When discussing business strategy with a business partner she suddenly turn to me and asked, – By the way Eufémia, what is for you the difference between strategy and a business model? ~ Ah, great question – I said!
I defend that the business strategy is a company’s choice made after considering its vision, uniqueness, competitive advantages, wanted goals and available resources. And that business model, is the chosen approach to conquer the market, achieve its goals in a profitable activity, and create economic value. Therefore, a business model must be aligned with the company’s vision, business strategy. And, it must use the company’s uniqueness as a competitive advantage in order to achieve its goals with economic value. In my point of view, it is crucial to have a clear vision along with a strong business strategy before going to design the business model. I understand the Vision and Business Strategy as the “whys” and the Business model as the “how”, “when” and “where” much more connected to the implementation part. I would say that vision/business strategy and business model are two faces of the same coin.
The One-million dollar question is: what do you want to have, a daydream, a nightmare or a for-real business? Obviously, you can have a great vision but if you do not have a good model supporting the implementation plan you will not achieve your goals you will be living a Daydream. On the other way if you have an amazing business model with a strong and feasible action plan but you are missing in Vision you will be living a Nightmare! So, If you want a For-Real Business you need a vision, strategy, business model and an action plan. And, the way you mix and weigh each of these factors it is KEY to what you end up with: a Company, a Daydream, or a Nightmare!
#1 Vision should come first along with the uniqueness and competitive advantages proposal;
#2 Define Business strategy to achieve Goals and to translate your vision;
#3 Design the Business Model to be aligned with your business strategy and to have a strong mechanism behind the business implementation and
#4 Have an Implementation plan that is based on your business model, reflects the company’s uniqueness and make the best use of its competitive advantages;
#5 Energize the company’s competitiveness by deploying the resources and action plan in articulation with the business model.
#6 Leverage on the synergies of having a “perfect” alignment between vision, strategy and action.
“Vision without Action is a daydream, but Action without Vision is a nightmare.” Japanese Proverb