Mark W. Johnson · Seizing the White Space
Core vs New
Business Model
Dial in both models across the four boxes. The divergence score tells you whether you need a new model — and how separate it must be from the core.
Core model
New model
Profit formula
Revenue modelHow you charge
Unit margin target% gross margin
Resource velocityAsset turns per year
Overhead intensity1 = lean · 5 = capital-heavy
Key resources
Brand relianceHow much brand drives sales
Technical depthSpecialist skills required
Key processes
Sales cycle lengthTime to close a deal
Primary success metricWhat "winning" looks like
Profit formula gap
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Resource gap
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Process gap
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Overall divergence
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Adjust sliders to see the verdict
Set both models across all dimensions above and the analysis will appear here.
Johnson's three conditions that signal a new model is needed — not just a new product. Rate each one for your situation.
1. The profit formula must change
The new opportunity cannot be profitable under your existing financial model — it needs a different cost structure, margin profile, or resource velocity.
2. New resources and processes are needed
Fulfilling the new CVP requires capabilities, partnerships, or workflows that are alien to — or actively undermined by — your current operations.
3. Different rules, norms, and metrics are required
The success metrics used to run the core business — margin thresholds, pricing rules, sales norms — would kill the new model if applied to it.
Adjust all three signals to get a recommendation.
Once a new model is confirmed, Johnson prescribes three stages — each with distinct goals and timelines — before answering the final integration question.
Stage 1 · 1–3 years
Incubation
Test assumptions early, cheaply, and often. Identify which beliefs about the new model are most critical — and verify them before scaling. Protect it from core business metrics and margin expectations.
Stage 2 · 2–5 years
Acceleration
Standardize processes. Establish the rules, norms, and success metrics that govern the new model — these will differ from the core. The goal is to make it reliably and repeatably profitable.
Stage 3 · 1–3 years
Transition
Answer the key question: can this integrate back into the core, or must it stay separate to survive? Most truly disruptive new models must remain structurally independent.
The three incumbent traps
01
Failing to allocate resources. The core always crowds out the new when they compete for the same budget, headcount, and leadership attention.
02
Cramming new into the existing model. Adapting the new CVP to fit the core's profit formula and margin expectations destroys what makes it different.
03
Impatience for growth. New models typically take 4–8 years and multiple iterations before they contribute meaningful revenue. Most are killed too early.
Key diagnostic question: "What rules, norms, and metrics in our core business stand in the way of the new model?" — That's where the resistance lives, and what must be explicitly protected against.