What is Strategy?
It is a multidimensional concept :
- Stakeholders
Consideration of the interests of all parties affected by the company's decisions. - Long-term
A vision that goes beyond the daily operational horizon to ensure sustainability. - Plan
A structured roadmap to achieve the set objectives. - Purpose
Clear goals that guide all actions and decisions.
Modern definition
Strategy involves defining the long-term goals and direction of the company to create value and build a sustainable competitive advantage.
Military origins
From the Greek "stratos" (army) and "agayn" (to lead). Unlike war, business strategy is a positive-sum game.
Conceptual evolution
From a military art to a management science, strategy has adapted to modern economic realities.
Thought or Action?
Strategic Thinking
Reflection that anticipates and considers future possibilities. Focused on the long-term vision.
Strategic Action
Concrete deployment of strategic choices. Commits the company to a specific direction.
Strategic Management
Cyclical process: understanding, administering resources and controlling operations.
Absolute Advantage (Smith, 1776)
The basis for the economic specialisation of nations in what they produce best.
Comparative Advantage (Ricardo, 1817)
Mutual benefit from trade even when a country is less efficient in all productions.
Competitive Advantage (Penrose, 1955)
A firm's ability to create more value than its competitors in an imperfect market.
The Study of Winners
Concept of the Market
Transformation of the notion of the market towards that of the industry, defining the competitive arena.
The Industry According to Bain (1951)
Group of products that are close substitutes to each other but distant from other products.
Competitive Arena
Defined space where companies compete to gain a sustainable competitive advantage.
Is investing profitable?
4.9%
Inflation rate
INSEE, 2023
1.79%
Risk-free rate
France
4%
Cost of capital
Europe
11%
Risk premium
Global average
The inter-industry gaps vary considerably, from -43% (air transport) to 31% (water, video games), affecting the potential profitability of investments.
Business Model Generation
Definition according to Amitt & Zott (2001)
Organisational system of transactions designed to identify opportunities and create value in a changing environment.
Systemic vision according to Cheah et al. (2019)
Understanding of how an organisation orchestrates its activities to propose, create and capture value.
Business model innovation
Search for new logics and ways to create and capture value for stakeholders.
The concept of the business model is fundamentally concerned with how a company creates value for its customers in order to be profitable.
Business model according to Lehmann-Ortega
Simplicity
Clear and accessible presentation of the revenue model.
Analysis
Deep understanding of the value creation mechanisms.
Profitability
Focus on the sustainable generation of revenue and profit.
Communication
Ability to effectively "pitch" the business model.
According to Lehmann-Ortega et al. (2017), the business model simply explains how a company manages to generate revenue profitably.
Business plan (BPI France)
Complete document
Overall presentation of the business project incorporating all preliminary studies.
Diverse content
Includes the presentation of the team, the legal form, the market study and the commercial strategy.
Financial forecasts
Includes four essential financial tables over a three-year horizon.
Integration of the BMC
The Business Model Canvas is a key component of the modern business plan.
The business plan remains an essential tool for business creation and fundraising, even in the era of new tools like the BMC.
Business Plan vs Business Model
Business Plan
The bible of the project. A standardised, operational and quantified forward-looking document. Presents the project in its entirety.
Business Model
The economic functioning of the company. Defines how the company generates revenue.
Relationship
The Business Model is included in the Business Plan. They are complementary but distinct.
Understand the structure and components of the BMC
- Visual tool
Clear and concise presentation of all aspects of the business model. - Integrated approach
Nine blocks covering all the strategic dimensions of a company. - Systemic perspective
Understanding the interrelationships between the different components.
Why Use the Business Model Canvas?
