If your team does not agree on this, you’ve got a problem

What is your business model? What aspects of your business approach are non-negotiable, regardless of changes in marketplace, customers, competition or economic environment? If you struggle to answer these questions, and/or disagree with people on your management team, your company could be suffering from a corporate identity crisis.


Consistently successful businesses understand their business model and exercise exceptional discipline in adhering to that model. These businesses know what they stand for, what they bring to the marketplace and for whom. There is no confusion, room for misinterpretation or disagreement. Everyone from the board of directors to the frontline employees understands the business approach and its critical tenets. Sound utopian?
It is more common than you might think. Businesses with business model clarity and discipline exist all around you.


Core management philosophies
The components of your business model are your core management philosophies that capture your strategic principles. Each philosophy describes the non-negotiable aspects of your business approach. The unique combination of these philosophies would clearly and cohesively define your business model.
Core management philosophies are at a much higher level than strategies and tactics. Strategies and tactics are subject to constant change — core philosophies are not. They describe the business model at a fundamental level. If you change your philosophies, you will create a completely different company.


Defining your business model
Ask yourself a series of questions to help you crystallize your business model. Remember, you are looking for those aspects of your business that do not change and are non-negotiable.
What are the specifics about your business approach? Do you focus on a particular industry segment, geographic region or customer type? Do you only focus on a certain product or service type that would define your business? What product attributes do you exclusively target?
If you are an auto manufacturer, are you a low-end, midlevel or luxury brand? If you are a luxury brand, is your focus on delivering the quietest, most comfortable ride, the highest reliability, the best driving experience or some combination of those attributes?
The unique combination of product attributes will define your company. Every aspect of your company, from its competencies and capabilities to its processes and procedures, must align with your core philosophies.
If you are a hospital, are you a general hospital or a specialized center? Is your focus on treating cancer regardless of the age of the patient, or, are you a children’s hospital that will treat kids regardless of their disease?


Stop changing
Who you are, and what you do, must be clearly and explicitly engrained in your organization. You cannot be a cancer center for three years, a children’s hospital for the next two and then switch to focus only on emergency room services.
You could, but that’s when the hospital would have a severe case of identity crisis. It sounds ridiculous that any hospital would do that, and yet, it is amazing how many businesses make the mistake of not understanding their business model and constantly revise it.
They lack discipline. Is your business one of them? ●