Visualizing Value Creation: A Scholarly Examination of the Business Model Canvas Framework in Strategy and Entrepreneurship

Introduction: Why Business Models Became Central to Strategy

Over the past two decades, the concept of the business model has moved from the margins of strategic management discourse to its very center. This shift reflects broader changes in the competitive landscape, including digitalization, platform-based competition, and the increasing importance of innovation beyond products and processes. Traditional strategy frameworks, which focused primarily on industry positioning or internal resources, proved insufficient to explain how firms create, deliver, and capture value in rapidly evolving markets. Against this backdrop, the Business Model Canvas emerged as a widely adopted framework that translated the abstract notion of a business model into a practical and visually intuitive analytical tool.

This paper explains the Business Model Canvas framework from a scholarly perspective, situating it within business model theory and entrepreneurship research. It argues that the enduring influence of the Business Model Canvas lies not in its ability to predict performance, but in its capacity to integrate diverse elements of value creation into a coherent and communicable structure.

Theoretical Foundations of the Business Model Concept

The Business Model Canvas is grounded in a stream of research that conceptualizes business models as systems of interdependent activities. Rather than equating strategy with competitive positioning alone, business model theory emphasizes how firms orchestrate resources, partners, and processes to create and capture value. This perspective draws on transaction cost economics, the resource-based view, and strategic entrepreneurship, reflecting an interdisciplinary synthesis rather than a single theoretical origin.

Osterwalder and Pigneur’s contribution lies in operationalizing this theoretical complexity into a structured framework. The Business Model Canvas distills the essential components of a business model into interconnected elements that collectively explain how an organization functions. In doing so, it bridges the gap between abstract theory and managerial practice, making business model analysis accessible without sacrificing conceptual depth.

Conceptual Logic and Structure of the Business Model Canvas

The conceptual logic of the Business Model Canvas rests on the assumption that value creation is systemic. No single component of a business model can be fully understood in isolation, as each element interacts with and depends upon others. The framework captures this interdependence by organizing key dimensions of a firm’s activities, customers, resources, and financial structure within a single visual representation.

At a conceptual level, the canvas emphasizes three fundamental questions that underlie all business models. These questions concern who the firm serves, what value it offers, and how it delivers and captures that value. By explicitly representing customer segments, value propositions, and revenue mechanisms alongside operational and relational components, the Business Model Canvas encourages holistic analysis rather than functional silos.

The Business Model Canvas in Entrepreneurship Research

Entrepreneurship research has embraced the Business Model Canvas as a tool for understanding venture creation under conditions of uncertainty. New ventures often lack stable routines, established markets, or clear industry boundaries, making traditional strategic planning approaches ill-suited to early-stage decision-making. The Business Model Canvas provides entrepreneurs with a flexible structure for articulating and iterating their assumptions about customers, value, and operations.

From an academic standpoint, the framework aligns closely with research on opportunity recognition and experimentation. It allows scholars to analyze how entrepreneurs test, refine, and pivot their business models in response to market feedback. The visual and modular nature of the canvas also reflects cognitive processes observed in entrepreneurial decision-making, where complex ideas are simplified and revised through iterative learning.

Business Model Innovation and Strategic Renewal

Beyond startup contexts, the Business Model Canvas has become central to research on business model innovation and strategic renewal. Incumbent firms increasingly face disruption not because their products become obsolete, but because competitors introduce novel ways of organizing value creation and capture. In this context, the Business Model Canvas serves as a diagnostic and design tool that enables firms to explore alternative configurations of activities, partnerships, and revenue streams.

Scholarly work on business model innovation often uses the canvas to compare existing and proposed business models, highlighting shifts in value logic rather than incremental operational changes. By making implicit assumptions explicit, the framework supports strategic dialogue and organizational learning, which are critical for successful transformation.

Methodological Applications in Academic Research

Methodologically, the Business Model Canvas is most commonly employed in qualitative research designs, including case studies, comparative analyses, and longitudinal studies. It provides a common language that facilitates cross-case comparison while preserving contextual nuance. Researchers often use the canvas to map business models at different points in time, enabling analysis of evolution, adaptation, and failure.

In mixed-method research, the Business Model Canvas can inform variable selection and hypothesis development by clarifying relationships among key business model elements. Although the framework itself is not a theory, it supports theory-building by structuring empirical observation and revealing patterns that may warrant further conceptual development.

Critiques and Limitations of the Business Model Canvas

Despite its popularity, the Business Model Canvas has not escaped criticism. One limitation concerns its static representation of business models, which may obscure dynamic processes such as learning, experimentation, and competitive interaction. Although the canvas can be updated iteratively, it does not explicitly model temporal change or causal mechanisms.

Another critique relates to the framework’s level of abstraction. While its simplicity enhances usability, it may also encourage superficial analysis if applied without theoretical grounding or empirical rigor. Additionally, the Business Model Canvas focuses primarily on the focal firm, potentially underrepresenting the role of ecosystems, institutions, and power dynamics in shaping business models. These limitations suggest that the framework is most effective when used in conjunction with complementary theories and analytical tools.

The Business Model Canvas in Contemporary Strategy Scholarship

In contemporary strategy scholarship, the Business Model Canvas occupies a unique position as both a pedagogical device and a research tool. Its widespread adoption reflects a broader shift toward integrative and design-oriented approaches to strategy that emphasize value creation over competitive positioning alone. While it does not replace established strategic theories, the canvas enhances their practical relevance by translating abstract concepts into actionable representations.

For educators, the framework provides a powerful means of engaging students in strategic thinking by encouraging active experimentation and visual reasoning. For researchers, it offers a structured lens through which to examine how firms navigate complexity and change.

Conclusion: The Business Model Canvas as a Sensemaking and Design Framework

This paper has argued that the Business Model Canvas should be understood as a sensemaking and design framework rather than a predictive model of firm performance. Grounded in business model theory and aligned with entrepreneurship research, the framework offers a coherent way to visualize and analyze how organizations create, deliver, and capture value.

Its enduring influence stems from its ability to integrate diverse strategic elements into a single, communicable structure that supports learning, experimentation, and strategic dialogue. When used critically and in conjunction with broader theoretical perspectives, the Business Model Canvas remains a valuable tool for advancing both scholarly understanding and practical application of business models in an increasingly complex and dynamic business environment.

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