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Enterprise Architecture Matters

Adrian Grigoriu

Business Models are not strategies

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Their "answer is that strategy models show the strategies of a business while business models show the interactions between strategies and the uncontrollable external factors that the strategies are intended to address, such as customers and suppliers."

It is rather obvious, if not self explanatory, that "strategy models show the strategies of a business"! Well a strategy is a strategy indeed.

Alpha further says that business models are "the interactions between strategies and... customers and suppliers"! 
As if current strategies are ignoring customers.... 

Well, I leave this be. But what is the answer though to this FAQ?

The definitions:
Strategy is the path chosen to implement the goals of the business. In some views, it includes the choice of goals themselves.

A Business Model describes the way the enterprise uses its resources to deliver products to a customer segment so that it returns value and makes profit.

Hence, strategy is a path to the future while a business model is a configuration of the business resources to deliver a product to a market.

They have nothing in common. 
Business Models are sometimes called strategies only because they become themselves an enterprise goal, implementing a further way to achieve profit.
Nevertheless, any enterprise today already implements a few business models which have little to do with company strategies.

The "strategy model" terminology means one of too many different things. As such, I don't think the term helps. Perhaps a strategy framework rather than model makes more sense, a framework that offers a few pre-established choices or combination of them that help make or chooses strategies.


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Thank you,Mr. Grigoriu, for your comments on my post, Strategy v. Business Models.
I understand your comments completely because you are putting forward the "prevailing wisdom" on both the definition of a strategy and of a business model while I am challenging both. I agree with Fayol that there is a set of activities, namely strategies, common to all enterprises. This set of strategies is the strategic plan for any organization and the basis for all org design. This set is also the basis for our model of the structure of strategy.
Have you never wondered why there is no model for the structure of strategy? Only for the process of its development? Have you not wondered why strategy within an organization cannnot be shown as dynamic when we all know it is?
As for business models, we think they are much more than the vague general definition currently offered that business models are the way an enterprise organizes its resources. We think business models are the way any choice of action (our definition of a strategy) interacts with external factors.Therefore, for example, a HR strategy can have a business model.
Let's push the ball forward on strategy and business models. Let's challenge where current thinking is obviously not complete. Thank you again for taking the time to comment.

Rather than choosing to challenge established and understood definitions, you'd better come with your alternative concepts because you may be talking about different things.
Alternatively, your definitions may reflect a misunderstanding of the issues at hand.

I think that nobody came with a strategy model, even if I don't know that as a fact, because there is no need for that since a strategy is simply expressed as a statement of direction for a function.
The overall enterprise strategy consists in the harmonised list of all the strategic directions which is what most companies have.

It is the EA that helps put strategy in the context of the enterprise parts they affect and the enterprise project portfolio enabling a target architecture model.

A business model is vague until is expressed in terms of EA that identifies its key parts such as the processes and resources involved that constitute the business model.

Since a strategy is a statement of intent, while the business model is usually a business configuration, they have litlle in common.
Let's keep it like that.

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Adrian Grigoriu blogs about everything relating to enterprise and business architecture, SOA, frameworks, design, planning, execution, organization and related issues.

Adrian Grigoriu

Adrian is an executive consultant in enterprise architecture, former head of enterprise architecture at Ofcom, the spectrum and broadcasting U.K. regulatory agency and chief architect at TM Forum, an organization providing a reference integrated business architecture framework, best practices and standards for the telecommunications and digital media industries. He also was a high technology, enterprise architecture and strategy senior manager at Accenture and Vodafone, and a principal consultant and lead architect at Qantas, Logica, Lucent Bell Labs and Nokia. He is the author of two books on enterprise architecture development available on Kindle and published articles with BPTrends, the Microsoft Architecture Journal and the EI magazine. Shortlisted by Computer Weekly for the IT Industry blogger of the year 2011.

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