The Association of International Certified Professional Accountants invites participation in the CGMA Business Model Framework consultation.
Understanding the business model and its dynamics is crucial for long-term value creation. We believe that the CGMA Business Model Framework will aid this understanding.
The Framework builds upon research carried out over a number of years, including work that supports the development of the International <IR> Framework in conjunction with IFAC (Business Model – Background Paper for <IR>). Creating value for the long term lies at the heart of the Framework.
The consultation aims to help us further refine and enhance the Framework, and ensure its applicability and ongoing relevance. Furthermore, responses will be used to develop practical tools that support long-term value creation.
Understanding the business model is relevant to every sector and organizations of all sizes. Without it, companies won’t be able to adapt to market changes, new technologies, risks, and threats. It is also an essential element of an integrated report, for example, as described in “A Call to Action: Walk the Talk on Integrated Reporting”. The Chartered Institute of Management Accountants’ experience of producing its integrated reports, Powering up for Success and Accounting in Extraordinary Times, helped improve understanding of opportunities, challenges, and resource requirements in the context of the business model. Because of this, last year CIMA published Rethinking the Business Model, a white paper to clarify the concept of business models. The report also introduced the Framework as a tool to aid integrated thinking by connecting the various elements of the business model to improve decision making. The paper also helps board members, senior executives, and finance staff understand, develop, deploy, and report their business model.
Business models are created and developed within the organizational ecosystem, which is made up of markets and society. Both are impacted by technology which not only affects a company’s productivity and efficiency but, through the impact of risks and opportunities, very often is also the reason for competitive advantage or disruption. Therefore, organizations need to understand the interactions within the ecosystems in which they operate and how changes within these networks and relationships might affect the business model in the future.
We are requesting your comments and professional expertise on the various elements of the Framework and its sections:
The consultation period runs until September 6, 2017. More information on how to participate as well as the consultation paper is available online.