Nancy Jalbert
Partner | CPA, CA | Business Transformation

With the digital shift, now more than ever, clients are in the driver’s seat. In order to evolve with their needs, a business must be able to innovate.

Clients can access an almost limitless product and service offering, with fierce competition leading to lower prices. The ever-changing business landscape and innumerable uncertainties underscore the need for businesses of all sizes to position themselves to ensure their longevity and development.

  • Do you find that your value proposal isn’t sufficiently distinctive for you to stand out from the competition?
  • Do you feel that your customers’ expectations have changed in recent years and they want to do business differently?
  • Does your business no longer bring in enough income to meet your growth needs?
  • Is technology transforming how your industry does things?

If the answer to any of these questions is “yes”, it’s time for your business to take a close look at its business model to stay competitive.

Adapt or die: How your business model can impact your growth

The fast pace of technological innovations forces businesses to position themselves to deal with the changes, which may have significant short- or medium-term impacts on their industry. It’s clear that the key to success today is no longer a guarantee of success tomorrow. Businesses increasingly need to question their business model.

An Economist Intelligence Unit (EIU) study indicates that 54% of entrepreneurs consider innovation through new business models rather than new products or services as the way to gain a competitive advantage in the future. Why? Because it’s more difficult for competitors to imitate an entire innovation system than just a product or process.

It’s obvious that business sectors are transforming their business models. Examples abound:

  • Airbnb in the hotel industry;
  • Spotify in the music industry;
  • Alibaba in distribution;
  • PayPal with financial transactions, etc.

Even more traditional industries, such as professional services, must review their business models, as we have seen with Raymond Chabot Grant Thornton. The firm recently deployed its e-accounting platform Operiō to meet the needs of its new-generation clientele.

Competition may not necessarily be found where it was expected in the past. The intermediaries have changed, bringing new opportunities to reach customers. You have to ask yourself: how can your business model help you maintain or even find new sources of income in a constantly changing marketplace?

Changing your business model

Let’s start by defining a business model. There are various definitions, but most agree that it describes how a business will create, deliver and capture added value for its customer base and generate income.

The first question to ask is how you can create value for your customers and then, how you can organize your business to deliver that value, whether it’s through your business processes, resources, value chain, business partners, etc. There are multiple possibilities for business model innovation: expanding your service offering with new upstream or downstream activities, adding a complementary product to your offering, creating value to ensure loyalty, etc.

A number of factors must be considered for a successful, innovative transformation of your business model.

Know your customer
Business model innovation is based, first and foremost, on your knowledge of your customers, their needs, their expectations and, especially, the value they are looking for in a product or service like yours.

Your model should not be based on what you think. You may have a biased view because of your industry perceptions or history. Take the time to consult your customers to get an accurate and up-to-date picture. Plan and conduct customer surveys or hold discussion groups.

Ensure strategic monitoring
New ideas are not the only source for new business models, you can often draw inspiration from models in other industries that could be applied to yours.

Take the time to analyze similar sectors to understand business model best practices and validate their relevance for your business. Consider benchmarking your market to identify the most appropriate business models for your business, or analyze your competition to evaluate positioning opportunities or business models that could set you apart.

Work in synergy
A new business model has repercussions throughout your business’s ecosystem. All functions (human resources, operations, marketing, finance, etc.) will be called upon and will have to evolve at various levels to ensure the new model’s value creation.

Business model innovation requires working with multidisciplinary teams, representing all of the business’s stakeholders. Consider organizing brainstorming workshops led by experts to build consensus. This will foster a common vision of the project and define individual roles in the initiative.

Manage change appropriately
As mentioned, implementing a new business model can lead to extensive changes due to the numerous operational projects to be implemented (IT, artificial intelligence, process optimization, etc.). It’s important to be committed and to manage the change to ensure employee, customer and business partner buy-in. The operational projects must be properly structured in order to implement them efficiently.

