Publisher: The Economist, 2005, 281 pages
This fully updated and expanded edition of the definitive guide to creating business models can be used to evaluate opportunities ranging from a modest business proposal through to a major project.
In the complex world of today in which firms face a variety of strategic and operational choices, spreadsheet models are a crucial support in evaluating business decisions. A business model allows you to test a variety of assumptions and scenarios, and the modelling process itself helps to develop a clearer understanding of the inherent pattern of relationships between the variables and the likely outcomes. Ultimately, it is the judgment of the decision-makers that is crucial — but a well-designed business model is essential in supporting the excerise of that judgment.
This book is aimed at both those who are business modelling novices and those with considerable experience who are keen to improve their business modelling skills. It covers every aspect of the process: defining the model structure and outputs; building the model components covering all the factora that you will or may need to take into account; testing and debugging the model; and, finally, exploring scenrios and using the model to help you come to a business decision.
For anyone who wants to evaluate the potential of a business project or investment, this accessible and practical guide, full of easy-to-follow examples, will prove invaluable.
A very good book on financial spreadsheets and how you make them, why you make them and what you may infer from them.
What can be held against it, is that it is totally tied to MS Excel. But most of the theory presented in the book can be adapted to other spreadsheets as well.