​Which of the following are considered interlocking elements of a versatile business model?
A. Regulatory support and promoter experience
B. Customer value proposition
C. Financial resources and cost sheets
D. Key resources and processes
E. Profit formula

Choose the most appropriate answer from the options given below:​

Correct option is D

A versatile and comprehensive business model is often framed around four interlocking elements as proposed by Clayton M. Christensen in his work on disruptive innovation and business models. These elements are:

1. Customer Value Proposition (CVP): What problem does the product/service solve and how well it satisfies the needs of the customer?

2. Key Resources: These are the critical assets—human, financial, intellectual, and physical—that the business uses to deliver the value proposition.

3. Key Processes: These are the operational and managerial routines that enable value delivery consistently.

4. Profit Formula: This outlines how the company creates value for itself while delivering value to the customer. It includes revenue model, cost structure, margins, and resource velocity.

Statements B (Customer Value Proposition), D (Key Resources and Processes), and E (Profit Formula) are therefore the accurate components of an effective and integrated business model. These are not just standalone ideas—they interlock and influence each other, making the business model both coherent and adaptive to external changes.

Information Booster:

• Customer Value Proposition is at the heart of any business model. It answers "Why will customers choose us over others?"

• Key Resources include technology, intellectual property, brand equity, distribution networks, and skilled labor.

• Key Processes involve both operational (e.g., manufacturing, supply chain) and managerial (e.g., planning, budgeting) capabilities.

• Profit Formula determines sustainability. It connects pricing, cost drivers, and margins to guide growth strategy.

• The interlocking nature of these elements ensures that if one element changes (e.g., value proposition), the others must align accordingly.

• Innovators like Amazon, Apple, and Uber show how strong business models are not static documents but dynamic systems with interlinked elements.

Additional Knowledge:

• Statement A: Regulatory support and promoter experience
  These are external enablers and founding conditions, not interlocking elements of the business model structure itself. While important, they do not define the design of the model.

• Statement C: Financial resources and cost sheets
  These are part of inputs and tools for management, but not formal elements of the business model’s core structure. Financial resources may support key resources, and cost sheets are tools used under the profit formula—not defining components themselves.

Thus, A and C are important for business planning and execution, but they are not considered core interlocking components of a business model.