In the world of business, key activities in the business model canvas show the main things every company does to make money, no matter its size or type. These key activities are the heart of how a company works and plans.
The Business Model Canvas, a tool many companies use, points out how important these tasks are and how they connect with other parts of the business.
Key Activities in Business Model Canvas
Key activities in a business model canvas refer to the main things your business does to make money. This includes day-to-day work, marketing, production, solving issues, and office work.
Your key activities will change depending on the type of business you operate. If you are a web developer, User Interface (UI) design and coding will be key activities. On the other hand, if you are a business coach, problem-solving and customer service are key activities.
When deciding what your key activities are, you’ll think about how you make things, solve problems, and use tools or networks. But when I guide my clients, I suggest another way to think about these tasks.
In the business model canvas, there are different sections, or “blocks”. One of the goals is to find a unique space in the market where there’s less competition. This is often called finding a “blue ocean“. So, when thinking about your key activities, it’s about understanding what makes your business special. This helps you stand out and offer something valuable to your customers.
When figuring out the key activities for your business using the business model canvas, I suggest focusing on certain sections. Even though all sections are important, two of them stand out: your channels and customer relationships. That’s because your key activities connect what you offer to the people you serve.
For example, if we look at Amazon’s business model, a key activity that makes them different from brick-and-mortar retailers like Walmart is related to the evaluation phase of the channels block. By collecting and displaying product review information, Amazon assists the buyer in making a decision among similar products. Since it is not possible to read product reviews at Walmart, collecting and displaying review data is a key activity that helps differentiate Amazon from many of its competitors.
Source: Business Model Analyst, 2023
Another example is when it comes to delivery. Two-day, next-day Prime delivery, and even drone deliveries are shortening the time between purchasing and receiving the product in your hands, making the delivery phase of its channels a key activity to differentiate Amazon from other online e-commerce sites.
The 5 Channel Phases
When it comes to the five phases that make up the channel block of the business model canvas, here are a few sample questions you will want to address when developing the key activities in business model canvas.
- Awareness – How can you create awareness that you have something to sell? Will a key activity involve being accepted as a speaker at your industry’s annual trade show?
- Evaluation – How can you make it possible for a prospect to evaluate your offering before paying? Will a key activity be implementing a 30-day try-before-you-pay option?
- Purchasing – How can you change the way a customer makes a purchase? Will a key activity be to use cameras and artificial intelligence (AI) to eliminate the need for cashiers?
- Delivery – How can you make the way you deliver your product or service unique? Will a key activity be offering free pick-up and delivery services, in comparison to your competitors requiring customers to come to their establishments?
- Customer Support – How can you change the way a customer is treated after the sale is completed? Will a key activity be to offer native-language instructions like Clorox, or to offer an incentive for employees to quit to test their loyalty, like Zappos?
Customer Relationships
Another area where key activities can help your business find its blue ocean is by changing the customer relationship your business has with its customers.
Most stores that sell computer systems, like Best Buy, rely on knowledgeable salespeople, which can vary and be expensive.
On the other hand, Dell chose a different path with the relationship it has with its customers. Rather than rely on a salesperson’s knowledge and a customer’s access based on store hour limitations, Dell uses an online application. By assessing how the customer will use their computer, Dell helps the consumer understand all of their configuration options to build a custom PC. They even provide a running total and a list of special deals, so the customer can do a series of “what-ifs” to build a computer that will meet their unique needs within their budgets.
Will a key activity be to provide an automated service like Dell, a dedicated personal assistant for the life of the relationship like Wells Fargo’s Private Banking Services, or allow customers to be part of your offering with a co-creation option like YouTube?
In conclusion, while examining all of the nine core blocks of your business model canvas may help you define your key activities, there are four primary questions you must ask yourself:
- What key activities do your value propositions require?
- What key activities do your channels require?
- What key activities do your customer relationships require?
- Do you have a clear picture of all the key activities you have to perform to produce your output?
The Importance of Evolution in Key Activities in the Business Model Canvas
Businesses change over time, and so do their key activities. It’s crucial to see that what was a key activity today might not be tomorrow. The digital age has changed how customers act, the tech we use, and the market. So, businesses must always evaluate their key activities in the business model canvas to stay on top.
For example, ten years ago, having a website was a big deal. Now, it’s normal. The key activity today might be making that website work well on phones or adding chat tools to help customers.
Incorporating Feedback Loops
A good way to see if your key activities are still the right fit is by getting feedback. This means asking customers, workers, and others what they think and using that to change your key activities in the business model canvas.
Let’s say you sell things online, and many customers say delivery is slow. Then, making delivery faster is a key activity. But if customers love a part of your product, you might want to do more of that.
The Role of Technology in Defining Key Activities
Technology is big in shaping key activities. With more data, businesses can know what customers want. This information can reveal new key activities.
Also, with more people on social media, looking after your brand online is another key activity. This means seeing what people say about you online and addressing any negative comments.
Embracing the Dynamic Nature of Key Activities in Business Model Canvas
To sum up, the business world keeps changing, and so do the key activities that help a company do well. The Business Model Canvas is a tool that helps businesses see and pick these tasks. Whether it’s changing with new tech, listening to what customers say, or just looking again at what the company does, it’s clear that businesses need to be ready to change.
By always checking and changing the key activities in the business model canvas, companies can make sure they stay up-to-date, do well against others, and meet what their customers want. As technology keeps changing how we do business, companies that keep their key activities updated will do the best. For more insights on business planning and strategies, the U.S. Small Business Administration (SBA, 2023) offers a range of resources on how to create a business plan.