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Article
Publication date: 13 November 2007

Edward Giesen, Saul J. Berman, Ragna Bell and Amy Blitz

The purpose of this paper is to find out what exactly the term business model innovation encompasses and what type yields the best results.

Abstract

Purpose

The purpose of this paper is to find out what exactly the term business model innovation encompasses and what type yields the best results.

Design/methodology/approach

IBM Consulting researchers first identified the main types of business model innovation, which can be used alone or in combination. They then compared these three types of business model innovation across 35 best practice cases.

Findings

The study found that all new business models can be classified into three types: innovations in industry models; in revenue models and in enterprise models. A key finding was that each type of business model innovation, with the right strategy and strong execution can generate success.

Practical implications

Researchers found that while network plays are being used by diverse companies in different industries and regions and of varying age, size and other characteristics, this tactic has been a particularly useful strategy for older companies.

Originality/value

The study found that best business model innovation strategies provide a strong fit between the competitive landscape for a particular industry and the organization's strengths, shortcomings and characteristics such as age and size.

Details

Strategy & Leadership, vol. 35 no. 6
Type: Research Article
ISSN: 1087-8572

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Article
Publication date: 29 June 2021

Jordana Marques Kneipp, Clandia Maffini Gomes, Isak Kruglianskas, Francies Diego Motke and Kamila Frizzo

This study has aimed to analyze the relationship between the adoption of sustainable innovation practices and the degree of innovation of business models in Brazilian…

Abstract

Purpose

This study has aimed to analyze the relationship between the adoption of sustainable innovation practices and the degree of innovation of business models in Brazilian industrial companies.

Design/methodology/approach

The study has been characterized as quantitative and comprised the conduction of a survey with Brazilian industrial companies.

Findings

Results have shown that companies with a high degree of innovation in their business models invest more strongly in strategic dimensions of sustainable innovation, which in general involve stakeholders and cross the organization's internal boundaries, requiring proactive attitudes from the company, probably because this type of investment gives them greater competitiveness in their market and also requires a radical modification of their business model.

Practical implications

This study seeks to present contributions to entrepreneurs and policy makers, in the face of the innovative and sustainable challenges imposed by society and the guidelines for sustainable development in order to reflect on positive impacts on local and global development.

Social implications

Comprehending the behavior of industrial companies in Brazil in relation to sustainable innovation and its impact on society contributes to understanding the benefits of adopting a strategic management of sustainable innovation, minimizing negative socio-environmental impacts.

Originality/value

By analyzing the themes of sustainable innovation and business model, the present study may contribute to adopting business behavior that strategically and systemically integrates the objectives of sustainable innovation.

Details

World Journal of Science, Technology and Sustainable Development, vol. 18 no. 3
Type: Research Article
ISSN: 2042-5945

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Article
Publication date: 13 November 2017

Adji Achmad Rinaldo Fernandes and Solimun

This research aims to examine the moderating effect of strategic orientation on the effect of environmental uncertainties on business performance and the moderating effect…

Abstract

Purpose

This research aims to examine the moderating effect of strategic orientation on the effect of environmental uncertainties on business performance and the moderating effect of innovations on the effect of environmental uncertainties on performance of the business in the aviation industry in Indonesia.

Design/methodology/approach

Research data were collected in stages by means of interviews with corporate leaders of Indonesian airlines and branch managers of several airports, as well as with the Directorate of Civil Aviation as the regulator. A pre-test and focus group discussion (FGD) were conducted to directly determine the questionnaire aspects of the research object, following which an immediate revision was made to the questionnaire. The data from the survey used in each variable were obtained from the mail questionnaire survey. The data collected using the survey are the main data used in the present study.

Findings

The model of environment–strategy–performance (ESP) can work well in improving performance if supported by innovations. These findings deepen the ESP paradigm in the aviation industry (Miles and Snow, 1978; Segev 1987; Covin and Slevin, 1989; Miller and Shamsie, 1996) that during conditions of high environmental uncertainties, strategic orientation, rather than a single response, will be effective if supported by innovations that provide the strategy with flexibility. The initial implications of these modeling results generate the findings that the effect of environmental uncertainties in the aviation industry (classified as strictly regulated) on performance of a company is largely determined by the direction of the strategic orientation and the innovation level.