- Strategic Innovation
Discover untapped revenue streams and create compelling value, as demonstrated by Back Market's innovative model on refurbished electronics that simultaneously drives sustainability and profitability - Market Adaptation
Rapidly pivot your business strategy when market conditions change, opportunities arise - Competitive Analysis
Articulate your distinctive value proposition and competitive edge, similar to Veja's strategic emphasis on ethical sourcing and eco-friendly manufacturing that sets them apart in the saturated footwear industry - Clear Overview
Visualize all nine critical components of your business model at once to identify inefficiencies, optimize resources, and ensure perfect alignment across every business function
The Business Model Canvas includes four key economic elements that define how a company creates and delivers value to customers.
Customer Segments
The groups of people or organisations that the company aims to reach. Can be segmented by purchasing behaviours, demographics or specific needs (B2B, B2C, mass market, niche).
Value Proposition
The bundle of products/services that create value for a specific segment. It solves a customer problem or satisfies a specific need through quantitative (price, speed) or qualitative (experience, design) benefits.
Channels
The means by which the company communicates and delivers its value proposition. Includes physical (stores), digital (e-commerce, apps) and the information, purchase, delivery and after-sales phases.
Customer Relationships
The nature of the links established with each segment. Ranges from personalised (dedicated service, co-creation) to automated (self-service, communities). Directly influences customer retention and acquisition.
Economic aspects (suite)
Revenue Streams
How does the company generate revenue? Direct sales (one-time payment), subscriptions (recurring revenue), licences, service fees, transaction commissions, advertising, or freemium model. Diversifying revenue sources reduces financial risks.
Cost Structure
What are the main fixed costs (premises, salaries) and variable costs (raw materials) of the company? Identify possible economies of scale and distinguish high value-added activities from unavoidable costs to optimise profitability.
Key Activities
The essential actions required to operate your business model, such as production, problem-solving, or platform management. For example, for Netflix: technology development, content acquisition, and user data analysis.
Key Partnerships
The network of suppliers and strategic partners that make your model work. This can include strategic alliances, exclusive suppliers, or distribution partners. For a startup, this could be investors, technology providers, or specialised distributors.
Key Resources
The essential assets required to create and deliver your value proposition: physical resources (equipment, buildings), intellectual (patents, brands), human (expertise), and financial (cash, credit lines).
The "What" of the Offer
Products and services offered, needs met and problems solved for customers.
The "To Whom" of the Offer
Targeted customer segments, distribution channels and reasons for valuing the offer.
The value proposition is the central element of any business model. It represents the promise made to customers and defines why they should choose you over your competitors.
Unique
Distinguishes your company from competitors by offering something novel in the market. This uniqueness can come from the technology, approach or combination of benefits.
Precise Solution
Solves a specific problem for a targeted customer segment by addressing their unmet needs. It demonstrates a deep understanding of your customers' challenges.
Competitive Advantage
Offers superior measurable and demonstrable performance. Customers must clearly perceive the difference between your offer and that of competitors in terms of quality, price or experience.
Innovation
Provides a solution that transforms the market or creates new opportunities. Innovation can relate to the product itself or its delivery, usage or monetisation.
Develop your value proposition by analysing customer needs and existing solutions. Identify the gaps that you can uniquely fill.
An effective value proposition must be clear, concise and easily communicable, answering the question: "Why choose your product over another?"
Remember that it must evolve with the market, consumer behaviours and technological advancements.
Difference: Marketing vs Value Proposition
Marketing
Influences perception to drive sales. Concerns communication and promotion.
Value Proposition
Focuses on the real benefits offered. Demonstrates how you meet customer needs.
Common Objective
Attract potential customers. Convince them to choose your business.
Identification
Precisely determine your segments. Restrict your focus to a target in order to address it better.
Differentiation
Recognise the specific needs of each segment. Adapt the value propositions.
Strategy
Develop a customised marketing strategy. Optimise distribution for each segment.
The success of a business largely depends on its ability to interact effectively with its customers through strategic channels, personalised relationships, innovative loyalty programmes and structured feedback systems.
Distribution Channels
What means do you use to deliver your value proposition and reach your customer segments in an optimal way?
Feedback
How do you collect, analyse and incorporate customer feedback to evolve your offering?
Customer Relationship
How do you establish and maintain meaningful interactions that strengthen trust and satisfaction?
