The Business Model Canvas is a tool that illustrates how a business creates and delivers value as well as makes money. However, a Business Model Canvas presents a worm’s eye view of a business so that the context or Environment is not shown on the Business Model Canvas. Nevertheless, the Business Model Canvas (worm’s eye view) and Business Model Environment (bird’s eye view) can be presented on a single page; see page 201 of the book, “Business Model Generation” by Alexander Osterwalder and Yves Pigneur.
In describing the Business Model Environment of the Business Model Canvas, the literature has focused on 4 “Global Forces” of the Macro-Environment: Industry Ecosystem (IE); Market Ecosystem (ME); Key Trends & Complementors (KTC); Macro-Economic Influencers (MEI). However, we have yet to come across a one-page worksheet that simultaneously illustrates the Business Model Canvas and Business Model Environment. Consequently, some people find it difficult to concurrently analyze the fitness between a business model and its environment.
This presentation (http://goo.gl/1uinUW) uniquely presents a modular worksheet that contains the Business Model Canvas and Business Model Environment. Consequently, one can simultaneously analyze a business model and its global environment especially with a view to determining environmental fitness of a business model. Although its boundaries are fluid, the Business Model Environment largely acts as a constraint to the growth of a business model. According to “Constructionists,” a Business Model Environment mostly determines whether a nascent business model thrives or dies. However, “Reconstructionists” such as Blue Ocean Strategists believe that a Blue Ocean business model can create an uncontested market space and subsequently, redefine market boundaries and industries that make competitors irrelevant.
To determine the chances of a business model thriving or dying in an existing industry (Red Ocean), it’s imperative to analyze industry attractiveness especially using Porter’s 5 Forces of Competition or “Industry Forces.” Industry Attractiveness Analysis can be enhanced by combining the diagram for Porter’s 5 Forces and the Business Model Canvas. Such an integrated diagram can be used to determine the competitive advantage of a business model.
In the presentation below, a diagram is presented which seamlessly integrates Porter’s 5 Forces and the Business Model Canvas. The resulting one-page modular worksheet is referred to as the Global Business Model (GBM) Canvas. Note that GBM Canvas also refers to the one-page modular worksheet that combines the 4 Global Forces with the Business Model Canvas. The objective of a GBM Canvas is to provide a single page that facilitates seeing both the big picture and details of a business model. In summary, the GBM Canvas facilitates comprehensive internal and external analyses of a business model.