Research limitations/implications

Interactions between innovations and environmental uncertainties have a significant negative effect on the achievement of business performance of the branches with a coefficient of 0.02 and a t-value of 2.00, meaning that the innovation level of a branch has an increasingly stronger influence on the business performance of the branch in the uncertain environment with limitations or underestimated by the branch manager or the innovation level of the branch is not supported with airport facilities and services, which means that the provision of airport facilities and services is inversely proportional to the needs of the airline branches. In other words, the variable “innovations” is a moderating variable for the effect of environmental uncertainties on business performance.

Practical implications

The results of the modeling performed in this research also show that innovations play a major role in the implementation of the ESP model (Blumentritt and Danis, 2006). The empirical phenomena and descriptive analysis results suggest that the Indonesian airlines which have been quite successful and have demonstrated an above-average performance possess higher levels of innovations. This finding corroborates that of previous studies that environmental uncertainties and direction of strategic orientation will determine the ability of a company to overcome the barriers to innovations, by maximizing innovative resources in achieving the target of innovations (Manu, 1992; O’Regan and Ghobadian, 2005; Hult et al., 2003), and more specifically, it indicates that strategic orientation that is prospective in nature leads to a high level of innovations (Salavou et al., 2004).

Social implications

The research findings indicate that innovations have a central role in the ESP models and are able to offer a new concept as a modification of the ESP model which in the study is called ESIP. The role of innovations in the ESIP model puts innovations as a variable moderating the effect of environmental uncertainties on performance and the effect of strategic orientation on performance. Moreover, based on the summary of the results for the analysis of the ESIP model, the following can be explained: first, environmental uncertainties have a significant and positive effect on the innovation level or the higher the level of environmental uncertainties, the more is the number of the innovations that an Indonesian airline branch creates. External environmental conditions that are likely to be complex and dynamic found in the area of operations make the branch management more able to identify barriers to innovations and manage resources to be more creative and productive for the attainment of the targets of innovations.

Originality/value

Innovations in business models as a new effort in improvisation specific to the business stage of the basic model (not very valuable) become more advanced business processes to produce products that are more valuable for consumers, at a more efficient cost with better profitability (Chesbrough, 2007b). So far, research on the role of innovations in response to environmental uncertainties and implementation of strategies to improve the performance of the ESP model is still done partially, so that there is no comprehensive model to describe the role of innovations in this ESP model, or let us say that a gap exists between theories and opportunities to conduct further research on the role of innovations in the ESP model.

Details

International Journal of Law and Management, vol. 59 no. 6
Type: Research Article
ISSN: 1754-243X

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Article
Publication date: 8 June 2021

Phuc Hong Huynh

Digital innovation and circular business model innovation are two critical enablers of a circular economy. A wide variety of digital technologies such as blockchain, 3D…

Abstract

Purpose

Digital innovation and circular business model innovation are two critical enablers of a circular economy. A wide variety of digital technologies such as blockchain, 3D printing, cyber-physical systems, or big data also diverges the applications of digital technologies in circular business models. Given heterogeneous attributes of circular business models and digital technologies, the selections of digital technologies and circular business models might be highly distinctive within and between sectorial contexts. This paper examines digital circular business models in the context of the fashion industry and its multiple actors. This industry as the world’s second polluting industry requires an urgent circular economy (CE) transition with less resource consumption, lower waste emissions and a more stable economy.

Design/methodology/approach

An inductive, exploratory multiple-case study method is employed to investigate the ten cases of different sized fashion companies (i.e. large, small medium-sized firm (SME) and startup firms). The comparison across cases is conducted to understand fashion firms' distinct behaviours in adopting various digital circular economy strategies.

