Here is a definite need for something that enables rigorous prototyping of ideas and strategy, whereby alternatives can be analyzed and their impact on value objectives can be estimated, and whereby strategic planning can be done continuously and dynamically. We will denote this as “Continuous Business Model Planning” (CBMP).
Note that we are not saying that the creative means that people use to shape their minds, such as Business Model Canvas, Strategy Map, and others, aren’t good. They are very good. But the point is: how do we get from ideas to plans that work, and from static means to something that is dynamic, and from very high-level and abstract means to something that really takes the complexity of the new reality into account, in a way that can be handled and comprehended by the business user.
If people want to go beyond this, they can use spreadsheets, or they dig into Enterprise Architecture, or they (let) apply mathematical modeling for optimization or simulation, to find optimum solutions for specific problems. All of these are useful, but should be applied to where they are good at. But none of these really helps further to address the challenge as sketched above. Mathematical modeling is a black box to most people, and works best when applied to well-defined and focused problems. When business people want to find answers to certain questions, they can hire quants that seek answers by making and solving their models. But this does not provide a means for the vast community of business users that want to mold and evaluate their business and business plans continuously. Enterprise Architecture helps to structure the business but requires deep modeling skills to do so, and is less suitable to business people therefore. It also produces static pictures of the business, at a point in time. It is not dynamic. And moreover: Architecture models “do” nothing. They don’t calculate the impact of business changes on value objectives of the business.
Spreadsheets come more close. Most business people are familiar with them. The question is: can spreadsheets serve to support CBMP, given all complexity and challenges of the new business reality? We want to address this question in more detail. But before we do that, we should first understand a bit better what the need is that we have to fulfill.
Spreadsheets are good at calculating things, based on formulas. When many factors play a role, things become complicated very fast however, but this is what spreadsheets do. However, this is not sufficient. VDMbee is looking for a way to continuously morph an ecosystem of business models, whereby impact on value objectives of the business is calculated instantaneously, and we want to do that in a way whereby we can gradually evolve from phase to phase (as-is, to-be, in multiple steps), and whereby we, per phase, can analyze and compare alternatives, etc. We do not want to just write up some formulas and then calculate things, but we want to understand how, both in as-is, and in multiple and emerging phases of to-be, the business works, or should best work, as a value creation and capturing machine. We want to know how the various parts of the business interact or need to interact with each other as well as with parts of the businesses of others, in order to achieve our goals and objectives. This means that something like “value formulas” are not considered in isolation, but as intrinsically interwoven with, or ingrained in, or based on the structure of the business and its relation to the ecosystem. Value creation and value capture has to do with how parts of the business, both intra- and inter-enterprise interact (collaborate). Based on that, and by applying the right resources and capabilities, value is created, exchanged and captured. The worlds of enterprise modeling and strategic planning have to be integrated, in a way that business users can comprehend and handle. We denote this type of modeling with “value delivery modeling”.