There seems to be pretty good consensus that a business model can be defined as “how a business creates value for its customers and captures value from its customers.”
I have found it helpful as I work with teams, especially in the earliest stages of business conception and formation, to break the business model into these two main functions (value creation and value capture). The operating model is what I call the value creation portion of the business model. The revenue model is what I call the value capture portion. You may have slightly different definitions for those two terms, and that’s okay.
In yesterday’s article I introduced the revenue model. In today’s article, we mostly talk about the operating model. Together, they make up the business model.