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Business Model Innovation for Sustainability

19 Pages Posted: 5 Jul 2013  

Karan Girotra

INSEAD - Technology and Operations Management

Serguei Netessine

The Wharton School, University of Pennsylvania

Date Written: July 3, 2013

Abstract

A systematic approach to innovating business models can help identify new business models that encourage sustainable use of products and services, or facilitate wider adoption of new environmentally friendly technologies. This article provides a brief summary of a conceptual framework (fully described in Girotra and Netessine 2014) that we have developed to systematize the study and identification of new business models. Our approach advocates that the key to identifying new business models is understanding the context of decision making in existing models and the associated inefficiencies. We propose a three step approach: First, existing business models must be audited for identifying information and incentive misalignment inefficiencies that destroy value. Next, new business models can be identified by changing the context of the decision associated with the most consequential of these inefficiencies. We conjecture that four elements of the decision context are most significant: What decisions are made, When they are made, Who makes them, and Why they are made. We provide a set of idea triggers to stimulate brainstorming of new business models by changing one of these four Ws. Finally, we advise that generated business models should be analyzed and experimented with to identify the most promising ones. We close the article by describing the design of a pedagogical program based on this framework.

Suggested Citation

Girotra, Karan and Netessine, Serguei, Business Model Innovation for Sustainability (July 3, 2013). INSEAD Working Paper No. 2013/77/TOM. Available at SSRN: https://ssrn.com/abstract=2289291 or http://dx.doi.org/10.2139/ssrn.2289291

Karan Girotra (Contact Author)

INSEAD - Technology and Operations Management ( email )

Boulevard de Constance
77 305 Fontainebleau Cedex
France

Serguei Netessine

The Wharton School, University of Pennsylvania ( email )

SH-DH 1332B
Philadelphia, PA 19104-6367
United States
(215) 573 3571 (Phone)
(215) 898 3660 (Fax)

HOME PAGE: http://www.netessine.com

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