Technological Forecasting & Social Change 185 (2022) 122078

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Technological Forecasting & Social Change

journal homepage: www.elsevier.com/locate/techfore

Designing business models for Industry 4.0 technologies provision: Changes

in business dimensions through digital transformation
Érico Marcon a, Marie-Anne Le Dain b, Alejandro G. Frank a, *
a
Organizational Engineering Group (Núcleo de Engenharia Organizacional – NEO), Department of Industrial Engineering, Universidade Federal do Rio Grande do Sul,
Brazil
b
Univ. Grenoble Alpes, CNRS, Grenoble INP, G-SCOP, 38000 Grenoble, France

A R T I C L E I N F O A B S T R A C T

Keywords: Industry 4.0 (I4.0) literature has been concerned with how to implement digital technologies in manufacturing
Fourth industrial revolution processes. However, the I4.0 concept also comprises broader changes in the company's business model (BM)
Business model innovation through digital transformation, which deserves more attention, especially from the technology providers'
Digital transformation
perspective. As they are essential to advancing the digital transformation diffusion and creating I4.0 ecosystems,
Smart manufacturing
Industry 4.0
their business model innovation (BMI) in this context is a keystone for I4.0. Thus, we consider how changing
factors in the I4.0 context affect the business model dimensions of technology providers. We analyze changing
factors in the three main BM dimensions: front-end, back-end, and value proposition. We study ten I4.0 tech­
nology providers and explain the mechanisms of change involved in their BMI, explaining how and why such
changes happen. The findings provide practitioners with insights to anticipate the necessary actions to manage
and incorporate such changes, whether they rely more on data and IoT devices, new BMs such as training and
consulting, dynamic pricing forms, new software/hardware, or service competencies. We also provide a detailed
analysis of elements of change in the BM that can be used in theory to understand better the different digital
transformation impacts in the Industry 4.0 context.

1. Introduction
Industry 4.0 (I4.0) is a new industrial maturity stage characterized
by the intensive use of digital base technologies such as the Internet of
Things (IoT), cloud computing, big data, and artificial intelligence.
These base technologies are combined with front-end technologies such
as additive manufacturing, advanced robotics, and sensors to create
cyber-physical systems for smart factories (Kagermann et al., 2013). The
I4.0 concept has evolved from only focusing on the manufacturing sys­
tems to a broader perspective in which several other business di­
mensions are interconnected with the factory, including the supply
chain, the end products and services, and the way workers operate in the
production system (Frank et al., 2019a; Meindl et al., 2021; Estensoro
et al., 2021). In this sense, I4.0 is considered the result of the digital
transformation journey in the industrial environment, involving an
evolutionary perspective of technology adoption that demands attention
not only from the technological point of view but also through an
organizational and environmental perspective (Marcon et al., 2021).
Some studies have recognized the need for understanding I4.0 from a
business model innovation (BMI) perspective (Metallo et al., 2018;
Müller et al., 2018; Müller, 2019; Weking et al., 2019). The literature on
this theme shows that customer segmentation and target market, prod­
uct usability and customization, platform and software development,
and servitization are important in providing advanced I4.0 solutions
(Benitez et al., 2021; Metallo et al., 2018). Müller et al. (2018) found
that small and medium-sized enterprises providing these technologies
need to search for external knowledge, improve cooperation, develop
servitized offers and connectivity along the value chain. These ap­
proaches allow wider customer contact, easier communication, and
automated value-capturing processes. Sarbu (2021) analyzed the rela­
tionship between Industry 4.0 and innovation and found a greater
impact on companies of the service sector because these firms rely even
more on interconnection and automation technologies to provide their
offers when compared to the manufacturing sector. The study also found
that big data analytics is positively related to product innovation and
innovation intensity, indicating its importance for BM innovation.

* Corresponding author at: Universidade Federal do Rio Grande do Sul, Av. Osvaldo Aranha 99 - Sala LOPP 508 - 5◦ andar. Escola de Engenharia, Centro, CEP
90035190 Porto Alegre, RS, Brazil.
E-mail address: ag.frank@ufrgs.br (A.G. Frank).