Loyalty
What methods do you deploy to transform occasional customers into engaged brand ambassadors?
Revenue streams are the various mechanisms by which a company monetises its value proposition and generates revenue from its different customer segments.
Direct Sales
A one-time transaction involving the transfer of ownership of a physical or digital asset in exchange for immediate financial compensation.
Commission
Charging a percentage or fixed fee on transactions between third parties facilitated by your platform or intermediary service.
Subscription
A recurring revenue model where the customer pays periodically for continued access to a service, providing financial predictability for the business.
Freemium
A hybrid strategy offering a free basic version with limited features, incentivising conversion to premium value-added options.
The operational foundations of a business rest on three essential pillars: the resources it has, the activities it executes, and the partners with whom it collaborates.
Key Resources
- Human resources
- Physical infrastructure
- Intellectual property
- Financial resources
Key Activities
- Production
- Problem solving
- Platform/network
- Research and development
Key Partners
- Strategic alliances
- Suppliers
- Coopetition
- Joint ventures
The cost structure represents the set of expenses necessary to operate your business model.
The choice between these two strategic orientations will profoundly influence your market positioning and your relationship with customers.
Fixed Costs
Expenses that remain constant regardless of the level of activity: rents, salaries, equipment.
Variable Costs
Expenses that evolve proportionally with your production: raw materials, commissions.
Cost-Oriented Approach
Strategy of minimising expenses to optimise margins and offer competitive prices.
Value-Oriented Approach
Focus on creating premium value, even if this implies higher costs.
Adaptability
Adjusts according to market evolution and objectives. Allows for continuous iteration of the model.
New Products
Helps introduce a new product or service. Clarifies the market positioning.
Rapid Validation
Allows quickly testing the viability of a concept. Identifies inconsistencies before investment.
- Often abandoned after creation
- Does not replace traditional tools
- Risk of reification in a strategic business unit
- Can hinder organisational agility
Business Model Canvas
Customer Segments
Consumers concerned about food waste, students, families, eco-citizens.
Value Proposition
Buy meals at a lower cost while reducing food waste.
Channels
Mobile app, partnerships with restaurants and supermarkets.
Customer Relationships
Intuitive app, food waste awareness programme, community engagement.
Revenue Streams
Commission on each transaction made through the app.
Key Resources
Customer database, network of partner merchants, matching algorithm.
Key Activities
Technological development, acquisition of new merchants, raising awareness about waste.
Key Partnerships
Supermarkets, restaurants, bakeries, NGOs against food waste.
Cost Structure
Development and maintenance of the app, acquisition of new partners, marketing.
Business Model Canvas
Customer Segments
Consumers looking for an alternative to new products, concerned about their environmental impact.
Value Proposition
Refurbished tech products with warranty, cheaper and more environmentally friendly.
Channels
Website and mobile app.
Customer Relationships
Responsive customer service, commitment to product quality and warranty.
Revenue Streams
Commission on each sale of a refurbished product.
Key Resources
Technology platform, network of certified refurbishers.
Key Activities
Connecting sellers and buyers, quality control, marketing.
Key Partnerships
Refurbishing workshops, carriers, logistics companies.
Cost Structure
Website development and maintenance, customer acquisition, customer support.
Adapting the BMC to Impact Projects
Developed by Joyce and Paquin (2016), the Triple Layered Business Model Canvas (TLBMC) extends the traditional Business Model Canvas by adding environmental and social layers, thus offering an integrated vision of sustainable value creation.
The research demonstrates how the articulation of these three layers influences strategic analysis and reveals different conceptions of sustainability.
The evolution of the Business Model concept illustrates a paradigm shift towards a systematic integration of environmental and social dimensions.
