In this day of disruptive business models and constantly evolving technologies, businesses are fast finding it a challenge to compete on cost alone. SMEs, in particular, playing the role of middlemen and traders are being sidelined in place of such emerging trends. To top that off, rising costs, a manpower crunch, and global economic slowdown have left many companies grappling to stay afloat in such conditions. Finding a strong need to get out of this fix were some six companies, who embarked on a business model reworking journey with SMF on 19 November 2015.
Launched by SMF’s Singapore Innovation and Productivity Institute (SiPi), the Business Model Innovation (BMI) class was developed to assist companies in relooking their business models. Through seeking innovative means to capture, create and deliver value to their customers, the session also offered insights into how retain competitiveness in the current challenging business climate.
Dr Michael Teng welcoming the business representatives
Kick starting the first of two phases, Dr Michael Teng, Director of SiPi, gave examples of how BMI is already taking place, not only in manufacturing but in various industries as well, including the energy, finance, and transport industry. Case studies of businesses such as AirBnB, and Amazon were shared. While modeling their businesses after these companies will not be practical as different businesses have their unique set of challenge, Dr Teng urged them to learn how they have successfully created a niche in their industry to capture and deliver a unique service or product to the customers.
“What we are witnessing today is an explosion of business model innovation that is not only changing the rules of the game but the entire game itself,” said Dr Teng. It is thus imperative that companies adapt by carefully realigning the organisation.
SiPi’s consultants had a one-on-one session with companies to assist them in mapping out the niche areas of their industry and business
The importance of building a strong corporate culture struck a chord with Ms Joyce Chan, Director of Four Seasons Durians. Facing challenges such as high manpower turnover and downward trend sales, she sees the need for innovating their business model and one way is through instilling a strong company culture in the staff. “Although revenue sustains the company, we have to first establish a strong culture so that our staff will want to stay on. I have to go back and share this idea (with my business partner),” shared Ms Chan. Not everything covered during the session was new to her though. “Although I do know what is good for the company, this class functions as a wakeup call for what I should be doing”, she said.
“We want to know what we can do as a company to progress with the rest of the world and see things in a different light, and see how we can take advantage of the changing technologies and the environment around us. This session has definitely benefited us in terms of the sharing, for example the case studies. These are not what we will normally be exposed to or even think about. It also helps us organise ourselves in terms of planning to have a clearer idea on what our plans should be in future,” said Ms Almy Goh, Marketing and Research Manager, Fong Yit Kaya Pte Ltd.
Participants and Sipi consultants during the launch of the BMI masterclass
The BMI masterclass consists of two phases – phase one is catered for CEOs or senior managers wherein they will be encouraged to identify the gaps in their current business model. This is then followed by the second phase where SiPi’s consultants will engage key staff and draw out a roadmap with milestones, investments, areas for development, and risks involved.