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Business model innovation: it's not just about technology anymore

Henry Chesbrough (Executive Director, Center for Open Innovation, University of California, Berkeley (chesbrou@haas.berkeley.edu). He is the author of Open Business Models: How to Thrive in the New Innovation Landscape (Harvard Business School Press, 2006) and Open Innovation: The New Imperative for Creating and Profiting from Technology (HBSP, 2003).)

Strategy & Leadership

ISSN: 1087-8572

Article publication date: 13 November 2007

Abstract

Purpose

To innovate the company business model, executives must first understand what it is, and then examine what paths exist for them to improve on it. This article aims to examine this issue.

Design/methodology/approach

The article provides a practical definition of business models and offers a Business Model Framework (BMF) that illuminates the opportunities for business model innovation.

Findings

The article finds that BMF sequences possible business models from very basic (and not very valuable) models to far more advanced (and very valuable) models. Using the BMF, companies can assess where their current business model stands in relation to its potential and then define appropriate next steps for the further advancement of it.

Practical implications

An organization must give a senior manager the resources and authority to define and launch business‐model experiments.

Originality/value

The article provides a cogent model for assessing the potential for new business model innovation, a framework for carrying it out and a management plan for decision making.

Keywords

Citation

Chesbrough, H. (2007), "Business model innovation: it's not just about technology anymore", Strategy & Leadership, Vol. 35 No. 6, pp. 12-17. https://doi.org/10.1108/10878570710833714

Publisher

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Emerald Group Publishing Limited

Copyright © 2007, Emerald Group Publishing Limited