Are You Ready to Innovate? Our Experts Can Help!

A business model innovation initiative must be supported by knowledgeable, experienced experts who can help you undertake a strategic reflection of your business’s fundamental makeup to offer a distinctive value proposal that provides a unique and durable competitive edge … until the next transformation!

Our business strategy and organizational performance teams can help you structure your transformation project and provide support to properly manage the change underlying the new business model.

Contact us!

Did you know?

There are scientific research and experimental development investment tax credits available. The scope of these programs may have been curtailed in recent budgets, but they are still one of the most generous sources of financial assistance in the country. In some cases, combined Canada/Quebec credits can be as much as 70% of expenses.

19 Apr 2018  |  Written by :

Nancy Jalbert is a partner at Raymond Chabot Grant Thornton.

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Technological development makes it possible to collect a wide range of useful data. Thanks to artificial intelligence (AI), businesses can capitalize on a focussed and relevant analysis of this information.

The answer to tangible and complex business issues can be found in corporate data. Analytical solutions to problems are a means of optimizing both finances and productivity.

Improved productivity

The productivity of onsite resources can be increased by including algorithms in the decision-making processes. In the manufacturing sector, for example, algorithms make the advanced detection of breakdowns in the production chain possible or can be used for the automated sorting of compliant products.

These solutions rely on data provided by industrial sensors that are currently in place or by low-cost devices, such as cameras or specific sensors that can be installed after the fact. Other applications, such as predictive maintenance, make it possible to boost the efficiency of physical and financial resources used in a manufacturing environment.

Clients in the financial and professional services sectors use algorithms to automate low added-value processes. For example, character recognition can be used to automate data entry.

Algorithmic analyses of financial market results, news and annual reports make it possible for a portfolio management team to prioritize its research work. In the logistics and distribution sector, analysing changes in inventory levels and client demands helps organizations use their storage space more efficiently to reduce inventory shortages and customer dissatisfaction.

Income growth

The data produced can be used to develop solutions that assist departments making strategic and tactical decisions to generate new income. Improved knowledge about clients and their behaviour can be used, for example, to develop initiatives to get their attention and thus meet their needs.

Our AI expertise is leveraged by manufacturing entities to improve their knowledge of clients and detect business opportunities by analyzing past activities and the history of interactions with clients. Analytics are then used to pinpoint where irritants are generated in the client experience or to detect opportunities for cross-sales or supplementary services.

Additionally, thanks to transaction histories and external data cross-checking, clients can be targeted individually during their life cycle. Predictive models can then be used to increase the conversion rate for acquisitions and cross-sales, foster client engagement and reduce attrition rates.

Depending on the available data, these models will identify clients who require special attention. If you know which clients have a high risk of leaving the organizations in the coming weeks, what could be better than preparing a retention offer and acting before they make their final decision?

With this income protection initiative, supported by the analytical component, retention efforts can be invested in the most strategic areas. Similarly, predictive models for product and service cross-sales can be developed to target clients with a strong propensity to convert and thus increase revenues.

Improved client experience

AI can also be applied to improve the client experience. In recent years, the digitized client relationship has significantly changed client expectations in terms of service time, quality and accessibility. Clients want products and services more quickly, they want businesses to be attentive to their needs at all times and they want quality at a lower cost.

In the manufacturing sector, an optimized production line can then reduce production times by anticipating equipment or resource issues, reduce client wait times by anticipating demand and optimizing procurement and improve quality by automating parts of the quality assurance process and controlling input factors. Naturally, similar applications can be implemented in other industries.

AI allows a business to exploit the quantity of data it generates in order to optimize and meet specific business needs. Although it can be used in various situations, it’s important to use it, first and foremost, to support the entity’s mission and bottom line, that is, increase revenues, reduce costs and improve the client experience. Integrating it into a business strategy calls for vigilance.

Our artificial intelligence experts can help!

Did you know?

