Business models Business Model Canvas A business model is a plan defined by a company in order to estimate its expenses and define how it will generate revenue. Innovating in the business model allows finding new ways to create value and exploit it commercially. Business model innovation means thinking differently about how to sell products or services and earn money. The traditional model of selling products or services for a certain price is not the one and only: for instance, Google and Facebook offer free services but still manage to get revenues, Google through sponsored research and Facebook through sponsored publications and targeted advertisings. IKEA is another example an innovative business model that transforms a transactional business (punctual sales of rather expensive furniture) into recurrent sales (regular sales of cheap furniture and decorative items). Business Model Canvas The Business Model Canvas is a tool that can help companies define their business models. This strategic management and entrepreneurship tool initially developed by Alexander Osterwalder allows you to quickly and easily explore the viability of your business ideas by asking yourself questions such as: How will I interact with my customers? What will my distribution channels be? What resources do I need? From where will I get my income? This exercise should be done a number of times to identify which of a company’s potential business models would be the best. At a later stage, the Business Model Canvas can also be used to improve an existing business model and continue to innovate.