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Business models in strategic management
Business models in strategic management

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2 Types of business models

In order to understand how business models contribute to our understanding of strategy, you will now look at the different types of business models. Several classifications have been proposed. This section looks at the typology of business models proposed by Baden-Fuller et al. (2018).

This typology is based on the way value is created and captured. The process of value creation and capture can involve two parties: in this case the business model is called dyadic. If it involves three parties, the business model is triadic.

The different types are outlined in Figure 1.

Described image
Figure 1 Dyadic and triadic business model types

It is important to note that although the whole idea behind business models comes from for-profit organisations, the same principles are applicable in public and third sectors, since organisations are required to be sustainable in the sense of balancing costs and revenues.