There are two distinct approaches on the spectrum of business modeling: "Fat" Business Modeling and "Lean" Business Modeling. Fat Business Modeling include the use of business modeling tools such as Porter's Value Chain and Five Forces; Kaplan & Norton's Balanced Scorecard and Strategy Map; Osterwalder's Business Model Canvas. Lean Business Modeling, which is pioneered by Rod King, has tools such as the Business Model Iceberg and Business Model Strip. The extreme end of Lean Business Modeling is occupied by the tool of the Business Model Strip which uses a graphical approach to business modeling: business models are represented using nodes (dots) and linkages (lines) as well as arrows to indicate dynamic relationships and interactions. A Business Model Strip consists of three engines: Customer Growth Engine, Enterprise Engine, and Value Engine. In the above presentation, the process of Lean Business Modeling is summarized using the example of three major retailers in the US: Wal-Mart, Target, and Costco. Advantages of using Lean Business Modeling include greater simplicity, speed, and fun especially in business model conversations, analysis, and design. In addition, Lean Business Modeling can be used to illustrate business model archetypes. Finally, diagrams of Business Model Strips can be expanded to Business Model Icebergs, Business Model Canvases, Strategy Maps, and Value Chains. Business Model Strips provide flexibility in design as the designer can zoom in and out of specific parts or engines of a Business Model Strip.

1. Lean
Business
Modeling
RETAIL
INDUSTRY:
Wal-­‐Mart
vs.
Target
vs.
Costo
The
Simplest,
Fastest,
and
Funnest
Way
to
Visualize,
Evaluate,
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Design
Business
Model
Engines
Register
at
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to
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Lean
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Modeling.
Lean
Startup
Coach.
Dr.
Rod
King.
rodkuhnhking@gmail.com
&
h;p://businessmodels.ning.com
&
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BUSINESS
MODEL:
MARKET
REVENUE
MODEL
1-­‐Sided
Market
Business
Model
Engine
(Strategy):
Low
Cost
&
Good
Enough
Quality
Job
To
Get
Done
(JTGD):
Obtain
food,
drinks,
and
hard
goods
Asset
(Product)
Sale
Wal-­‐Mart
(Supermarket)
Target
(Supermarket)
Annual
SubscripRon
(Membership)
Asset
(Product)
Sale
+
Annual
SubscripRon
(Membership)
Wal-­‐Mart
(Sam’s
Club)
Costco
(Wholesale-­‐
Supermarket)
Customer
(Payer)
Supplier
(Enterprise)
Service
(Membership)
SubscripKon
Payment
Customer
(Payer)
Supplier
(Enterprise)
Goods
Payment
for
Goods
Customer
(Payer)
Supplier
(Enterprise)
Service
(Membership)/
Goods
SubscripKon
Payment/
Payment
for
Goods/