Understanding the Business Model Canvas for Emerging Technology Services Firms Part 1: BMC VS. TBP

As founders of early-stage tech services start to think strategically about their business, they start looking into traditional business plans. They do an off-site (spend the weekend) creating a detailed business plan noting down all their beliefs about the business. They come out feeling accomplished and never look at the document again. This is because the chaotic reality of running a fast-paced tech services business changes too quickly to be expressed as a business plan. Every aspect of the business has too many unknowns. Instead, they should look into establishing a business model canvas.  

Business Model Canvas Vs. Traditional Business Plan

Completeness VS. Flexibility

When we think of solutions, our first instinct is to think, detailed is better. We’d challenge this notion. Yes, detailed indicates better throughout, but it also means it is more brittle. In a highly uncertain environment, this brittleness becomes debilitating. It makes it harder to adapt the plan to the changing reality as you learn more. This means the business plan becomes something that you write once and then put in a desk drawer and forget about it. 

This isn’t as bad as it may sound. There is still a lot of value in creating the business plan and thinking it through. Those thoughts will guide your internal business operations and decisions in the future. But it is likely still to leave your strategy in flux. Instead, a business canvas with a lightweight structure is more amenable to the highly uncertain environment of a startup. It focuses on getting the high-level information in place. This is unlikely to change significantly and will stabilize very quickly. 

Comparing BMC VS. TBP

The Chronological Order: BMC, TBP, and Business Cases

The entrepreneurial journey begins with creating a vision for your business, leading to the formation of a business model canvas. This canvas then provides a framework to further stack on tangible plans in order to achieve the goals set by the company. A detailed business plan is formally developed which is later used as a guide to obtain investments and partners. As the business grows and new projects arise, business cases are created to guide decision-making, enhancing the company's reputation and success in the market. Learn more about this here.

Wrapping Up

While traditional business plans have their own importance, they may not be agile enough for fast-paced, early-stage tech services companies. Business model canvas can be a good tool for aspiring tech entrepreneurs to start mapping out abstract visions into a visually simple yet substantial format. 

Be on the lookout for the upcoming blog as we will get into even more detail on what ETS firm founders need to ask themselves before creating a BMC which is personalized towards their specific tech business. We will also be providing templates along with references for ETS firms as well as traditional tech firms. 

If you haven't yet already, subscribe to our Vixul Blog!