Business Models and Planning Essay Example | Topics and Well Written Essays - 1000 words

Business Models and Planning - Essay Example A business plan is the formal account of the venture’s goals, the rationales as to why the goals are attainable, and the step-by-step process to be used towards reaching the goals. Often, it may also contain fundamental information on the team or the organization trying to reach the set targets and goals. On the other hand, a business model is a description of the ways in which a venture creates, captures and delivers value – either social, economic, or in other form. Business model designing forms a part of the business strategy. The descriptions covered in a business model include the purpose, strategies, offerings, organizational structure, infrastructure, the policies, operational processes and the trading practices to be implemented. The core functions of a business model include the model by which the venture offers value to its customers, attracts customers into paying for the value offered, and the way it converts the payment to profit.1 Discussion From Zott, Am it, and Massa (2010), business models have formed a highly debatable area of inquiry among practitioners and scholars. This is evident from the high number of peer reviewed journals written on the subject – these amounting to 1,177. There has also been an acute rise in the number of practitioner-oriented inquiries, over the same subject. From a careful review of the issues of debate; the issues that scholars and practitioners do not agree upon include a clearly unanimous definition of a business model; the phenomena of importance, with regard to the areas of growth – these including e-business and use of technology, strategy issues like competitive advantage, value creation, and venture performance; and technology management and innovation. Thirdly, there are widespread acknowledgements – that the business model is an area calling for further analysis and that the field reaches beyond the venture. Acknowledgements are further offered on the fact that business mo dels accentuate a holistic, systematic view of ventures and that the activities of the venture act as vital contributors in explaining how ventures carryout business. Lastly, business models communicate the value creation and value capture aspects of a venture. These indicators were collected from a broad-based review of literature on business models, where the evaluation was done from a multi disciplinary approach – utilizing highly developed issues lenses.2 As depicted through a critical analysis of the different literatures and comparing these with other sources on the subject of business models, it was evident that the concept of the business is used to address an array of concerns, across varied contexts and with reference to a variety of management areas. Also, scholars are known to use the same term, â€Å"business model,† to explain and solve a variety of phenomena, including value creation, business types, and value capture by establishments – as well a s how technological innovation operates, towards solving the difficulties presented by the management of business ventures. Further, the lack of consensus in defining the field may be traced to its recent emergence – where conceptual and definitional overlaps and inclusions are bound to exist – especially due to the wide nature of the concept. However, despite the lack of consensus, the importance of the concept of business models include the identification of the importance of emergent business