Abstract:

Although the concept of business model (BM) has long been in management nomenclature but there is paucity in theoretical knowledge of the concept in the existing body of literature in particular in the strand of strategy research as both concepts (BM and strategy) are essentially value-driven constructs. So beyond doubt understanding business models not only helps executives and practitioners to deal with competitive challenges more effectively but also more importantly it is a fruitful area for future research. Drawing upon these facts, this essay performs a systematic objective literature review in order to explicate what business model really is and how it matters in firm’s value system. This conception furthers the modern phase of management thinking by offering a new definition for BM and incorporating this notion into strategic posture of a firm, thus business model and strategy are conceptually aligned to demonstrate how firm value system is shaped. This essay accordingly enriches the current body of literature by providing executives, researchers and all practitioners a new set of insightful points in this growing field of inquiry and extends the frontiers of business knowledge by offering a new definition and composition of business model.