My role as KPMG’s Owner Managed Business Leader in Bahrain and as Middle Markets Leader for KPMG’s MESA (Middle East South Africa) region gives me specialised insight into this area of economic activity, and the day’s proceedings covered the key elements for a successful and sustainable business model in today’s changing economic climate.
We based the conference’s activities on the book, “The Business Model Generation” – the handbook for visionaries, game changers, and challengers contending to defy outdated business models and design tomorrow’s enterprises. Each participant received a copy.
The nine building blocks of a business model
- Customer Segments – A business serves one or several customer segments.
- Value Propositions – The business must seek to solve customer problems and satisfy customer needs with value propositions.
- Channels – Value propositions are delivered to customers through communication, distribution, and sales channels.
- Customer Relationships – Customer relationships are established and maintained with each customer segment.
- Revenue Streams – Revenue streams result from value propositions successfully offered to customers.
- Key Resources – Key resources are the assets required to offer and deliver the value propositions and build and maintain customer relationships.
- Key Activities – Performing a number of key activities.
- Key Partnerships – Some activities are outsourced and some resources are acquired outside the enterprise.
- Cost Structure – The business model elements result in the cost structure.
The business model challenge for entrepreneurs and family firms
Through interactive discussions, we explored extremely powerful strategic ideas and tools and gave participants ideas on how to implement them in their own businesses. We examined some of the most common business model patterns in the context of concepts provided by leading business thinkers, and helped participants to reinterpret them for their own circumstances.
Participants learned how to systematically understand, design, and implement a game-changing business model and also how to analyse and renovate an old one. We also enabled them to understand, at a much deeper level, their customers, distribution channels, partners, revenue streams, costs, and their core value proposition.
Participants were further able to share their experiences with their peer group and the challenges they’ve faced in their business, which they found incredibly useful, as most of those involved in these family businesses don’t have somewhere to formally share their concerns and get advice. This led to the decision that KPMG partners should form a club to offer such mentorship.
Bolstering family business in Bahrain
There is a lot of focus on SMEs and family businesses, not specifically in Bahrain, but across the entire Gulf region, and a growing feeling that we need to be less reliant on the oil sector. This requires us to focus on and bolster the private sector. More than 90% of companies fall into this category so government and financial institutions are focusing more on this sector.
This conference, and others like it, bear testament to our focus and dedication to this critical sector for Bahrain’s economy. INSEAD’s Professor Filipe Santos, remarked:
"Entrepreneurial businesses are the backbone of any economy and the greatest source of employment creation. However, building and managing a firm in a global business environment is increasingly difficult.“
Solving customer problems to deliver value
This conference gave owner and managers the space they needed to step back from the complexity of day-to-day business and focus on the essential elements of their business model, which is where they draw their main edge when it comes to competitive advantage. We also helped to equip participants with the skills necessary to clearly communicate these key areas of their business models.
By asking participants what essential customer problem their business aims to solve, and compelling them to consider how their businesses deliver value, those participants were able to look at their businesses from a new perspective, which will give them the insight to find areas to innovate and improve operations.
Not only an indispensable learning experience, the conference also provided the participants with the chance to network and share experiences within their peer groups as well as the opportunity to understand of best practices followed globally by similar companies.