This doctoral dissertation (PhD thesis) builds a conceptual understanding of the process of business model innovation in established firms and proceeds to address the question of how changes in the business model can be tracked. In the pragmatist scientific tradition, each of the four papers included is warranted by a practical problem and aims to offer useful guidance to managers. The first paper reviews the classic and more recent literature and conceptualizes a process of business model innovation. The problem it aims to tackle is how to innovate the firm’s business model in response to changes in the business environment and what to be aware of in the process. The business model innovation process is argued to consist of two iterative cycles: search and change. The paper further identifies the forces that can influence the successful outcome of each of the cycles. For business model search, these drivers include the ability to understand the environment, the presence of entrepreneurial people, the commitment of senior management, and the dedication of resources and funding. For business model change, some of the critical factors are the commitment of the firm’s senior management, the involvement of the firm’s middle management and employees, the change implementation process, and the introduction of new technology. The second paper develops a technique to capture business model changes from public sources and to facilitate further analysis of these data. The paper addresses the researcher’s practical problem of how to collect secondary data on changes in a firm’s business model and proposes certain approaches to enable the analytical process. This paper responds to the scarcity of methodological guidance for qualitative data analysis in the business models literature and in case studies in general. The paper further provides a review of contemporary approaches to studying business model change and argues for the sufficiency of secondary data to study patterns of business model change in public firms. The technique can also be of use in iv generating valuable insights for practical strategy planning by offering a way to track strategic moves and longer-term development trajectories of competition, industry peers and acquisition targets. The third paper identifies three strategic directions of business model change that management can consider when planning for growth. The case study of a rapidly growing new technology-based firm in a mature industry demonstrates that a firm can follow one of the three trajectories: (i) enhancing the core business model, (ii) “unlocking the nucleus” inside the core business model, or (iii) expanding beyond the core business model. The first trajectory assumes adding complementary activities to provide complete customer experience. The second trajectory means commercializing the already conducted activities as separate products for new markets. The third trajectory stands for adding unrelated activities resulting in new products for new markets thus turning the firm into a multi-industry conglomerate. The second trajectory is quite a potent option which opens opportunities for new revenues while not departing very far from the current business activities. The fourth paper takes a deep-dive into the corporate annual strategic management cycle. By adopting a design science approach during a year-long field study in a multi-subsidiary firm in the dynamic ICT industry, it develops a new process of revising KPIs (key performance indicators), including the indicators related to business model change. The paper also proposes a general guide for such process design. The decision-making process about which metrics to track, affects what management focuses on during the year. The rather streamlined process outlined in the paper is capable of facilitating swift responses to environmental changes in local markets by establishing new KPIs on an ongoing basis together with the business units on the ground, and thus is of key importance to strategic management of the firm.
Business models and business model innovation are increasingly gaining attention in practice as well as in academic literature. However, the robustness of business models (BM) is seldom tested vis-à-vis the fast and unpredictable changes in digital technologies, regulation and markets. The evaluation of the robustness of a BM raises several issues, such as how to describe the business model in a structured way, how to determine a relevant set of changes to test against, how to assess their impact on business model components, and how to use the results of the assessment to strengthen the business model. In this paper, we propose business model stress testing as a practical approach to evaluate the robustness of business model components. The method builds upon concepts from business model innovation and scenario planning. We illustrate our approach using a case example. Our approach enables testing individual business model components as well as the interrelation between components. The approach visualizes challenges and suggests ways to increase the robustness of BM. The stress testing approach is particularly useful in a stage of business model experimentation, i.e. if a company has to choose between alternative business models or still has to implement the business model. The underlying software tool is openly available for reuse and further development. The paper contributes to futures research literature by delivering the first method that allows to test the robustness of business models against future uncertainties.
Organisations increasingly understand that meeting their sustainability ambitions does not only require new technologies, but innovation on the business model level. To facilitate the design of more sustainable business models, a range of new tools and techniques have been developed. While this resulted in the design of a wide range of promising business models, only very few are successfully implemented. The Cambridge Business Model Innovation Process is a framework developed to guide organisations’ business model innovation efforts and map the necessary activities and potential challenges. In this paper, we introduce the framework and present an exploratory attempt of applying it to a social start-up. The preliminary result of this experience led us to build a comprehensive research agenda that aims at developing tools and processes to help organisations in bridging the design-implementation gap in sustainable business model innovation.
The purpose of this article is an attempt to develop the concept of a business model dedicated to companies implementing technologies of the Industrial Internet of Things. The proposed concept has been developed to support traditional companies in the transition to the digital market. The study was based on the available literature on the impact the Industrial Internet of Things has on the economy and business models.
Business Model Generation is a handbook for visionaries, game changers, and challengers striving to defy outmoded business models and design tomorrow's enterprises. If your organization needs to adapt to harsh new realities, but you donâ€²t yet have a strategy that will get you out in front of your competitors, you need Business Model Generation. Coâ€“created by 470 Business Model Canvas practitioners from 45 countries, the book features a beautiful, highly visual, 4â€“color design that takes powerful strategic ideas and tools, and makes them easy to implement in your organization. It explains the most common Business Model patterns, based on concepts from leading business thinkers, and helps you reinterpret them for your own context. You will learn how to systematically understand, design, and implement a gameâ€“changing business modelâ€“â€“or analyze and renovate an old one.