https://doi.org/10.1016/j.techfore.2022.122078
Received 18 August 2021; Received in revised form 28 August 2022; Accepted 25 September 2022
Available online 20 October 2022
0040-1625/© 2022 Elsevier Inc. All rights reserved.
É. Marcon et al.
Metallo et al. (2018) also showed that the value proposition and the
activities performed by providers are the most important aspects of their
BMs. Thus, product newness, improved performance, and customization
are important value characteristics. Also, an increased focus on services
and support activities is expected to be highly valued by customers in the
I4.0 field (Benitez et al., 2021).
Although BMI in I4.0 has already been addressed in some studies, the
perspective of BMI in I4.0 for technology provision is still limited in the
literature. Studies that have addressed this issue considered both tech­
nology providers and adopters (Metallo et al., 2018; Müller, 2019)
without emphasizing the particular role of technology provision. Such
studies advanced the knowledge of how BM is implemented in the I4.0
context. However, addressing the BMI, especially in technology pro­
viders, is necessary because they play a key role in I4.0 ecosystems
(Benitez et al., 2020, 2021; Kahle et al., 2020). As Benitez et al. (2021)
pointed out when technology providers engage in the provision of I4.0,
they can create synergies and network effects by providing new business
models that enable the integration of different technologies and com­
panies. For instance, BMI in technology providers created opportunities
for digital product-service systems in the I4.0 domain (Frank et al.,
2019b; Dalenogare et al., 2022). However, little is known about the
mechanisms of change such providers have faced through digital
transformation. On the one hand, they have created new solutions and
changed their value proposition through digital technologies (Daleno­
gare et al., 2022). On the other hand, they have also been an object of
digital transformation, changing their operations and internal activities
(Metallo et al., 2018; Müller, 2019). These changes that drive BMI are
complex and involve new relationships (internally and externally),
technologies, algorithms, digitalization of processes, and new value
delivery forms (Metallo et al., 2018; Paiola et al., 2021). The changing
demands increase the I4.0 focus on data acquisition to monitor customer
needs, more customized offers, data-driven revenues, and the possibility
of selling such data (i.e., Frank et al., 2019b; Lerch and Gotsch, 2015).
Therefore, more research is needed to deepen the understanding of the
BMI structure, including how and why digital transformation changed
the BM dimensions of these companies.
We aim to analyze the mechanisms adopted by I4.0 technology
providers to address these changing factors from digital transformation
and understand how they impact the different BM of such type of
technology providers. To this aim, we consider from the literature three
digital transformation main changing factors: (i) digital technologies that
are used to operationalize and improve the process of BMs, (ii)
competitive positioning based on differentiation (servitization and mass
customization), and (iii) digital ecosystems, which imply closer relation­
ships with partners, customers and competitors for providers to acquire
and exploit external knowledge to develop complex BMs (Benitez et al.,
2021; Frank et al., 2019b; Müller et al., 2018; 2021; Paiola et al., 2021).
We consider how these changing factors relate to the general BM di­
mensions – back-end, front-end and value proposition – and their related
BM elements. Then, we investigate through a case study research
method approach ten I4.0 technology providers, explaining how and
why such changes happen. The findings provide practitioners with in­
sights to anticipate the necessary actions to cope and incorporate such
changes, whether they are increased training, dynamic pricing forms,
new software/hardware, or service competences. Moreover, BMs that
leverage the I4.0 technologies maximize their value delivery and bring
more results to customers faster and more customized (Marcon et al.,
2021; Kiel et al., 2017). The focus on servitization and customization
also impacts the BM demanding new processes and interactions with
customers, but their biggest impact is in the value proposition of pro­
viders. The digital ecosystems are also expected to allow improved BM.
However, technology providers must consider and be prepared to
manage these actors and internalize capabilities to improve future offers
as well.
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Technological Forecasting & Social Change 185 (2022) 122078
2. Theoretical background
2.1. Business model innovation
Teece (2010) defines a BM as a conceptual model of the business
which considers the organizational and financial ‘architecture’ of the
business. Such architecture describes “the system of interdependent
activities that are performed by the firm and by its partners and the
mechanisms that link these activities to each other” (Zott and Amit,
2013). Cortimiglia et al. (2016) showed through empirical data that BM
can be considered as the operationalization of the organizational strat­
egy. This is because it defines the architecture of the business once the
strategy has been defined by companies. The technology innovation
literature has been concerned with the source of innovation and change
in the BM, usually naming this phenomenon as business model inno­
vation (BMI). Such sources can originate in both external and internal
driven-factors and can create radical or incremental changes in the
business structure (Ghezzi et al., 2015). Therefore, BMI considers how
changing factors may create opportunities to innovate not only in the
value proposition (product or service offered), but in the whole business
architecture (Ghezzi et al., 2015).
To study BMI, we adopt the conceptual framework of the BM Canvas
(Osterwalder and Pigneur, 2010). We adopted this framework because it
is one of the most disseminated tools to form BM concepts in the in­
dustry. It allows to analyze companies' BMs by addressing nine building
blocks that constitute their business dimensions. This framework sum­
marizes the company's business structure in a simple and intuitive form
and has been used to understand similar topics such as IoT and product-
service systems (Barquet et al., 2013; Metallo et al., 2018). The BM
Canvas is composed by nine elements (Osterwalder and Pigneur, 2010),
which can be grouped into two main dimensions: front-end activities
and back-end elements (Günzel and Holm, 2013). Value proposition,
one of the front-end elements, can be also considered as separated
dimension representing the heart of the business model, as highlighted
by Osterwalder and Pigneur (2010) when they analyzed unbundling
models (i.e., a BM in which companies need to focus their strategy the
main BM dimensions). As pointed out by Osterwalder and Pigneur
(2010), companies that have a unbundling BM need to focus on
customer relationship (front-end), infrastructure (back-end), and prod­
uct innovation (value proposition), comprising all the elements of the
BM as a part of an integrative strategy. We follow this view from
Osterwalder and Pigneur (2010) and Günzel and Holm (2013), by
consider these three BM dimensions for general analysis of Industry 4.0-
related BMs, as represented in the conceptual framework that will be
discussed in Section 2.3 (Fig. 1). These dimensions of BMI have been also
previously considered in the I4.0 literature (Metallo et al., 2018).
