Utilising strategic management tools such as the Business Model Canvas (BMC)
Under the COVID situation, this tool can be useful to help you revisit your business model again to help you map and develop how your business should operate to get the most out of a unique and uncertain time.
What is the Business Model Canvas?
The BMC is a strategic management template used for developing new and/or documenting existing business models. This visual chart can help you evaluate your current business values, proposition, infrastructure, customers, and finances and help assist you in exploring alternatives for your business operations.
How to use the BMC under COVID
The BMC targets the key elements that harness a successful business model. The right side of this visual chart focusses on your customer base, while the left side focusses on the infrastructure and categorises the processes and internal activities of a business into 9 separate categories:
- Value Proposition: The key foundation to any business. It refers to the benefits that your business brings to your customers, i.e., “why should customers buy from us?”
- Customer Segments: This refers to your target market – the different groups of people or organisations your business aims to reach and serve. Some things to consider could be how can you help your existing customers – is there an existing service or product you can offer, or can it be offered in new ways to help them?
- Customer Relationships: This is defined as how a business interacts with its customers. How do you incentivise customers to make their first purchase? How do you keep repeat customers? How do you upgrade your customers?
- Channels: The means you use to sell your products or services. Are there opportunities to develop new channels to connect with your customers with the ongoing changes to regulations?
- Key Activities: What activities can you and your team undertake to keep your business on top of the ever-changing COVID environment? This sector is important to review regularly, not just in a COVID environment.
- Key Resources: These are assets of the organisation fundamental to how it provides value to its customers. You can look at what are the key fundamentals to keep the business operating as normal and what is not so important. Is there an opportunity here to cut costs or limit unnecessary activities?
- Key Partners: These are your key partnerships such as your network of suppliers, strategic alliance between competitors, joint ventures and so forth. How can you leverage off your existing relationships to keep you operating? What are your competitors doing in the market? It is important to stay informed and understand your industry activity.
- Revenue streams: One of the most important considerations under a changed business environment is to think about how to maintain revenue and generate income under COVID. Are there new markets available for your product/service that wasn’t previously available? Can you move your product/service to a digital platform? What ways can your business keep providing value in new and different ways?
- Cost structure: This is a great opportunity to completely revisit the cost structure of your business and save money where possible.
Every business is impacted differently under the COVID environment, but utilising business tools such as the BMC can help you revisit your business model and help you paint a clear picture for where your business is headed and what alternative choices you can make that may open your business up to new opportunities.
Contact us today if you think your business needs some extra help revising your business model under COVID.