These important consequences of the firm’s business model design choice have obvious ramifications for its ability to create and capture value. The stronger the competition implied by the choice of the business model, for instance, the more difficult value appropriation will be. The firm’s revenue model also plays an important role in value appropriation.
A business model is geared toward total value creation for all parties involved. It lays the foundations for the focal firm’s value capture by co-defining (along with the firm’s products and services) the overall ‘size of the value pie,’ or the total value created in transactions, which can be considered the upper limit of the “firm’s value capture potential."
There seems to be, in many companies, an implicit assumption that the short term and long term abut each other, rather than being dovetailed together. But the long term doesn't start at year five of the current strategic plan. It starts right now!
A strategic architecture identifies "what we must be doing right now" to intercept the future. A strategic architecture is the essential link between today and tomorrow, between short term and long term.
It shows the organization what competencies it must begin building right now, what new customer groups it must begin to understand right now, what new channels it should be exploring right nozu, what new development priorities it should be pursuing right now to intercept the future. Strategic architecture is a broad opportunity approach plan.”