The ‘value proposition’ dimension (Fig. 1) comprises describes the
deliverables (products and services) that create value to customers or a
specific segment of customers. This dimension describes the problem
that the company is solving or the customers' needs satisfied by the
provider. The value proposition dimension needs to match the customer
segment element from the front-end dimension as they form the align­
ment of the proposition in the BM Canvas.
The ‘front-end’ dimension (Fig. 1) considers BM elements that
directly relate to the customer. The first element is the customer
segment, which represents the different groups of people or organiza­
tions that the company aims to serve and reach (Osterwalder and
Pigneur, 2010). This element is directly connected to the value propo­
sition. Then, two pillars support the alignment between the value
proposition and the customer segment: customer relationships and value
delivery channels. Customer relationships describes the types of re­
lationships established between the company and its customer segments
and can range from personal to automated and are driven by motiva­
tions such as customer acquisition, retention, or sales boosting. Next,
value delivery channels describe how a company communicates with its
customer segments and maintains its relationship with the customer to
É. Marcon et al.
Fig. 1. Main dimensions and elements of the BM Canvas and changing factors influencing them.
deliver its value proposition. Finally, the revenue streams describe how
the company profits from each customer segment through the value
proposition delivered via the relationship and distribution channels. In
this sense, the company may have different pricing mechanisms for
different customer segments or their use patterns (Grubic, 2018).
The ‘back-end’ dimension (Fig. 1) represents the group of operational
business elements to obtain the value proposition. In this sense, the first
element is Key Activities which considers the most important activities
that companies need to run to deliver the value proposition (e.g., for a
consultancy firm solving problems is their key activity). In this sense, key
activities look at the most relevant processes within the company. Then,
the key resources describe the assets required to deliver the value prop­
osition through the key activities. In other words, key resources represent
what the company needs to own to create and offer its value proposition
to the market - e.g., physical, financial, intellectual, or human assets
(Osterwalder and Pigneur, 2010). Moreover, internal operations can be
complemented by the development of key partners, i.e., the partners and
suppliers necessary to run the business. They represent alliances to
optimize the activities, reduce risks, and acquire resources. Finally, the
back-end is assessed with the cost structure, which presents the important
costs in the BM's operation and comprehends the expenses of creating
and delivering value, maintaining customer relationships, and gener­
ating revenue (Osterwalder and Pigneur, 2010).
2.2. Industry 4.0 technology provision and BMI
BMI can be used as a tool to operationalize strategy and a means to
strategically respond to opportunities and threats in the market (Corti­
miglia et al. (2016)). This is the case of I4.0 since it encompasses tech­
nological changes with new tools, devices, digital means, algorithms,
and systems that pose opportunities for companies to provide solutions
to improve their BMs. I4.0 also encompasses market changes with closer,
more sustainable, and customized solutions that demand more than
solely classic, product-centric offers (Frank et al., 2019b). Thus, these
changes impact the BMs of I4.0 technology providers, including their
solutions offered and their relationships with customers and partners
leveraged by digitalization (Capello and Lenzi, 2021; Frank et al.,
2019b). As companies adopt I4.0 technologies, their competences, costs,
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Technological Forecasting & Social Change 185 (2022) 122078
value proposition, and even revenue streams can change (Marcon et al.,
2019). Müller et al. (2020) analyzed the small and medium enterprises
(SMEs) context and found that providers expect more changes than
customers and that advanced adopters can become providers or users/
providers of I4.0, given the know-how they acquired. Literature also
shows that new value proposition, more centered on individualized of­
fers toward meeting customer requirements, such as condition-based
monitoring and predictive maintenance based on dynamic pricing and
pay-per-use revenues, are examples of these BMIs (Marcon et al., 2019;
Müller, 2019).
Technology providers must deal with several changes that can in­
fluence on their BMs. These changes can be grouped into three main I4.0
changing factors based on the demand-pull factor related to servitiza­
tion, the technology-push factors related to digital transformation, and
the relational-driven necessity of integrating an ecosystem of diverse
actors in closer relationships to develop, produce, improve and deliver
these complex solutions (Frank et al., 2019b; Metallo et al., 2018;
Weking et al., 2019). We explore each of them in the following
subsections.
2.2.1. Changing factor: digital technologies
Technology providers are expected to rely more on digital means to
provide better solutions at lower costs (Lerch and Gotsch, 2015; Marcon
et al., 2019). Digital technologies allow BMs to be organized around
holistic offers of automated solutions (Fritschy and Spinler, 2019).
Consequently, BMs can focus on data analytics, market intelligence,
condition monitoring, cloud computing, machine communication, and
augmented reality devices to provide value to customers. One of these
examples is predictive maintenance enhanced by IoT devices (Kiel et al.,
2017). Also, process optimization within customers' production systems
and novel data-driven service solutions are being offered due to IoT,
cloud computing, and AI algorithms (Frank et al., 2019b). These solu­
tions demand that technology providers meet complex changes and
setups related to software and hardware integration into modular
combinations and change their channels toward direct distribution that
controls the offer and the supply (Kiel et al., 2017).
One example of I4.0-driven BM is reported by Fritschy and Spinler
(2019) on the future of autonomous automotive and logistics trucks,
É. Marcon et al.
where digital transformation via predictability improved with data for
routing will boost delivery reliability. Truck sharing and capacity-as-a-
service (where the manufacturer is responsible for the transportation
and fleet management in a solution-based BM) are offered, given the
intelligence added to these products. These offers, supported by in­
novations in digital technologies and data analysis, show increased
complexity. However, they provide the means for economy of scale and
customized offers (Kagermann et al., 2013; Müller, 2019). Another
example is provided in Dalenogare et al. (2022). This study shows
different product-service systems BM feasible through digital technolo­
gies, including smart glasses, smart products and digital service systems.
As shown in this study, the data integration enabled by these technol­
ogies allows the offering of different advanced solutions aligned with
customer demands. It can also integrate other partners from the
ecosystem, altering the whole structure of the company's operation. In
this sense, the first changing factor can be summarized in the following
statement: Technology providers can increase the digitalization of operations