1950s-1990s
Initial emergence of the Business Model concept (Bellman et al., 1957), but remained a largely underutilised theoretical framework for several decades
1990s-2000s
Rapid expansion of the concept with the advent of internet companies and the proliferation of diverse theoretical frameworks to capture this new economic reality
2000s-2010s
Standardisation of the concept thanks to Osterwalder & Pigneur's Business Model Canvas, which became a global reference but was primarily focused on economic value creation
2010s-present
Paradigmatic transformation towards Sustainable Business Models and Circular Business Models, systematically integrating environmental and social dimensions into traditional economic logics
Sustainable Segments
Clients concerned about their carbon footprint, environmental associations
Environmental Partnerships
1% for the Planet, B Corp certification
Environmental Value
Waste reduction, recycling, eco-designed materials
Environmental Activities
Optimisation of water consumption, emission reduction
The environmental layer, inspired by Life Cycle Analysis, evaluates the ecological impact of Patagonia's business model. The company incorporates recycled materials, optimises its supply chain and engages in a circular economy with its Worn Wear programme.
Impact on society
Actions for biodiversity and climate justice
Impact partnerships
Environmental and social NGOs, activist movements
Social value
Support for communities, environmental education
The social layer represents Patagonia's social and societal impacts. The company is committed to fair working conditions with Fair Trade certified factories and regular audits. It actively supports local communities and is involved in environmental education.
This dimension completes the model by ensuring that the creation of economic value is accompanied by a positive impact on people and communities.
Economic Canvas
Foundation of the model, covering the 9 classic blocks of Osterwalder & Pigneur
Environmental Canvas
Ecological extension with 9 blocks analysing the life cycle and environmental footprint
Social Canvas
Human dimension through 9 blocks measuring social impact and value created for stakeholders
The TLBMC revolves around two essential types of coherence: horizontal (internal to each canvas) and vertical (interconnection between the three levels). Our analysis reveals that while horizontal coherence is widely explored in academic literature, vertical coherence remains paradoxically neglected despite its decisive role.
- Lets examine the Triple Layer Business Model Canvas through the case of a Spanish importer of European wines and exporter of Spanish wines. Founded in 2014, this 8-employee company achieved a turnover of €900,000 last year.
- We will examine how this wine company has integrated these three dimensions into its business model and how its innovations have contributed to its growth and differentiation in the market.
Initial Value Proposition
Offer a unique experience through high-quality wines from four different appellations of origin
Major Innovation
Launch of the first certified vegan wine in Spain in 2016, targeting a neglected segment
Distribution Channels
70% retail sales (Horeca), 20% international exports, 10% regional distributors and e-commerce
Results
Increased sales volume, better strategic flexibility, competitive differentiation
The company has adopted a differentiation strategy based on close customer relationships and customised solutions. The CEO emphasises that despite the COVID-19 pandemic, the company had an excellent year in 2020 thanks to its "multifocal approach". The innovation of vegan wine has transformed several components of the business model, including partnerships and key resources.
Durable Materials
Exclusive use of glass bottles, a recyclable material that can be reused indefinitely
Organic Products
Sale of organic wines without pesticides and a project to obtain a non-GMO certification
Logistical Challenges
Distribution by lorries and container ships with significant environmental impact
Ecological Innovation
Development of a lighter glass bottle to reduce the carbon footprint
The environmental dimension has become a strategic focus for the company. The CEO noted that vegan consumers "seem to be more motivated by sustainability, by preserving the natural environment", thus establishing an interrelationship between the economic and environmental layers of the business model. The company is also collaborating with a local university to develop a non-genetically modified wine certification.
Local Engagement
Active member of the local chamber of commerce and supporter of the region's vineyards, contributing to territorial economic development
Social Initiatives
Participation in the Camino de la Cruz and collaboration with the Rotaract project "A Wine, a Smile" in partnership with the local Rotary Club
Strategic Alliance
New partnership with a century-old winery located in an environmentally sensitive area to preserve the wine-growing heritage
The social dimension of the business model is manifested through strong community engagement. The company has recently modified its social model by establishing a strategic alliance with a century-old winery. This project aims to reorganise the winery, improve control of the historic product, and protect the organoleptic properties while launching quality products.
