Key Activities of the Business Model Canvas – A Deeper Dive

Organizations are defined by what they actually do. As part of the Business Model Canvas, Key Activities capture what people spend their time day to day in execution of the Business Model.

This post identifies many examples of Key Activities in a wide variety of different types of organizations. The purpose is to help clarify what a Key Activity is, and to give ideas to help spark your thinking.

Where Key Activities Fit in the Business Model Canvas

‘Key Activities’ is one of the nine items that make up the Business Model Canvas. It is the place on the canvas to capture the actionable priorities in an organization. It’s where people spend their time, and what executives are most concerned about. It is on the Execution side of the canvas.

The Business Model Framework is largely credited to Alexander Osterwalder and Strategyzer.  To supercharge your understanding of business models, I recommend his book, “Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers”.

For this post, the focus is on a few of the types of activities that are most prominent in organizations today. Note that this is not just about businesses, or private industries. Business Models are important for government and not-for-profit organizations also, and all are considered here.

The key activity types of focus for this post are:

• Production – everything from how a product or service is produced and delivered to customers
• Problem solving – developing custom solutions for customers and clients; usually project based
• Technology – leveraging technology to provide value added for customers
• Platform or network – building a platform that will provide superior value and competitive advantage
• Sales and marketing – externally facing presence that is necessary and present in most organizations

Note that not all organizations will have activities in each of these activity types. Most will have some dominant types.

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Key Activity Type: Production

Production is a primary activity in organizations that build and sell products. Manufacturing businesses are a prime example. However, most organizations produce something, even if not a primary activity.

Here are five top Key Activities related to Production:

• Design – designing products, machinery, and production processes
• Purchasing – outsourcing materials and other input products
• Build – assembling, processing, and sharing inputs into the desired products
• Deliver – shipping, distributing, and handing off the products to end customers
• Administer – orchestrate, control, and manage the production process

Organizations sometimes outsource all required production as it is not a core activity. In those cases, the outsourcing itself is a Key Activity of the organization.

Key Activity Type: Problem Solving

A consulting organization is a prime example of an organization that solves problems as a core activity. However, many government organizations with certain specialties also solve problems for their internal and external customers.

Here are five Key Activities that fit under the Problem Solving umbrella:.

• Knowledge Management – managing a core shared knowledge base
• Recruitment – identifying, connecting with, and hiring skilled people
• Training – enhancing core skills and integrating people into shared processes
• Interfacing with clients – interacting with those whose problems you are solving
• Writing proposals – detailing scope and cost for future engagements

In addition to for-profit enterprises, many not-for-profits have Key Activities in Knowledge Management and Training.

Key Activity Type:  Technology

With Technology there is a focus on an underlying capability that provide strategic advantage.

The following are example Key Activities related to Technology:

• Research & Development – the capability to develop core technologies, or specific applications
• Development – distinct fr R & D, this can include developing software as part of the offering
• System Administration – support for a technology infrastructure that is required
• Support – helping customers and internal personnel through technology issues
• Recruitment – ensuring a stable of people versed in the core technology

Technology-oriented activities may be a part of businesses in consulting and manufacturing; government organizations that design, develop and manage technologies for government use; and not-for-profit organizations that support people that need technology or professions in technology fields.

Key Activity Type:  Platform or Network

Platforms and network activity have become more pervasive as organizations try to leverage network effects. In such organizations, each participant added to the network increases the value of the network to all participants.

The following are five Key Activities related Platforms and Networks:

• Research & Development – could related to the Network or the Platform, or to a technology that is a common interest of network participants
• Providing Core Expertise – central expertise that attracts participants, builds community, and continually adds value
• Platform Management – technical support, customer service, and provisioning for new customers
• Membership Management – administration, customer relations, and other value added services
• Quality Monitoring – ensuring that security and content quality meet established standards

As there are many types of network effects, there are many sub-areas of interest that may involve additional Key Activities that fall under Platform or Network.

Key Activity Type:  Sales and Marketing

Sales and marketing are critical to most organizations, especially those in private industry. However, it is also a Key Activity Type for not-for-profits in raising money and offering services. It can also be important for government organizations who need to sell internally to customer sin order to obtain the required levels of funding.

• Recruiting – finding people who can sell applies to every organization
• Advertising – making offerings of the organization known in the target market
• Prospecting – continually identifying candidate customers or consumers
• Maintaining – proactively nurturing existing customers and consumers
• Collaborating – coordinating with related stakeholders to create a holistic interaction

Sales and marketing is important to some degree in virtually any organization, whether public or private sector, or for profit or not.

Conclusion

This post looks at an array of ideas for capturing the Key Activities that your organization undertakes, or needs to undertake, to conduct its day to day business. Key Activities are an essential part of executing on the organization’s Business Model.

You can quickly and conveniently work through the Key Activities and other components of the Business Model Canvas with the Lucidchart Business Model Canvas template (Try for free) – recommended!

Importantly, this subject applies to virtually any organization whether commercial for profit, not for profit, startup, or government entity

I would love to hear from anyone from these various organization types about your Key Activities in support of your Business Model. Please share!

To supercharge your understanding of business models, I recommend “Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers” by Alexander Osterwalder.

For a startup-centric presentation of Key Activities of the Business Model Canvas, see “Business Model Canvas: Key Activities” by Startup SOS.

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I recommend these PM templates and strategy resources (paid links):

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