Key Activities

Definition

Key Activities are the most important actions a company must take to operate its business model effectively. They are the critical functions a company must perform to deliver value to its customers and ensure the viability of its business.

5 Must Know Facts For Your Next Test

1. Key Activities are the most important actions a company must take to operate its business model effectively.
2. Key Activities are critical functions that a company must perform to deliver value to its customers and ensure the viability of its business.
3. Key Activities are directly linked to a company's Value Proposition, as they are the essential actions required to fulfill the promised value.
4. Key Activities leverage a company's Key Resources, such as people, technology, and intellectual property, to create value for customers.
5. The specific Key Activities a company must perform depend on the nature of its business and the unique value it aims to deliver.

Review Questions

• Explain how Key Activities are connected to a company's Value Proposition within the Business Model Canvas.
  • Key Activities are the critical functions a company must perform to deliver its promised Value Proposition to customers. They are the essential actions the company must take to create, market, and distribute its products or services. Without the appropriate Key Activities, a company would be unable to fulfill the value it has committed to provide to its target customer segments, making the business model unsustainable.
• Describe how Key Activities leverage a company's Key Resources to create value.
  • Key Activities rely on a company's Key Resources, such as people, technology, facilities, and intellectual property, to function effectively. The company's Key Resources serve as the inputs or enablers for the Key Activities, which transform these resources into the outputs that deliver value to customers. For example, a software company's Key Activities of coding and testing new features would leverage its Key Resources of skilled developers and computing infrastructure to create a valuable product.
• Analyze how the specific Key Activities a company must perform can vary based on the nature of its business and the unique value it aims to deliver.
  • The Key Activities required for a company's business model can differ significantly depending on the industry, product or service offerings, and target market. A manufacturing company's Key Activities may focus on production, logistics, and quality control, while a service-based business may emphasize activities such as customer service, consulting, and project management. Similarly, a technology company's Key Activities may center around research and development, software engineering, and data analysis, whereas a retail business may prioritize activities like inventory management, merchandising, and sales. The specific Key Activities a company must perform are directly shaped by the unique value proposition it seeks to deliver to its customers.

Related terms

Business Model Canvas: A strategic management and lean startup template used to develop new or document existing business models. It consists of nine building blocks, including Key Activities.

Value Proposition: The bundle of products and services that create value for a specific customer segment. Key Activities are essential for delivering the promised value proposition.

Key Resources: The assets required to make a business model work, including people, technology, facilities, equipment, and intellectual property. Key Activities leverage Key Resources to create value.