and data-based structure for more complex offers based on I4.0 technologies
such as big data, analytics, process automation, and cyber-physical systems.
2.2.2. Changing factor: ecosystem integration approach
I4.0 solutions demand more analytical and service capabilities to
deliver new offers (Dalenogare et al., 2018; Rymaszewska et al., 2017).
These resources may represent a barrier to technology providers since
they usually lack such skills (Marcon et al., 2019). In this sense, com­
panies may need to establish partnerships not only with immediate
suppliers but also with an ecosystem of other companies, startups, and
partners that provide data services, industrial agencies, and software
providers to be able to address the needs of adopters (Benitez et al.,
2021; Dalenogare et al., 2018). Thus, partners are expected to become
closer to the company, focusing on cooperation and vertical integration.
Also, the I4.0 literature shows that due to the greater integration among
stakeholders, technology providers can focus on their core activities and
share capabilities and resources for collaborative manufacturing solu­
tions (Frank et al., 2019b; Dalenogare et al., 2022). Providing I4.0 so­
lutions can enable new customer relationships due to greater
connectivity via ubiquitous data exchange (Porter and Heppelmann,
2014). Besides complementary capabilities, Dalenogare et al. (2022)
also showed the need for data integration among the different ecosystem
actors to make the new BMs feasible. As shown in their study, other
ecosystem actors can help with data sources that are useful to change the
way product and services are offered.
This need for an ecosystem approach to develop closer relationships
and partnerships is one of the most important aspects of BMI. It allows
co-designing solutions, innovative partnerships, information trans­
parency, joint decision-making, and value-capturing processes to share
knowledge, information, resources, and capabilities with ecosystem
partners (Benitez et al., 2021; Metallo et al., 2018). In their study on how
SMEs approach BM innovation, Müller et al. (2020) found that I4.0 will
demand higher inter-company connectivity, co-design of offers, joint
data analysis, and information transparency based on innovative part­
nerships to create value. Also, value capturing will require customer
contact via digital platforms, improved interactions through digital
means, co-design, and co-engineering. These aspects lead to more cost
transparency, joint decision-making, and integration with the cus­
tomer's value chain.
Additionally, important changes such as crowdsourcing, open inno­
vation, mass customization, and ecosystem integration are demanded in
I4.0 BMs (Benitez et al., 2020; Weking et al., 2019). Such partnerships
with technology providers are necessary to increase customer knowl­
edge and allow leveraging opportunities for replication economies
(Paiola et al., 2021). In this sense, this changing factor can be summa­
rized in the following statement: Technology providers must increase
the interaction not only with customers but also with other partners,
such as IT companies, startups, associations, and other providers, to
offer increasingly complex and broad I4.0 solutions.
4
Technological Forecasting & Social Change 185 (2022) 122078
2.2.3. Changing factor: competitive positioning based on differentiation
The final changing factor related to I4.0 is the competitive posi­
tioning enabled by offers focused on solutions and servitized BMs (Frank
et al., 2019b). Since the I4.0 solutions gear providers toward broader
offers, the change toward adding value not only by the sale of a product
but by continuous services are increasingly important, such as consul­
tancy, monitoring, machine upgrade, and the possibility of improving
internal processes through technology (Frank et al., 2019b; Rymas­
zewska et al., 2017). This changing factor results from the combination
of the other two factors as I4.0 technology suppliers leverage the digital
technologies and ecosystem approach to enable more advanced service
offers capable of substituting the product and providing value to cus­
tomers' internal processes (Frank et al., 2019b). In this context, AI is
essential to develop innovative BMs that leverage digitalization and
servitization (Sjödin et al., 2021). Additionally, solutions based on IoT,
simulation, big data and analytics, smart products, and sensors bring
possibilities and changes that cannot be ignored in the long term (Kahle
et al., 2020; Weking et al., 2019). According to Sarbu (2021), the
manufacturing sector needs to push the servitization of their offer based
on the I4.0 technologies to remain competitive; otherwise, the fear of
new technologies and cybersecurity issues will threaten profitability and
growth.
The I4.0 technologies allow offering customized solutions according
to each customer segment based on the digital solutions (Kiel et al.,
2017; Lerch and Gotsch, 2015). Customers' specific needs are then met
by the offer of accurate solutions, more adapted to customers' needs, or
even substitute the product purchase (Frank et al., 2019b). However,
changes in operation's complexity, employee skillsets, revenue period­
icity, and digital-based solutions are expected, impacting even customer
loyalty due to such servitization focus (Frank et al., 2019b). This shift
toward service-centered solutions demands two important re­
quirements, absorbing prior knowledge and the type of digital service
offered (Paiola et al., 2021). Prior knowledge is crucial to conceptualize
and operationalize such advanced BM as it provides the appropriate
cognitive resources and in-house capabilities, as well as an entrepre­
neurial approach to the projects with experimentation and drawing on
external resources and competences (Paiola et al., 2021; Müller et al.,
2020).
Several different touchpoints with partners via technologies and
tools to co-design and interact through apps, websites, and portals are
also important drivers in these BMs (Kahle et al., 2020). Moreover, due
to the connectivity provided by smarter products and connected
equipment, such technologies allow greater contact directly with the
customer and leverage such contact to develop customized, outcome-
based offers (Frank et al., 2022; Lerch and Gotsch, 2015). Hence, the
final changing factor can be summarized in the following statement: As
the I4.0 transformation advances, the company's offers are becoming more
focused on service solutions since increased customer orientation is deman­
ded. Thus, technology providers must consider providing more customized
solutions.
2.3. Conceptual research framework
BMI, such as those boosted by I4.0 changes, impact BM operation­
alization and performance (Frank et al., 2019b; Paiola et al., 2021). The
BMI direction is usually from the outside (market) to the company's
inside. However, in a micro-level analysis, internal factors may also be a
source of disruptive changes (Ghezzi et al., 2015). We consider both
approaches in our analysis, i.e., environment-driven and enterprise-
driven, as they assume that market conditions and internal aspects
impact performance and lead companies to change their BM according
to their strategy or macro-level tendencies (Ghezzi et al., 2015). Tech­
nology providers must understand the market and cope with internal
changes to succeed in new offers and solutions. The BM Canvas has been
used for this purpose and to analyze BMI on similar topics, such as the
Internet of Things (Metallo et al., 2018), disruptive and incremental
É. Marcon et al. Technological Forecasting & Social Change 185 (2022) 122078

