Editorial: Business Model Innovation – A Concept between Organizational Renewal and Industry Transformation
Journal of Entrepreneurship, Management and Innovation, Vol. 11, Issue 1, pp. 3-10, 2015
8 Pages Posted: 19 May 2016
Date Written: 2015
With the new millennium and the hype of electronic business a new movement was created that still gains momentum: business model innovations. Deeply influenced by business informatics in the early years, business models and business model innovations became a pervasive part of our business life. Particularly business model innovations opened the door for a thinking far beyond product and process innovations. By considering new ways of designing value propositions, value-added architectures and sales modes (e.g. Timmers, 1998), business model innovations became an attractive option of recent innovation management and strategic management of the entrepreneurial kind as well. Especially small- and medium-sized entities (SMEs) found a new way to innovate without spending too much resources in uncertain investments.
Once successfully implemented, business model innovations on the micro level drive organizational renewal and/or help in developing new businesses. More than that, business model innovations may change the ‘rules of the game’ in markets and trigger processes of industry transformation (Porter & Rivkin, 2000) on the macro level.
Despite the considerable power of business model innovations, not every innovative business model is a ‘home-run’. Empirical evidence suggests (e.g. Freiling & Dressel, 2014) that sophisticated new business models promise ‘win-win’ constellations for both customers and suppliers, but face the problem of limited adoption in target markets. Insofar, the implementation goes along with numerous obstacles. Little is said about the root causes of these obstacles and the ways how to cope with these challenges.
Many of the articles of this special issue address the background of business model innovations and open the door to new debates. This illuminates the rather inter-disciplinary nature of business model innovations that deal with different kinds of novelties for both suppliers and customers. Based on Schumpeter (1934), innovations may relate to products, processes, organizational modes as well as novel purchasing and distribution modes. These novelties are often interrelated and call for an over-arching frame. If well designed, business models can be such umbrellas and are, thus, useful elements of innovation and strategic management. More than that, they push forward the notion of systemic innovation as a core challenge for both strategic decision-making and innovation.
The papers deal with both customers and suppliers, as innovation cannot be separated from adoption processes in markets. In this regard, some former background issues come to the fore in this special issue, such as the still under-researched role of emotions (cf. Straker and Wrigley, 2015) and the role of diversity of people (particularly in the light of different cultural backgrounds – cf. Harima and Vemuri, 2015).
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