ABSTRACT
This chapter focuses on the first of the five analytical techniques: Business model frameworks. Business model frameworks are the basic structures that spell out the building blocks for acquiring resources and using them to generate, deliver, and monetize customer benefits. They are shared languages that can be used to zoom in on strategically meaningful activities and their consequences for building and using resources to generate, deliver, and monetize customer benefits. The business model builder framework has five principal building blocks: Value proposition, market segments, revenue-cost model, growth model, and capabilities. It captures the core elements of value creation and capture, whether the underpinning activities are novel or conventional. Firms often pursue business model innovation to take advantage of the opportunities and threats of their environments. These opportunities and threats may come in the form of phenomena such as disruptive technologies and long tails of product or factor markets.