innovation on electric vehicles (Benzidia et al., 2021), IoT business ap­ 3. Research method
plications (Kiel et al., 2017), and Product-Service Systems offers (Bar­
quet et al., 2013). Table 1 summarizes the BM changes described in the Given the empirical character of the problem addressed, we
I4.0 literature and their relative I4.0 changing factor, which served as employed a qualitative analysis approach (Yin, 2009). This method
inputs for our analysis. enables a closer contact to the subjects of study – i.e., I4.0 technology
Elaborating on the literature insights from these studies described in providers (Voss et al., 2002). Our qualitative study aimed to understand
Table 1 and the theoretical background (Sections 2.1 and 2.2), we the mechanisms of change produced by the I4.0 changing factors in the
developed a conceptual framework to analyze the intersection between three main dimensions of the technology providers' BMs, as represented
BMI and I4.0 in the competitive context of the B2B market, as repre­ in the conceptual research framework of Fig. 1. We choose a case study
sented in Fig. 1. This framework includes two main elements: (i) the BM approach because this method can provide a deep understanding of the
macro-dimensions and dimensions (Section 2.1) and (ii) a classification mechanisms involved in these changing factors and BM dimensions,
schema for I4.0's changing factors (Section 2.2). This framework as­ helping to understand ‘how things happen’, which is essentially the nature
sumes that the I4.0 results from technological and market changes, of qualitative studies (Eisenhardt and Graebner, 2007; Yin, 2009). We
which are important requirements for the success of a BM. In this sense, also followed the recommendations of Voss et al. (2002) to conduct this
providing I4.0 solutions demands changes to the offers regarding their type of research, following the main stages and procedures proposed in
operationalization, performance, suitability, and the means to their their guideline, as described next.
delivery. Hence, the BM changes are mechanisms companies use to
adapt, improve and benefit from these market changes. We aim to un­ 3.1. Case study selection
derstand how these BM changes (Table 1) occur in the interface between
technology and business innovation, as depicted in Fig. 1. This research used theoretical sampling for case selection (Eisen­
hardt and Graebner, 2007) since the objective is to build concepts and
theory regarding the mechanisms involved in BMI when I4.0 changing
factors are present. Therefore, the main criterion for sample definition
was to search for cases representative of I4.0 technology provision
regarding key technologies offered with leading representativeness of
Table 1 the technologies and companies analyzed in the manufacturing industry
Conceptual research framework – I4.0 changing factors and BM dimensions. (Frank et al., 2019a; Meindl et al., 2021). To identify and reach these
I4.0 Changing BM changes described in References representative cases, we used complementary approaches. First, we
Factors literature contacted industrial business associations in Brazil: the Brazilian Asso­
Digital Holistic offers of automated Frank et al., 2019b; Fritschy
ciation of Machinery and Equipment Builders (ABIMAQ) and the Bra­
technologies solutions and Spinler, 2019; zilian Association of Electric and Electronics Industry (ABINEE) (Benitez
Process optimization within Kagermann et al., 2013; et al., 2020). We asked them to provide a list of I4.0 providers
customers' production systems Müller, 2019; acknowledged by their associates, considering their innovative profile,
Improved revenue and
market representativeness, and the breadth of technologies offered.
operational predictability
Economy of scale and In the second step, we analyzed the technologies offered by these
customized offers companies to consider a diversity of technologies related to I4.0 solu­
Ecosystem Cooperation and vertical Benitez et al., 2020; Benitez tions and the profile of the companies' business models, i.e., whether the
integration integration among players et al., 2021; Dalenogare business models were strongly oriented to I4.0 solutions and not only the
approach Share capabilities and et al., 2018, 2022; Frank
resources for collaborative et al., 2019b; Metallo et al.,
provision of single technologies. In this sense, although some companies
manufacturing solutions 2018; Müller et al., 2020; focus on specific technologies, all selected provide integrative solutions
Enable new customer Porter and Heppelmann, to manufacturers based on the leading technology. This approach is
relationships 2014; Weking et al., 2019; consistent with Eisenhardt and Graebner's (2007) recommendations that
Co-designing solutions
the cases selected should be chosen for the likelihood that they will offer
Innovative partnerships
Information transparency theoretical insight, which was the goal of the process employed in this
Value capturing processes to selection. The chosen companies are listed in Table 2. It is worth
share knowledge noticing that two of these companies studied were pioneers in providing
Ecosystem integration: joint I4.0 solutions when the concept was created in Germany. We opted to
decision-making,
crowdsourcing, open
analyze a mixed sample of local and multinational companies, which
innovation can provide a broader view of the mechanisms for the changes of BMs in
Positioning based Complementary offers: Frank et al., 2019b; Frank I4.0. Thus, our sample provides a general view of the suppliers of I4.0.
on consultancy, monitoring, et al., 2022; Gunasekaran Moreover, the selected companies are engaged in ecosystem activities
differentiation machine upgrade, and the et al., 2017; Marcon et al.,
and oriented toward solution provision and not only a single technology
possibility of improving 2022; Rymaszewska et al.,
internal processes through 2017; Lerch and Gotsch, provision (Benitez et al., 2021). This characteristic was an important
technology 2015; criterion since it assured that the companies interviewed were not only
Advanced service offers providers of individual technologies but were inserted into the I4.0
capable of substituting the context, aware of the challenges, and capable of explaining the mech­
product
Offering customized solutions
anisms necessary to provide the solutions. Finally, most companies
according to each customer selected were multinationals with BMs and operations replicated in
segment Brazil and other countries. The national companies are also important
Changes in operation's since they are inserted in the I4.0 context and provide solutions to large
complexity, employee
and multinational companies. Thus, their country of operation is not
skillsets, revenue periodicity,
and digital-based solutions are limiting to the generalizability of the results since the companies'
expected operation encompasses a global view and global changes. The multiple
Develop customized, cases listed in Table 2 augment our research's generalizability and avoid
outcome-based offers by possible research bias, even though the demanded resources are higher
absorbing prior knowledge
(Eisenhardt and Graebner, 2007).