Findings

The paper presents three archetypes of digital-based circular business models in the fashion industry: the blockchain-based supply chain model, the service-based model and the pull demand-driven model. Besides incremental innovations, the radical business model and digital innovations as presented in the pull demand-driven model may be crucial to the fashion circular economy transition. The pull demand–driven model may shift the economy from scales to scopes, change the whole process of how the fashion items are forecasted, produced, and used, and reform consumer behaviours. The paths of adopting digital fashion circular business models are also different among large, SMEs and startup fashion firms.

Practical implications

The study provides business managers with empirical insights on how circular business models (CBMs) should be chosen according to intrinsic business capacities, technological competences and CE strategies. The emerging trends of new fashion markets (e.g. rental, subscription) and consumers' sustainable awareness should be not be neglected. Moreover, besides adopting recycling and reuse strategies, large fashion incumbents consider collaborating with other technology suppliers and startup companies to incubate more radical innovations.

Social implications

Appropriate policies and regulations should be enacted to enable the digital CE transition. Market patterns and consumer acceptances are considered highly challenging to these digital fashion models. A balanced policy on both the demand and supply sides are suggested. The one-side policy may fail CBMs that entail an upside-down collaboration of both producers and consumers. Moreover, it is perhaps time to rethink how to reduce unnecessary new demand rather than repeatedly producing and recycling.

Originality/value

The pace of CE research is lagging far behind the accelerating environmental contamination by the fashion industry. The study aims to narrow the gap between theory and practice to harmonise fashion firms' orchestration and accelerate the transition of the fashion industry towards the CE. This study examines diverse types of digital technologies in different circular business models in a homogeneous context of the fashion industry with heterogeneous firm types.

Details

International Journal of Productivity and Performance Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1741-0401

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Article
Publication date: 3 June 2021

Yuran Jin, Shoufeng Ji, Li Liu and Wei Wang

More and more enterprises have realized the importance of business model innovation. However, the model tools for it are still scarce. There is a clear research gap in…

Abstract

Purpose

More and more enterprises have realized the importance of business model innovation. However, the model tools for it are still scarce. There is a clear research gap in this academic field. Therefore, the aim of this study is to put forward a visual business model innovation model.

Design/methodology/approach

The scientific literature clustering paradigm of grounded theory is used to design business model innovation theory model (BMITM). BMITM and the business model innovation options traced back from 870 labels in the grounded process are integrated into a unified framework to build the business model innovation canvas (BMIC).

Findings

BMIC composed of three levels and seven modules is successfully developed. 145 business model innovation options are designed in BMIC. How to use BMIC is explained in detail. Through the analysis of innovation hotspots, the potential business model innovation directions can be found. A new business model of clothing enterprises using 3D printing is innovated with BMIC as an example.

Research limitations/implications

Compared with the previous tools, BMIC owns a clearer business model innovation framework and provides a problem-oriented business model innovation process and mechanism.

Practical implications

BMIC provides a systematic business model innovation solution set and roadmap for business model innovation practitioners.

Originality/value

BMIC, a new tool for business model innovation is put forward for the first time. “Mass Selection Customization-Centralized Manufacturing” designed with BMIC for the clothing enterprises using 3D printing is put forward for the first time.

Details

European Journal of Innovation Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1460-1060

Keywords

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Book part
Publication date: 16 December 2016

Tamami Komatsu, Alessandro Deserti, Francesca Rizzo, Manuela Celi and Sharam Alijani

The chapter provides empirical research results on the peculiarities of social innovation and the specific features that its business model must support. It concludes by…

Abstract

Purpose

The chapter provides empirical research results on the peculiarities of social innovation and the specific features that its business model must support. It concludes by proposing a Social Innovation Business Model Canvas and steps towards Social Innovation typologies.

Methodology/approach

The research is based on the results of a comparative analysis of 25 business case studies and 32 biographies conducted within the SIMPACT research framework. We then implemented a process of reverse engineering to uncover the business models behind the cases which facilitated the creation of a typology for different social innovation business models. Reverse engineering is the application of tools and processes used to study new business ventures in comparison with existing ones. As such, it sheds further light on the broad characteristics of social business models and their value creation mechanisms. The evidence coming from the cases were analyzed within a new business model and clustered to identify a typology of business models of social innovations.