There are scientific research and experimental development investment tax credits available. The scope of these programs may have been curtailed in recent budgets, but they are still one of the most generous sources of financial assistance in the country. In some cases, combined Canada/Quebec credits can be as much as 70% of expenses.

PME Innovation and technologie - RCGT

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In this second article on personal taxes, here are the developments that will affect you when you prepare your income tax returns.


For federal purposes:

  • Did you buy a first home or condo this year? Make sure you claim the $750 non-refundable tax credit to which you’re entitled. Unlike the taxes, this is a nice way of welcoming you to your home!
  • A quick reminder to help you avoid pitfalls. If you sold your residence in 2017, you will need to provide the Canada Revenue Agency with various information. Should you omit to do so, you will not be entitled to the principal residence exemption and any profit gained (called capital gain) will be taxable. All residential sales must be reported to the tax authorities.

For Quebec purposes:

  • If you were a victim of the floods that occurred in the spring of 2017, a new refundable tax credit of up to $18,000 has been introduced. This is a two-part credit, where the first instalment of up to $3,000 corresponds to 30% of cleaning and preservation expenses exceeding $500. The second part of up to $15,000 corresponds to 30% of repair expenses paid before January 1, 2019 for work performed by a qualified entrepreneur to repair flood damage.
  • You finally put in new windows because their insulation was no longer effective. Good news: the Réno-Vert program has been extended until March 31, 2018. You could obtain a refundable tax credit of up to $10,000 for eco-friendly repair work done to your home or cottage.
  • A new refundable tax credit for the upgrading of residential waste water treatment systems is available, up to a maximum of $5,500. If you incurred expenses for work related to a system for the discharge, collection and disposal of waste water, toilet effluents or greywater in your residence or cottage, this credit is for you.


Seniors and retirement

For Quebec purposes:

  • If you’re a senior still in the work force and your salary exceeds $5,000, you could be eligible for the non-refundable tax credit for experienced workers aged 63 and older. Since the eligible age has decreased, you could obtain a credit of up to $600 if you’re 63 years old, $900 if you’re 64, and $1,200 if you’re 65 and older.



For Quebec purposes:

  • After several years of reductions, the health contribution has been abolished regardless of your level of income.
  • The maximum contribution to the Quebec public prescription drug insurance plan that you must pay when filing your 2017 income taxes has increased from $660 to $667.



Better knowledge of the deductions and tax credits available will help you maximize your income tax return.

  • Note that the tax authorities will not grant you the deductions or tax credits to which you are entitled if you forget to claim these. They have no obligation to do so.
  • Consult the 2017-2018 Tax Planning Guide, a Raymond Chabot Grant Thornton tax tool that will help you plan your taxes.

Read the first article about 2017 income taxes here.

This article was published in French in Journal de Montréal and Journal de Québec on 2018, April 4th.

Visit taxō, a simple online tax return service with experts that help you quickly maximize your tax credits.

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Online Tax Strategies, April 2018: Netflix Tax in Quebec

Effective January 1, 2019: certain non residents of Quebec in the E-commerce sector will be required to register for QST

Quebec Finance Minister Carlos J. Leitão delivered his 2018-2019 Quebec budget speech on March 27, 2018. The new measures proposed include extending the obligation to register for and collect Quebec Sales Tax (“QST”) to certain foreign suppliers in the e-commerce sector.

Currently, there are no specific rules under the QST system for online sale transactions and, accordingly, the general rules apply. As a result, non-resident suppliers who only make e-commerce sales are not required to collect QST if they do not carry on a business in Quebec.

Generally, the new measures will require these non-residents to register for and collect QST on transactions with specified Quebec designated consumers, that is, recipients who usually reside in Quebec and are QST non-registrants. The concept has commonly been called the “Netflix tax”.

The new requirement will apply to non-resident suppliers, whether or not they are located in Canada. The new measures will also apply to suppliers of digital property and service distribution platforms. The proposed measures are summarized herein.

Download the document below.