What is a Business Model Canvas-Key Activites-Key Partnerships-Cost Structures

BLOCK N°7: Key Activites

Like the Key Resources, the Key Activites is the most important actions the company must take to operate successfully.

Also, they are important to allow the company to:

• Create ValuePropositions,
• Reach Customers Segments,
• Maintain Relationships,
• Earn Revenues.

There are three categories of Key Activites:

• Production: Design, making, delivering,
• Problem-solving,
• Network/Platform: Developing and improving platforms. Exp: Improving website.

Example: iPod Key Activites:

The Key Activites related to the iPod business is:

Hardware design

Marketing

BLOCK N°8: Key Partnerships

 

The Key Partnerships block is the list of the most important suppliers and providers.

We can find four types of partnerships:

1. Strategic: Between non-competitors,
2. Coopetition: Between competitors,
3. Joint ventures: Development of new business,
4. Buyer-Supplier.

The motivation behind partnerships are:

• Economy of scale,
• Risk reduction,
• Acquisition of particular resources.

Example: iPod Key Partnerships:

• Record companies.
• Hardware manufacturer.

BLOCK N°9: Cost Structure

 

This block groups all the important costs incurred to operate a Business Model.

We can distinguish between two kinds of Cost Structure. The first one focuses on reducing the costs wherever possible (Cost-driven). The second one is the Value-driven, where companies are less concerned with costs, instead, they focus on offering  high-value products.

The characteristic of Cost Structures are as follow:

• Fixed costs,
• Variable costs,
• Economies of scale,
• Economies of scope.

Example: iPod Cost structure:

• People,
• Manufacturing,
• Marketing&Sales

iPod Business Moel

Finally

Compiling all of this data and blocks you find a unique Business Model, highly effective to compete in the market even the product is not an innovation.

Below you can find the link to download the Business Model canvas:

Business Model Canavas

For more information read the Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers Book