According to Yip, (2004) the disparity between “Business Models” and “Strategy” is more than just mere interpretations as these are two unsimilar concepts that need to be distinguished and thought of differently. However, he did not disconnect both concepts by further stating that the business model sheds more light on the understanding and practices of strategy.
Strategy simply means ‘Plan’ – The plan of an individual, organization or a group that serves to guide an ‘Act’ in the direction of the plan. In other words, it can be further stated as the action plan for different events that may come about (Casadesus-masanell and Ricart, 2010). Thus, the term strategy serving as an action plan could be anything from just plain reasoning to random or well construed ideas, put on paper or residing in the head that stream from thoughts or conversations with other individuals, groups or firms and aims to drive the execution of a particular product or service.
Moreover, various organizations tend to develop or create different strategies that involve detailed planning founded on knowledge and perhaps, a well established understanding of the external environment i.e. The Market and the customers; and the internal environment which comprises of the firms in line with their vision, mission, goals and objectives to tell the direction of execution.
Now, the business models come into play with execution. It is the work that is done or carried out to drive value creation in this case providing value for the customers which in turn ensures value for the organization in terms of profit, recognition, customer brand loyalty, brand image building and reputation and so on.
The business model aims to take the ideas and plans into the market, serve the market needs with these ideas and generate value in return. In other words, “Commercializing innovative ideas” (Zott, Amit and Massa,... [continues]
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