Findings

The main SIMPACT findings, resulting from the reverse engineering process and upon which our discussion is based, can be seen in the following distinguishing characteristics of SI business models. SI business models are: configured around finding complementarity between antagonistic assets and seemingly conflicting logics; often structured around a divergence in the allocation of cost, use, and benefit leading to multiple value propositions; modeled on multiactor/multisided business strategies, and developed as frugal solutions and through actions of bricolage. Four typologies of social innovation were identified: beneficiary as actor, beneficiary as customer, beneficiary as user, and community-asset-based models.

Research implications

While much attention has been placed on for-profit business models, there is little literature on social/not-for-profit business models. This chapter can add to this gap by providing substantial empirical evidence.

Practical implications

Practitioners in the field of social innovation, particularly the growing intermediary sector, could integrate the findings of the research in their work.

Social implications

The work is also leading to the construction of a future business toolbox for social innovation, which will be even more useful for incubators, accelerators, and supporting structures.

Originality/value

Research presented in this chapter is the result of an extensive comparative analysis across all of Europe, including examples of failure, and the first to propose a typology of SI Business Models.

Details

Finance and Economy for Society: Integrating Sustainability
Type: Book
ISBN: 978-1-78635-509-6

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Book part
Publication date: 30 November 2020

Ksenia Podoynitsyna, Yuliya Snihur, Llewellyn D. W. Thomas and Denis A. Grégoire

We investigate how Salesforce’s key people used analogies and metaphors during the deployment of their (then) radical business model innovation. Our analysis shows how…

Abstract

We investigate how Salesforce’s key people used analogies and metaphors during the deployment of their (then) radical business model innovation. Our analysis shows how Salesforce’s entrepreneurial team skillfully used a mix of analogies and metaphors to communicate its innovations and differentiate the company from its competitors. We also show how business model innovators can weave together analogies and metaphors to create distinct meta-narratives that elicited strong emotions and helped construct a memorable organizational identity that galvanized stakeholders around the firm’s ecosystem appeal. We conclude by discussing the implications of our findings for business model and cognition research.

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Article
Publication date: 25 November 2020

Makhmoor Bashir, M. Muzamil Naqshbandi and Rayees Farooq

The purpose of this paper is to systematically analyze the literature on business model innovation by identifying its triggers, enablers, barriers, dimensions, outcomes…

Abstract

Purpose

The purpose of this paper is to systematically analyze the literature on business model innovation by identifying its triggers, enablers, barriers, dimensions, outcomes and highlight avenues for future research.

Design/methodology/approach

A systematic literature review of papers on business model innovation was conducted based on the recommendations of Tranfield et al. (2003) from 2000–2019. A total of 70 conceptual and empirical studies on business model innovation research spanning from 2000 to 2019 were analyzed based on different classification schemes.

Findings

The systematic review approach of this paper offers a new perspective in understanding business model innovation, bridges the gap in the extant literature by providing consolidation regarding the triggers, enablers, barriers, dimensions and outcomes of business model innovation and indicating avenues for future research.

Research limitations/implications

A review of literature on business model innovation carried out in this paper is expected to open up new horizons for future researchers to develop and empirically test frameworks related to business model innovation. The five themes identified to shed light on important aspects of business model innovation. These themes are expected to not only strengthen the theoretical foundations of business model innovation but also help practitioners develop and implement business model innovations in their organizations. In particular, the themes related to the enablers, barriers, triggers and outcomes of business model innovation can provide useful insights for practitioners.

Originality/value

This study is the first of its kind that has provided consolidation regarding the triggers, enablers, barriers, dimensions and outcomes of business model innovation.