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É. Marcon et al. Technological Forecasting & Social Change 185 (2022) 122078

Table 2
Cases of technology providers analyzed.
Company name I4.0 Solution Focus Technology or solution provided Market Interviewee

Software Integration Smart Manufacturing Vertical integration + Big Data + Energy systems Brazilian CEO
Additive Manufacturing Smart Manufacturing Industrial 3D printing + IoT process integration Brazilian Founders
Sensor Smart Manufacturing Sensors and IoT solutions Brazilian CEO
Automation Smart Products Classic automation and IoT systems for manufacturing Multinational Marketing
Supply Chain Smart Supply Chain Supply Chain management Brazilian Product Manager
Planning and Scheduling Smart Supply Chain APS software and Business Intelligence Multinational Founders
Cobots Smart Working Collaborative Robots Multinational Business Manager
Exoskeleton Smart Working Exoskeleton Multinational VP of Sales
Predictive AI Base technology - Cloud, Big data, and analytics Data analytics and AI for failure prediction Brazilian Founder
Industrial IoT Base technology - IoT and Cloud Industrial IoT platform Multinational Product Manager

3.2. Data collection
Data was collected using as a primary source a semi-structured
questionnaire with four groups of questions (Appendix A). The group
of questions used as an information source addressed the company's
business model regarding the I4.0 technology provision and perceptions
of change in the business model enabled by the I4.0. Preliminary
questions on the company's market were asked on the products and
strategy of the company. Data collection occurred for six months in
2020. Each interview was fully recorded and transcribed. Researchers
also took notes, which served as a summarization of the data collected.
To increase the study's reliability, we used a case study protocol, a
defined research framework, and multiple researchers collecting and
discussing the data. A meeting between the researchers also allowed for
discussing possible incompatibilities.
Data was collected by contacting interviewees by phone or e-mail
describing the project and the aim of the study. Then, after the in­
terviewee's acceptance, we scheduled the interviews, which occurred
through video conference with at least three researchers and one or
more interviewees. The interviews lasted an average of 90 min. In the
cases of the companies Software Integration, Additive Manufacturing,
Planning and Scheduling, and Sensor, we also conducted visits to the
companies, which allowed further understanding of the company's
context and richer data collection.
3.3. Data analysis – validity, reliability, and interpretation
Construct validity, internal validity, and external validity are important
aspects of case research (Voss et al., 2002; Yin, 2009). In this sense, the
data collected was analyzed following Voss et al.'s (2002) suggestions,
beginning with construct validity that addresses how different con­
structs are from each other. We addressed this problem by triangulating
data from different sources company's website, internal presentations,
and customers' interviews, to increase the construct validity of the
research, as several sources enabled different views of the results (Voss
et al., 2002). We also adopted multiple sources of evidence, and other
researchers participating in the interviews reviewed the study draft to
check for such validity. For internal validity issues, during the in­
terviews, we sought to establish chains of evidence between the state­
ments made by interviewees, such as asking how the solution offered led
to changes in the relationship with customers, the costs for the in­
vestments in the solution provided, or how the new BM generate new
revenue streams (Voss et al., 2002). We selected multiple cases with
different focuses, sizes, and technologies to enable external validity,
which increases replicability (Yin, 2009).
We organized the data collected according to the source of infor­
mation and coded it according to the impact mentioned by the company
on each of the BM Canvas building blocks to address the relationships
proposed in the framework. Thus, the excerpts where the interviewees
mentioned their business model change were highlighted, as suggested
by Voss et al. (2002). Data were then analyzed according to Bardin's
(2011) meaning rule, which consists of identifying common issues and
gathering them based on the interpretation of their meaning, following
predefined labels, i.e., the excerpts gathered for each business model
canvas block. This step was conducted by carefully reading the quotes
and improved by analyzing the notes taken during the interviews. After
this case analysis, we analyzed the findings from a cross-case perspective
to identify similarities, contrasts, and patterns (Voss et al., 2002).
Together with the evidence presented in the theoretical background,
these two analyses enabled us to develop the final framework, which
shows the main changing factors in business models promoted by I4.0.
4. Results
4.1. Overview of the BM offered by the companies analyzed
The companies analyzed provide different types of BMs, each of them
with idiosyncrasies and different challenges. Table 3 summarizes their
BMs, operation and revenue streams.
Table 3
Cases of technology providers analyzed.
Company name BM summary
Software Integration Software solutions for the real-time management of
industrial processes, energy, sanitation and infrastructure,
integrating systems and data for decision-making. Revenue:
software implementation, customization, process consulting,
licensing.
Additive Sale of supplies and equipment related to 3D-printing,
Manufacturing prototyping, and piece manufacturing. Revenue: project,
printing consultancy, printer sale.
Sensor Electronic equipment for data acquisition and monitoring,
temperature control, process control, signal conditioning
and transmission of field variables. The company also
provides a new MES solution built with partners. Revenue:
sale of products, process consulting, MES installation,
licensing, monthly fee.
Automation Industrial IoT and automation for data collection, control,
quality inspection, predictive maintenance, safety measures,
and remote monitoring. Revenue: operation consulting,
engineering hours, and product/system sale.
Supply Chain Business intelligence and supplier-customer integration
through data collection and analysis of customer's stocks,
purchase patterns and delivery times. Revenue: system
implementation fee, consultancy hours, monthly fee.
Planning and Business intelligence and production and planning
Scheduling consultancy and implementation for manufacturing
companies that want to schedule production based on pulled
principles and actual capacity for optimized flow. Revenue:
system implementation fee, consultancy hours, monthly fee.
Cobots Sale of cobots and consultancy of installation, use,
optimization, and maintenance. Revenue: cobot-as-a-service,
cobot sale.
Exoskeleton Sale of exoskeletons with process optimization for
technology's use.
Predictive AI Data collection and analysis for failure prediction and
process consultancy. Revenue: Installation, optimization,
monthly fee.
Industrial IoT Cloud platform for IoT application of industrial solutions;
Revenue: licensing, monthly fee and users' accounts.

