Besides the presentation of the three components of the business model, I wanted to talk to you about how business models relate to strategy and in particular, to conventional tools and concepts of strategy. As mentioned before, the business model is a rather new concept that we will use in the Odyssey 3.14 approach to explore innovation. The message here is that the business model concept can also be used in addition to more general conventional tools in strategy. The business model concept is indeed an interesting unit of analysis for strategy and is proving to be a valuable tool for strategic thinking. The business model first is an interesting unit of analysis when analyzing players in an industry, that is, competitive analysis. Within a given industry, there can indeed be several types of successful business models. For example, in the airline industry there are low-cost airlines such as Ryanair or Southwest Airlines, and conventional airlines such as Air France or Lufthansa. Using the business model concept is interesting to represent the different players within a given industry, and they can all be profitable. So the business model concept is helpful in the competitor's analysis. Second, the business model can also be a very interesting unit of analysis when analyzing a firm's portfolio. A firm can indeed have one or several business models. We're talking here about corporate strategy, the analysis of the firm’s portfolio of businesses. Elevator companies offer a very good example since they often operate two business models. One for lift manufacturing and new installation and one for elevator maintenance. In the manufacturing and installation business model, the value proposition targets architects and general contractors at the time when they design the building. According to the building's characteristics, elevators are designed, manufactured and installed. That is the value architecture. Since there is manufacturing involved, the capital employed is high, especially compared to the second business model, maintenance. This second business model of an elevator company is maintenance and service. In this second business model, the company is a service provider for any type of elevator and targets facility managers. The value proposition is to make sure that the elevators work. To do so, the value architecture includes a network of service centers to ensure fast repair and limited downtime. Since it is a service activity, capital employed is limited. As we can see in this example, a company can have one or several business models. Finally, besides competitive and portfolio analysis, the business model concept can also be an interesting tool when thinking about one given business of a firm which is called business strategy. Think about it for a minute. If you have a business model, do you have a strategy? Is it the same, or is it different? Well, I would argue that the business model is a helpful tool in strategy, but both are different. A business model is an interesting unit of analysis. But it is just a description of how a company is making a profit, or seeks to make a profit in the coming years. A business model is just one piece of the strategic puzzle. To come up with a strategy, you can start with the existing business model, but you then also have to take into account the overall environment of the firm and its evolution, usually captured in the PESTEL framework. Also, you need to take into account the industry the firm is involved in, usually captured by the Porter's 5 Forces Framework. All those analyses can suggest to you how to improve your existing business model and what target business model you would like to achieve in let's say, three years from now. Strategy is also how you go from the existing to your next business model. So, the point here is that the business model is just an interesting unit of analysis. It is not the strategy itself. Strategy is much broader and not just limited to the business model analysis. I hope this video has helped you to relate business models and other tools and concepts used in strategy. Next, we will dig into the details of the three components of the business model.