Business model and strategy must be aligned to succeed

SUPER MODELS: Francine Newth, associated professor of management at PC, says that a business model is key to becoming profitable. / COURTESY PROVIDENCE COLLEGE
SUPER MODELS: Francine Newth, associated professor of management at PC, says that a business model is key to becoming profitable. / COURTESY PROVIDENCE COLLEGE

Francine Newth, an associate professor of management at Providence College’s School of Business, has penned a new book, “Business Models and Strategic Management: A New Integration,” as part of a collection of 13 targeted books that has been acquired by university libraries worldwide and also is available as a corporate learning tool.
Newth has extensive experience in teaching strategic business management, including to Prince Alwaleed in Saudi Arabia, and has focused her research on global alliances, corporate strategy, business models and corporate governance.
She is using her book this semester in her capstone seminar in strategy, where student teams run boardroom meetings.

PBN: To whom is this book targeted and why?
NEWTH: Students, managers and executives. Publishing house Business Expert Press targets to executives. They are categorizing these books as textbooks but they are considered applied textbooks, so that if an executive or manager wants to refresh his memory he could quickly look and get a brief overview with enough depth to bring the information to a meeting. I wanted to write a book where I could bring the model at the center when you do a strategic analysis, which really in a way changes the paradigm of how we teach strategy. The model was to target all these audiences. … Many companies are now talking about the business model but we weren’t talking about it in a classroom to the effect that students would adapt a business-model mindset, which is what they need.

PBN: How are business strategy and business models interrelated?
NEWTH: Indeed they are very deeply interrelated and build on one another. The business model drives the strategy. Your business model is how a company needs to operate internally to be profitable. It’s the capabilities you develop, the systems you have, all to deliver on the value proposition, which is the unique idea you have. It’s the internal side. On the external side are your strategies and how you compete. It’s using your model and leveraging all your capabilities.

PBN: Why do you suppose there has been a lack of instructional material on integrating business model and strategy?
NEWTH: The term “business model” emerged in a significant way with the dot-com explosion of the early «constant ****SSLq»90s. The problem was it was all a matter of future expectations with no cash flow or profits in sight, so no one really knew what should be part of the business model. The concept of a business model evolved in academic circles and continues to evolve. It’s difficult to define a new concept. I think the contribution of my book is that it has helped define it a little further.

PBN: What makes your book a valuable teaching tool?
NEWTH: The book is academic, interactive, applied and concise. Interactivity is key to any reading, any teaching, any learning today. If someone doesn’t interact or go through the thinking themselves, they aren’t going to learn. The book is really a way to engage the students. Not only do I describe a concept, I then provide them with real-world virtual scenarios, meaning I bring it into the classroom. If we’re talking about Netflix, though we’re not at Netflix, we’re in a virtual environment of the Netflix boardroom.

- Advertisement -

PBN: Why do companies turn to changing their strategies rather than their business model to meet market shifts? NEWTH: Businesses are driven by the need to increase sales and profits as quickly as they can. Sometimes changing a market strategy is very doable and can have a short-term impact. A fundamental change in the way a company does business is much harder to do.

PBN: So are business models more important to a company’s survival than their strategies?
NEWTH: They are equally important. When companies engage in a strategic review of their performance they should include both. They build on each other because the fundamental question always is: Do we have the capability in our operation to continue to compete, for example, on a low-cost basis and maintain our profit margin?

PBN: You teach Providence College’s capstone seminar in strategy and consulting. What is the main goal for you in instructing these business students who are about to embark on their careers?
NEWTH: What I have to put in their mind is that they have to be continuously thinking about … the impact on the business model. So when they are working, if they have that added dimension, I think they are going to be more successful, productive, engaged and focused, and a lot more impactful in that company. It’s helping them start their careers with an executive thinking.

PBN: Is this new generation of business leaders better prepared than their predecessors in adapting to fast-happening market changes?
NEWTH: I certainly feel they have a propensity to be adaptive, nimble and fast responding given the environment we live in, given their experience with social media and being interactive, being engaged, which are really a part of what millenials want. •INTERVIEW
Francine Newth
Position: Associate professor of management, Providence College School of Business
Background: Newth came to the United States from her hometown just north of Quebec City at age 18. She stayed to work as a human resources analyst at Bank of Boston. After earning her MBA she entered academia, first at the University of Massachusetts Dartmouth and then part time at Providence College. Deciding to commit full time to life as a college educator, she taught for one year at the University of Rhode Island and then went back to Providence College in 1986.
Education: Bachelor’s in political science and history, Defiance College, 1971; master’s in business administration, Providence College, 1980; Ph.D., international management, Nova Southeastern University, Huizenga School of Business and Entrepreneurship, 1995
First Job: Working at her mother’s fabrics store as a teenager
Residence: Cranston
Age: 62

No posts to display