Flevy Management Insights Q&A
How can businesses ensure alignment between new business models and existing organizational structures and processes?
     David Tang    |    Business Model Innovation


This article provides a detailed response to: How can businesses ensure alignment between new business models and existing organizational structures and processes? For a comprehensive understanding of Business Model Innovation, we also include relevant case studies for further reading and links to Business Model Innovation best practice resources.

TLDR Ensuring alignment between new business models and existing structures necessitates Strategic Planning, Change Management, Culture transformation, and a focus on Operational Excellence and Continuous Improvement for sustainable growth and competitiveness.

Reading time: 5 minutes

Before we begin, let's review some important management concepts, as they related to this question.

What does Strategic Alignment and Planning mean?
What does Change Management mean?
What does Operational Excellence mean?
What does Continuous Improvement mean?


Ensuring alignment between new business models and existing organizational structures and processes is a critical challenge that businesses face in the dynamic market environment of today. This alignment is crucial for the seamless integration of innovative strategies with the core operations of a company, enabling it to stay competitive and responsive to market demands. The process involves a comprehensive approach, encompassing Strategic Planning, Change Management, and Culture transformation, among other aspects.

Strategic Alignment and Planning

The first step in ensuring alignment is through Strategic Planning. This involves a thorough analysis of the current business model, organizational structure, and processes to identify gaps and areas of misalignment with the new business model. According to McKinsey, companies that regularly refresh their strategies through a detailed analysis of their internal and external environments can achieve up to a 60% higher return on investment than those that do not. Strategic Alignment involves aligning the vision, mission, and goals of the new business model with the existing organizational structures and processes. This requires the involvement of leadership at all levels to ensure that the strategic direction is clearly communicated and understood across the organization.

One effective approach is the use of Balanced Scorecards, which translates the organization's strategy into a comprehensive set of performance measures that provide the framework for a strategic measurement and management system. This approach ensures that there is clarity on the strategic objectives and that these are aligned with the operational activities and processes.

Another critical aspect is the alignment of the IT strategy with the business strategy, especially in the context of Digital Transformation. According to Gartner, 70% of organizations that do not align their IT strategy with their business strategy will suffer from operational inefficiencies and lost business opportunities. This highlights the importance of ensuring that the technological infrastructure and capabilities are in place to support the new business model.

Are you familiar with Flevy? We are you shortcut to immediate value.
Flevy provides business best practices—the same as those produced by top-tier consulting firms and used by Fortune 100 companies. Our best practice business frameworks, financial models, and templates are of the same caliber as those produced by top-tier management consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture. Most were developed by seasoned executives and consultants with 20+ years of experience.

Trusted by over 10,000+ Client Organizations
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes, from startups and small businesses to the Fortune 100, in over 130 countries.
AT&T GE Cisco Intel IBM Coke Dell Toyota HP Nike Samsung Microsoft Astrazeneca JP Morgan KPMG Walgreens Walmart 3M Kaiser Oracle SAP Google E&Y Volvo Bosch Merck Fedex Shell Amgen Eli Lilly Roche AIG Abbott Amazon PwC T-Mobile Broadcom Bayer Pearson Titleist ConEd Pfizer NTT Data Schwab

Change Management and Organizational Culture

Change Management is another critical component in ensuring alignment between new business models and existing organizational structures and processes. This involves preparing, supporting, and helping individuals, teams, and organizations in making organizational change. According to Prosci’s Best Practices in Change Management report, projects with excellent change management effectiveness are six times more likely to meet objectives than those with poor change management. The Change Management process includes communication, education, and involvement strategies to facilitate the transition to the new business model.

Organizational Culture plays a significant role in this process. The values, beliefs, and behaviors that constitute the organization's culture can significantly impact the success of implementing a new business model. A culture that promotes innovation, flexibility, and continuous learning is more likely to embrace changes in business models. For example, Google’s culture of innovation and openness has been a key factor in its ability to continuously evolve its business model and maintain its leadership position in the technology industry.

Leadership is also crucial in driving the change. Leaders must be the champions of the new business model, demonstrating commitment and setting the tone for the rest of the organization. They must be skilled in Change Management techniques, able to communicate the vision effectively, and empower employees to embrace the change.

Operational Excellence and Continuous Improvement

Operational Excellence is essential for aligning new business models with existing organizational structures and processes. This involves the continuous improvement of processes, technologies, and capabilities to enhance efficiency, reduce costs, and improve service quality. Lean Management and Six Sigma are examples of methodologies that focus on process improvement and operational excellence. According to a report by Bain & Company, companies that excel in operational efficiency can achieve up to a 25% higher profitability than their competitors.

