Difference between business model, business plan, business case

In the world of project management, we navigate a sea of jargon every day. It is not always easy to draw clear boundaries between these terms, especially when they appear with different nuances. Therefore, it is time to look at the differences and similarities of three commonly used and often confused terms: The business model, the business plan and the business case. Anyone involved in project management will have come across these terms. However, it is worth taking a closer look at their meaning to gain a better understanding of their use and context.
The business model, business plan and business case are three important documents that are closely related and complementary. They each have their own functions and objectives, but they complement each other when it comes to creating and running a successful business. To better understand the differences and relationships between these three concepts, it is helpful to place them in the context of the whole business and consider their respective roles in business development.

At the centre of every business is its business model. When starting a business, it is essential to develop a sound business model in order to gain a comprehensive overview of the economic prospects and potential of the new company. The business model revolves around the central question of how the company intends to make money, and thus provides a roadmap for generating profits.
A well-developed business model describes in detail the services or products offered, the target markets, the cost structures and the resources required. An example would be a fast-food franchise concept that is sold to franchisees and lives on their profits. Or consider a company that develops a time-tracking app and generates revenue by selling subscriptions.
Often the business model goes hand in hand with a business model canvas, a visual representation of the business idea that summarises all the important aspects on one page. The business plan, on the other hand, builds on the business model and fleshes out the business goals and strategies. While the business model relates to the whole company, the business case focuses on a specific project or investment within the company and checks that it is in line with the overall objectives.

The business plan is the big brother of the business model and represents a journey into the future success story of the company or start-up. It is the comprehensive and detailed presentation of the vision, goals and strategies that will lead the business to success. The target groups, the unique selling propositions and the potential of the business model are presented in an appealing and well-thought-out business plan.
The plan also highlights the competitive situation by analysing the competition and identifying what makes your business different. The products or services offered are described in detail, and forecasts are made for the company's turnover and development. The business plan has the important task of convincing potential investors, business partners and lenders of the company's prospects for success and future viability.
Unlike the business model, which outlines the basic idea, the business plan is a comprehensive and well-thought-out presentation of all aspects of the company or start-up. The business model is the solid foundation on which the business plan is built and developed. It not only conveys the core idea, but also details the entire process that will lead to commercial success.

The business case is the more precise and focused of the three, focusing on a specific project or investment in the company. It has the important task of providing an in-depth analysis of the economic viability, risks and opportunities, and possible alternatives of a proposed project. The business case has a key role to play in this process, providing decision-makers with a sound basis on which to make decisions, and ultimately providing a clear recommendation for action.
A business case is usually prepared at an advanced stage of a company's development. It is used when existing companies need to make investment decisions or when new projects need to be assessed for suitability and profitability. The business case helps entrepreneurs or project managers determine whether a project or investment makes sense and contributes to the company's overall goal.
The business case is like a clever detective, examining every detail of a project or investment to ensure that it is in line with the business model and the company's objectives. In doing so, it helps to keep the business focused and to use resources efficiently.

To better illustrate the harmonious interplay between business model, business plan and business case, let us look at the chronological order of their creation and application. The entrepreneurial journey usually begins with a creative and forward-looking vision - the business model. This is where the basic idea is born that will later lead to success.
This is followed by the creation of the business model canvas, a concise and clear representation of the business idea. This document acts as a compass, presenting the core elements of the business model in an easy-to-understand and compact form.
With a solid foundation in place, the detailed and comprehensive business plan begins. This is designed to convince potential investors, partners and financial institutions of the company's viability and prospects for success.
Once the business is successfully established and growing, new investment or project ideas will emerge to be integrated into the existing business model. A business case is developed for each of these ideas to support decision making and ensure that each project is in line with the company's overall objectives. This creates a dynamic and synergistic interaction between these key elements, paving the way for success. Once the business is successfully established and growing, new investment or project ideas will emerge to be integrated into the existing business model. A business case is developed for each of these ideas to support decision making and ensure that each project is in line with the company's overall objectives. This creates a dynamic and synergistic interaction between these key elements, paving the way for success.

The business model, business plan and business case are three essential elements of project management that focus on different but related aspects of business success. The business model forms the foundation and encompasses the core idea of a business, while the business plan serves as a detailed roadmap for the implementation of the vision. The business case, on the other hand, analyses specific projects or investments within the company to ensure that they are in line with the overall objectives.
The timing and interaction of these three elements is critical to a successful and forward-looking organisation. Understanding the differences and similarities between the business model, business plan and business case will enable project managers and entrepreneurs to use their resources efficiently, make informed decisions and realise the full potential of their business idea.