Business Model Innovation and Organizational Design: A Dynamic Capabilities Perspective

Forthcoming in Business Model Innovation: The Organizational Dimension, edited by Nicolai Foss and Tina Saebi, Oxford University Press

24 Pages Posted: 6 Jul 2014 Last revised: 14 Mar 2015

See all articles by Sohvi Heaton

Sohvi Heaton

Greg Linden

Institute for Business Innovation

David Teece

Institute for Business Innovation

Date Written: March 16, 2014

Abstract

Dynamic capabilities are deeply enmeshed with business model innovation and implementation. Dynamic capabilities reside in the collective learning and culture of the organization and in the entrepreneurial skill of the top management team. Entrepreneurial managers bear the primary responsibility for recognizing the need for business model change, for adjusting or inventing business models, for orchestrating the necessary assets, and for (re)structuring the organization as needed. They are also responsible for strategy formulation, which is separate from, but related to, dynamic capabilities. The organization’s structure, incentives, and culture can, in turn, be more or less well suited to the recognition of new opportunities and the implementation of new structures that are integral to the dynamic capabilities of the firm. In short, the generation of new business models requires entrepreneurial managers to balance attention to customer needs and technological possibilities with the logic of organization.

Suggested Citation

Heaton, Sohvi and Linden, Greg and Teece, David J., Business Model Innovation and Organizational Design: A Dynamic Capabilities Perspective (March 16, 2014). Forthcoming in Business Model Innovation: The Organizational Dimension, edited by Nicolai Foss and Tina Saebi, Oxford University Press . Available at SSRN: https://ssrn.com/abstract=2423191

Greg Linden

Institute for Business Innovation ( email )

F402 Haas School of Business, #1930
Berkeley, CA 94720-1930
United States

David J. Teece

Institute for Business Innovation ( email )

F402 Haas School of Business, #1930
Berkeley, CA 94720-1930
United States
(510) 642-4041 (Phone)

No contact information is available for Sohvi Heaton

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