Continuous Improvement is a key principle in Operational Excellence. It involves the ongoing effort to improve products, services, or processes. These efforts can seek "incremental" improvement over time or "breakthrough" improvement all at once. One real-world example of this is Toyota’s Kaizen approach, which focuses on continuous, incremental improvement. By integrating the Kaizen philosophy into its culture, Toyota has achieved high levels of quality and efficiency, enabling it to align its operations with its strategic objectives effectively.

Performance Management systems also play a crucial role in ensuring alignment. These systems help in monitoring the implementation of the new business model and assessing its impact on the organization. They provide the necessary feedback mechanism to identify areas of misalignment and enable corrective actions to be taken. This ensures that the organization remains on track towards achieving its strategic objectives.

Ensuring alignment between new business models and existing organizational structures and processes requires a comprehensive approach that encompasses strategic planning, change management, and a focus on operational excellence. By addressing these areas effectively, businesses can navigate the complexities of implementing new business models and achieve sustainable growth and competitiveness in the market.

Best Practices in Business Model Innovation

Here are best practices relevant to Business Model Innovation from the Flevy Marketplace. View all our Business Model Innovation materials here.

Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.

Explore all of our best practices in: Business Model Innovation

Business Model Innovation Case Studies

For a practical understanding of Business Model Innovation, take a look at these case studies.

AeroTech Business Model Innovation for Commercial Aerospace Vertical

Scenario: The organization in question operates within the commercial aerospace sector, facing the challenge of adapting its business model to the rapidly changing technological landscape and increasing competitive pressures.

Read Full Case Study

AgriTech Innovation Strategy for Precision Farming in Sustainable Agriculture

Scenario: A leading AgriTech organization specializing in precision farming solutions is at a crossroads requiring business model innovation to stay ahead.

Read Full Case Study

Retail Digital Transformation for Boutique Clothing Chain

Scenario: The organization is a boutique clothing chain specializing in sustainable fashion, facing stagnation in a highly competitive market.

Read Full Case Study

Business Model Revitalization for Specialty Retailer in Competitive Market

Scenario: A specialty retailer in the competitive apparel market is struggling to differentiate itself in the face of online retail giants and changing consumer preferences.

Read Full Case Study

Customer Experience Strategy for Boutique Hotel Chain in Hospitality

Scenario: The boutique hotel chain is at a critical juncture, requiring Business Model Innovation to stay competitive.

Read Full Case Study

Retail Business Model Innovation for Specialty Apparel Market

Scenario: The company is a specialty apparel retailer facing stagnation in a highly competitive market.

Read Full Case Study




Flevy is the world's largest knowledge base of best practices.


Leverage the Experience of Experts.

Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.

Download Immediately and Use.

Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.

Save Time, Effort, and Money.

Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.




Read Customer Testimonials

  •  
    "As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value."

    – David Coloma, Consulting Area Manager at Cynertia Consulting
  •  
    "I have used Flevy services for a number of years and have never, ever been disappointed. As a matter of fact, David and his team continue, time after time, to impress me with their willingness to assist and in the real sense of the word. I have concluded in fact "

    – Roberto Pelliccia, Senior Executive in International Hospitality
  •  
    "I have found Flevy to be an amazing resource and library of useful presentations for lean sigma, change management and so many other topics. This has reduced the time I need to spend on preparing for my performance consultation. The library is easily accessible and updates are regularly provided. A wealth of great information."

    – Cynthia Howard RN, PhD, Executive Coach at Ei Leadership
  •  
    "The wide selection of frameworks is very useful to me as an independent consultant. In fact, it rivals what I had at my disposal at Big 4 Consulting firms in terms of efficacy and organization."

    – Julia T., Consulting Firm Owner (Former Manager at Deloitte and Capgemini)
  •  
    "[Flevy] produces some great work that has been/continues to be of immense help not only to myself, but as I seek to provide professional services to my clients, it give me a large "tool box" of resources that are critical to provide them with the quality of service and outcomes they are expecting."

    – Royston Knowles, Executive with 50+ Years of Board Level Experience
  •  
    "If you are looking for great resources to save time with your business presentations, Flevy is truly a value-added resource. Flevy has done all the work for you and we will continue to utilize Flevy as a source to extract up-to-date information and data for our virtual and onsite presentations!"

    – Debbi Saffo, President at The NiKhar Group
  •  
    "Flevy.com has proven to be an invaluable resource library to our Independent Management Consultancy, supporting and enabling us to better serve our enterprise clients.

    The value derived from our [FlevyPro] subscription in terms of the business it has helped to gain far exceeds the investment made, making a subscription a no-brainer for any growing consultancy – or in-house strategy team."

    – Dean Carlton, Chief Transformation Officer, Global Village Transformations Pty Ltd.
  •  
    "I have used FlevyPro for several business applications. It is a great complement to working with expensive consultants. The quality and effectiveness of the tools are of the highest standards."

    – Moritz Bernhoerster, Global Sourcing Director at Fortune 500



Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.