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OMBA 101 · Unit 2 of 6

Business Models and Industry Logic

Business Foundations and Managerial Thinking

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Learning objectives

After completing this unit, you will be able to:

  • Decompose a business model into revenue, cost, and activity components
  • Compare revenue models and cost structures across industries
  • Calculate and interpret unit economics and contribution margin logic
  • Assess whether a model fits industry structure and competitive dynamics
  • Contrast product, service, platform, and marketplace architectures

Why this matters

Strategy decks talk about vision; operating reality runs on business models. Unit 2 teaches you to read how money and effort flow through a company so you can judge whether growth is healthy, whether a pivot is plausible, and whether industry forces will crush a plan that looks clever on a slide.

Unit overview

Work through the five lessons below in order. Each includes worked examples with numbers where relevant.

#LessonCore idea
1The Components of a Business ModelCustomer, offer, channels, economics
2Revenue Models and Cost StructuresHow money comes in and goes out
3Unit Economics and Contribution LogicPer-unit profit and scaling math
4Business Model Fit with Industry StructureFive forces and model viability
5Comparing Product, Service, Platform, and Marketplace ModelsArchitecture choices and tradeoffs

Connection to applied work

Extend your Unit 1 company map with a business model canvas and a simple unit economics table (even with estimated numbers). This becomes the financial logic section of your applied project and feeds ACC 101 and FIN 201 later.

Practice

  1. Sketch a one-page business model for your anchor company; label revenue streams and major cost buckets.
  2. Estimate contribution margin per unit for one product or customer segment (show assumptions).
  3. Name one industry force (rivalry, substitutes, suppliers, buyers, entry) that most constrains the model today.
  4. Argue whether the company behaves more like a product, platform, or marketplace business.

Knowledge check

  1. What are the core components of a business model?
  2. Why do unit economics matter before chasing revenue growth?
  3. What does "business model fit" mean in industry context?
  4. When does a platform model beat a linear product model?
  5. How does this unit connect to managerial problem solving in Unit 3?

Key takeaways

  • Business models are choices about who you serve, how you earn, and what you must spend.
  • Unit economics expose whether scale helps or hurts.
  • Industry structure filters which models can win.
  • Model type (product vs platform) changes governance, metrics, and risk.
  • Complete all lessons before starting unit assessments.

Unit assessment

Complete each section below. Score 80%+ on the quiz to finish this unit's assessment.

40% applied project35% knowledge checks25% reflections

Exercises

Apply what you learned in this unit with structured practice.

ExerciseApplied practice: Business Models and Industry Logic45 min
Complete a focused practice exercise on **Business Models and Industry Logic**. 1. Choose a real company, product, or situation you know. 2. Apply one core framework from this unit to analyze it. 3. Write your analysis in 300–500 words with a clear recommendation. 4. Cite at least one credible source.

Deliverable

300–500 word analysis document saved to your portfolio under OMBA 101.

Rubric

  • • Framework applied correctly (not just named)
  • • Specific evidence from a real example
  • • Clear recommendation with tradeoffs acknowledged
  • • Professional writing with source citation
ExerciseDrill: Business Models and Industry Logic30 min
Work through the practice problems in the unit lesson without looking at notes. Then check your work against the lesson and write a short reflection: - What you got right - One mistake you caught - One concept to review before the next unit

Deliverable

Problem solutions + 150-word reflection in your OMBA 101 workbook.

Rubric

  • • Attempted all practice items before checking answers
  • • Honest reflection on errors
  • • Identifies a specific review action

Memo / written deliverable

Write a concise managerial deliverable for this unit.

MemoExecutive memo: Business Models and Industry Logic50 min
Write a one-page executive memo applying **Business Models and Industry Logic** to a business decision. **Format (SCR):** - **Situation:** Context in 2–3 sentences - **Complication:** What problem or opportunity exists - **Resolution:** Your recommendation and rationale Maximum one page, 12pt font, no appendix.

Deliverable

One-page PDF memo uploaded to your portfolio.

Rubric

  • • SCR structure is clear in first 30 seconds of reading
  • • Recommendation is specific and actionable
  • • Evidence supports the conclusion (not just opinion)
  • • Concise: no filler paragraphs

Knowledge quiz

Check your understanding before marking the unit complete.

1. On the Business Model Canvas, which discipline separates strong operators from slide-makers?

2. Which value proposition follows jobs-to-be-done logic rather than a feature spec sheet?

3. A subscription coffee box earns $28/month revenue, $9 variable product cost, and $0.81 payment processing. What is monthly contribution margin per subscriber?

4. A SaaS company reports blended CAC of $110 by mixing paid social (CAC $200, 6-month life) and organic (CAC $20, 36-month life). Why is this dangerous?

5. With 4% monthly churn and $18.19 monthly contribution, what is the simple exponential LTV contribution approximation?

6. In Porter's Five Forces, high buyer power most directly threatens which part of the value chain?

7. A marketplace takes 15% of GMV but does not own inventory. Which capture logic best describes this model?

8. A premium airline invests in lounges and schedule reliability while a budget carrier unbundles bags and seats. What does this illustrate?

Next unit: Managerial Problem Solving →