the new wave of entrepreneurs led to raising a rather disquieting question: is the business model the result of an evolution of strategic theory, or...