6
É. Marcon et al.
The records and transcriptions from interviewees were coded based
on categories to aggregate results. Table 4 depicts the macro-dimensions
and the categories that compose them. Even though not all companies
went through all of the changes mentioned, the categories below pro­
vide a direction to the myriad of changes suffered when offering I4.0
solutions. It also summarizes the reasons why and the from through
which companies are addressing these changes to their BMs.
4.2. Analysis of the BM value delivery dimensions
4.2.1. Digital technologies in the value delivery
The value delivery macro-dimension is impacted by digital tech­
nologies since data, and information allow the creation of new forms of
value delivery. Customers expected financial, production, and
Table 4
BM dimensions coding table.
BM dimensions BM Canvas Categories
Value delivery Value Innovation capability
operations Proposition BM focused on value not sale
Analysis of the benefits expected by
the customers
Safety and data cybersecurity
Front-end Customer Relationships focused on incentivizing
operations Relationships more projects, building trust, and
sharing experiences
Closer contact
Interactions for diminished
uncertainties, shared risks
Channels Technologies allowing new (digital)
channels and communications
Data allows understanding better
delivery forms
Revenue Longer term relationships More
Streams constant revenues
Mixed models (constant x traditional
revenue streams)
Replicable revenues
Customer Segmentation and analysis of
Segments customer preference and use patterns
based on data
Adaptation of BM depending on
customer needs (outcome-based x
traditional BM)
Back-end Key Activities Activities centered on digital
operations capabilities
Additional activities (training,
consulting, integration)
Key Resources More qualified employees (engineers,
consultant, programmers, etc.)
IT infrastructure and data analytics
Key Partners Horizontal integration
Ecosystem approach to develop and
deliver solution (especially
integrators)
Cost Structure Cost of acquiring digital capabilities
or hiring professionals
New costs related to data
infrastructure, licensing fees, and
importing
Technological Forecasting & Social Change 185 (2022) 122078
integration benefits through cloud and algorithms that optimize their
production scheduling and delivery. Data safety and security in the
implementation (whether it is cybersecurity, guidance in the technology
adoption process, or consultancy) also impact the value delivery macro-
dimension. These factors were mentioned by interviewees as points
where value can be delivered, especially with innovative solutions
within large projects. To this end, companies reported dealing with
diverging expectations and lack of security from customer with initia­
tives of jointly developing pilot projects, proofs-of-concept, referrals
from other customers and a more consultative sale (Cobots, Additive
Manufacturing, and Automation).
According to the interviewee from Automation, the customers seek
for unrealistic gains and results that have to be matched, thus, a closer
relationship, and consultative sales by directly understand the problems
Reasons and forms of these changes Source
Proofs-of-concept, pilots, referral to other customers, Cobots, Additive Manufacturing,
consultative sale and Automation, Sensor
Co-development of solutions
Sale of solutions with technology and software partners
Platforms, big data, business intelligence, and digital training Predictive AI, Additive
to improve the relationships with customers Manufacturing, Automation and
Hybrid interactions with customers Exoskeletons
Contracts for project implementation assurance Partnerships Software Integration, Cobots,
for testbeds and experimental projects and Additive Manufacturing
Digital contact channels for information and communication Sensor, Planning and
exchange (IoT, product interface, digital means) Scheduling, and Cobots
Supply Chain, Automation,
Software Integration
Use of data patterns to improve accuracy and offer complete Planning and Scheduling,
maintenance solutions Additive Manufacturing,
New revenues (with IoT, big data, sensors, or expertise) Predictive AI, Cobot
through partnerships that complement complex technology
solutions
Services of monitoring and control that allow recurring
revenues through monthly payments or based on access
Options for new revenue streams due to part of the offer being Additive Manufacturing,
digital and customizable Automation, Cobots
Replication and adaptation of algorithms, products uses and Predictive AI, Automation,
customization of parts to reach new customers, such as new Industrial IoT, Cobots
grips for cobots or AI retraining for different applications
IoT, remote monitoring, cloud computing, and data analytics Software Integration, Industrial
allow companies to differentiate customers, and to provide IoT, Additive Manufacturing,
offers adapted to each segment Predictive AI
BM change according to benefits expected and customer needs
Processes based on data (analysis, refining, integration, Planning and Scheduling,
storage) Predictive AI, Automation
Cybersecurity concerns for activities and resources Integration Sensor, Automation, Industrial
with ecosystem actors to provide parts of a whole solution IoT, Cobots, Additive
(platform, hardware, software or data solutions) Manufacturing
New sources of customer feedback and information use (use Additive Manufacturing, Cobots,
patterns) Automation, Planning and
New qualifications and expertise on emerging technologies Scheduling
(algorithms, skills, technologies)
Hardware and IoT data collection, transmission, use Industrial IoT, Predictive
Maintenance, Supply Chain
Data exchange among players Cobots, Exoskeletons, Sensor,
Knowledge transference and management among actors Automation
(training, partnerships)
Partnering with startups, IT and data providers for solutions Supply Chain, Sensor, Industrial
(pilots and experimental projects) and services of maintenance, IoT, Predictive AI, Cobots,
repair and spare parts (local delivery) Exoskeletons
Hiring or training and developing personnel to work with Planning and Scheduling,
technologies data analysis, software development, and Cobots, Software Integration,
programing Predictive AI
Increased share of variable costs (new costs of licensing fees, Sensor, Automation, Additive
data storage, importing, and partnership contracts) Manufacturing, Cobots
7
É. Marcon et al.
