Closely related to the concept of strategy is the concept of a company’s business model. A company’s business model sets forth the economic logic of how an enterprise’s strategy can deliver value to customers at a price and cost that yields acceptable profitability. A company’s business model is management’s storyline for how and why the company’s product offerings and competitive approaches will generate a revenue stream and have an associated cost structure that produces attractive earnings and return on investment. The concept of a company’s business model is consequently more narrowly focused than the concept of a company’s business strategy. A company’s strategy relates broadly to its competitive initiatives and business approaches while the business model zeros in on whether the revenues and costs flowing from the strategy demonstrate business viability.

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CORE CONCEPT: A company’s business model deals with whether the revenue-cost-profit economics of its strategy demonstrate the viability of the business enterprise as a whole.

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Farida Shaikh

I like management, hence it is difficult but to manage life, I'm learning management.
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