Details

International Journal of Innovation Science, vol. 12 no. 4
Type: Research Article
ISSN: 1757-2223

Keywords

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Article
Publication date: 16 December 2020

Nino Bernd Hoch and Stelian Brad

This study aims to increase understanding regarding the transformation of traditional business models, integrating digital technologies. The significance of digitisation…

Abstract

Purpose

This study aims to increase understanding regarding the transformation of traditional business models, integrating digital technologies. The significance of digitisation within business models has increased dramatically in recent years. Because of this, new knowledge on how to transform traditional business models into digital business models in a systematic way is needed. Digital technologies, embedded in previously non-digital goods, force companies to rethink their business models.

Design/methodology/approach

A design science research methodology was chosen for this study. A literature review and semi-structured interviews served as the theoretical foundation to integrate behavioural science into the design science process. From the design science perspective, an artefact is introduced to provide an architectural framework to manage business model innovation in a systematic way. The artefact's application is demonstrated through a case study conducted at a real company and evaluated afterwards by means of structured interviews with experts.

Findings

The authors propose a highly useable and valuable conceptual framework for systematic business model innovation. However, one limitation of the research is that it was conducted among construction professionals in Germany, and so the result might not hold true for other firms or industry branches.

Research limitations/implications

The research was conducted among construction professionals in Germany, and this acts as a limitation, as the result might not hold true for other firms or industry branches.

Originality/value

The purpose of this study is to provide managers with a framework for business model innovation, helping them systematically integrate digital technologies to create customer-added value. The proposed framework presents an innovative conceptual analysis of systematic business model innovation, which has not been addressed in prior studies.

Details

Business Process Management Journal, vol. 27 no. 2
Type: Research Article
ISSN: 1463-7154

Keywords

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Article
Publication date: 27 March 2020

Dong Yang, Zelong Wei, Huibin Shi and Jie Zhao

This study aims to investigate how market orientation (MO) motivates firms to develop business model innovation and how such effects are moderated by strategic flexibility.

Abstract

Purpose

This study aims to investigate how market orientation (MO) motivates firms to develop business model innovation and how such effects are moderated by strategic flexibility.

Design/methodology/approach

In this study, a questionnaire-based survey was undertaken to test the proposed hypotheses. The empirical study was conducted on a sample of 204 firms using two key informants (408 respondents) in China. The regression model is used to test the proposed model.

Findings

This research finds that both responsive market orientation (RMO) and proactive market orientation (PMO) have a positive effect on business model innovation. The effects of RMO and PMO on business model innovation are contingent on resource (coordination) flexibility in different ways. More importantly, this study finds that resource flexibility enhances the positive effect of RMO and weakens the positive effect of PMO. The study also finds that coordination flexibility enhances the positive effect of PMO.

Research limitations/implications

Future research can explore the internal mechanisms through which RMO and PMO promote business model innovations. Although the study finds that both the MOs promote business model innovation, they may promote business model innovation through different mediating effects. Future research can explore the role of external dynamic capabilities. This research mainly focuses on the internal dynamic capability of focal firms. However, as a focal firm-centered boundary spanning activity system, to transform into a new business model, firms not only need to reconfigure internal resource base, but also need to realign external collaboration network.

Practical implications

This research also bears important managerial implications. First, firms should be aware of the positive effect of MO on business model innovation. Firms with higher level of RMO or PMO can promote business model innovation. Second, when firms implement RMO for business model innovation, managers should focus on resource flexibility. Where MO is responsive, marketing managers need to be concerned with ensuring various applications of existing resource so as to understand effectively the current customers and market domain. Third, to leverage PMO for business model innovation, firms should adopt coordination flexibility. For firms with higher level PMO, firms should try to find the new internal coordination process for customer latent needs.

Originality/value

The conclusion extends the business model innovation research from the view of dynamic capabilities. As one of types of dynamic capabilities, MO is also the important antecedent of business model innovation. Further, this research also discusses the role strategic flexibility plays in business model innovation.

Details

Journal of Business & Industrial Marketing, vol. 35 no. 4
Type: Research Article
ISSN: 0885-8624

Keywords

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