Using Business Models beyond Business

Abstract

Business models describe the way organizations create and deliver value necessary for their existence. In the mid-1990s, they arose as a buzzword relating to the development of “dot-com” firms and their hunt for capital. The theory and application of business models have focused on business.

Consequently, the definitions and archetypes of business models proposed in the extant literature have addressed profit-making organizations. This paper argues that business models are equally useful in the establishment, evolution, and analysis of non-profit organizations. Moreover, there is a real need for these models, as non-profit organizations are part of the national and international economic governance. Thus, the paper reframes business models through a non-entrepreneurial lens and proposes a new archetype with generalized applicability to all organizations, whether for-profit, non-profit, public, or private. A “hybrid” archetype is developed, synthesizing existing business model archetypes while extending their reach to better embrace the overarching core logic of organizations, reflecting the political mandate of not-for-profit entities and the business remit of firms. The validity of the proffered archetype is tested on two international not-for-profit organizations and serves well as a conceptual map of their decision-making and policy-making activity. Furthermore, the testing process demonstrates that business models, when devised externally and retrospectively, can be equally well used in hindsight as organizational analysis tools, possibly conjointly with other methods.