6 Problems with the Business Model Canvas

The entrepreneur’s favourite tool is far from perfect

Adrien Book

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The Business Model Canvas (as shown above and improved based on this article’s recommendations) is famously the “ultimate” tool for business transformation, having been taught in business schools from the US to India for the past 15 years.

The “classical” canvas one finds on Google or Wikipedia is however not without its faults, which have to be taken into account when using this tool to innovate or create a business model. Without being aware of what the framework is missing, an inexperienced entrepreneur could make a major tactical mistake, or miss out on specific advantages within their industry or environment. To avoid this, below are a few pointers to keep in mind when creating a business model canvas.

1. Strategy is not taken into account

Consulting companies have the habit of making young graduates do case study interviews to assess their abilities to become strategy consultants. One of the very first things we look for in a candidate is if they ask “what is the client’s “definition of success”?”.

There is a reason things are done this way : by answering this before anything else, we are able to better inform and frame later discussions around a company’s strategy, as all its actions will (should!) be brought back to the original objective.

Yet, this key aspect is not represented in the “classical” Business model canvas framework. Indeed, the usual BMC will define how a start-up creates and captures value for itself and its stakeholders, but does nothing to define and describes an entrepreneur’s goals, dreams and ambitions.

What the canvas is missing is a section which defines the start-up’s mission statement, to give an idea of the priorities and objectives the entrepreneur has set for themselves; some people are happy to barely break-even, while other seek to indefinitely increase profitability. Others will want to do right by their stakeholders and/or society at large. No good strategy would be complete without these elements.

2. There can be more to profits than costs and revenues

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Adrien Book

Strategy Consultant | Tech writer | Somewhat French