and analyzing the solution operability with the customers are increasing
the value perception. This change demands more efforts in relationship
building and validating solutions, thus, companies have dedicated more
efforts in building specialized teams that interact directly with cus­
tomers, such as the case of Planning and Scheduling that has engineers
in all points-of-contact with the customer, even customer support.
Whereas cybersecurity aspects have been solved with increased training
to avoid breaches and partnering with large cloud providers. However,
this aspect is yet seen as problematic for I4.0 offers (Automation, Soft­
ware Integration). Traditional BMs, on the other hand, demand a more
pragmatic view, where customers seek value delivery through failure
prediction and downtime reduction, for example (Predictive AI). In­
ventory reduction, production planning tools, software implementation,
maintenance prediction, and supply chain integration are also examples.
However, the solutions demand building trust relationships with
partners (integrators, in this case) and the customers involved in the
offer. An example mentioned by the Cobots company was the imple­
mentation of a cobot in a big company in Brazil in a partnership between
the technology provider, an engineering company, and the customer
that was conducted through two years of convincement about the im­
provements delivered in critical production processes before the
customer implemented the first cobot, after that, several others were
implemented.
4.2.2. Ecosystem integration approach in the value delivery
Ecosystem integration is also impacting I4.0 offers. This changing
factor was mentioned as important to the value delivery since inte­
grating partners in the offer of more complex solutions not only di­
minishes the risks involved, as now more actors join capabilities for
complex problems, but also allows for increased customization of solu­
tions according to customer demands. Since the I4.0 technologies
generate uncertainties to adopters, technology partners (usually base
technology providers) can aid in the implementation process and in
achieving the expected results with the technology. This proximity be­
tween providers and customers allows more customization and provides
guidance for the companies using their technologies. So, providers
become an important agent to bring partners together in an ecosystem to
offer the technology and complex knowledge necessary to deliver them.
This can be done in an ecosystem of diverse actors managed by one of
them (preferably with neutral interests), or by initiatives between
companies interested in offering a more complex solution, which will be
regulated by a contract. Sensors, Cobots and Automation are examples
of companies operating in both formats and reported gains in visibility
and new prospective customers.
Not only does this approach increase the value perception, but it also
enables providers to generate knowledge. The cases analyzed reported
developing solutions with startups, hardware, and algorithm partners to
customize solutions, but more importantly, they constantly share
knowledge and risks in the offer. This is highlighted by Supply Chain, a
partner of food retailers, that integrates data from ERP and CRM systems
and deliver products and marketing actions precisely when needed.
Also, Sensors partnered with hardware providers to co-develop complex
automation solutions.
4.2.3. Competitive positioning based on differentiation in the value delivery
Customization and servitized offers are one of the most important
factors impacting value delivery. Thus, companies consistently
mentioned that services and a customized approach are being added to
their offer to allow value to be delivered for longer periods and for
several needs of the company. Therefore, by aggregating digital tech­
nologies and partners, companies developed solutions based on differ­
entiation of offers, i.e., moving from maintenance prediction to quality
assurance, or from product printing to consultancy in the customer's
project (Predictive AI and Additive Manufacturing).
The servitized offers are also helping companies that are seeking to
build customer confidence to move to more advanced, technological
8
Technological Forecasting & Social Change 185 (2022) 122078
offers, as is the case of Software Integration company that trains in­
tegrators and even sells quality assurance solutions. For large and risky
applications, where they offer guidance and consultancy through a
service contract. Thus, the provider can ensure the quality of the final
service as the technology provider is involved in the process, especially
in projects that generate great impact on customers' operation. I4.0
technologies are essential in these cases and also in maintenance and
quality assurance services as they allow constant monitoring, data
collection and analysis and the means for the services to be delivered.
This is evidenced by Supply Chain, Predictive AI, and Industrial IoT BMs
that are improved because of the higher data availability and algorithms
available in the I4.0 context. These companies highlighted that the
constant connection, IoT sensors, AI algorithms and remote monitoring
enable them to expand their services due to the virtualization of part of
the value proposition.
4.3. Analysis of the front-end BM dimensions
4.3.1. Digital technologies in the front-end
The front-end dimensions encompass forms of contact and relation­
ship with customers. Thus, as expected, digital technologies are
important means to improve customer relationships as they are impor­
tant means to acquire data, contact customers, and improve revenue
streams based on use and uptime. Interviewees mentioned using plat­
forms, big data, business intelligence, and digital training to improve the
relationships with customers. This is the case of predictive maintenance
services provided by Predictive AI company. They report that customers
increasingly rely on the company's algorithm to conduct maintenance
activities as they begin to perceive the benefits, and the prediction ac­
curacy. Another channel for closer contact between parties was
mentioned by Additive Manufacturing which reported remotely
accessing the 3D printers to solve problems, indicate optimization pos­
sibilities in the printing process, or to give instructions to users. In the
case of the Planning and Scheduling company, the integration starts
with interconnecting customers' and providers' databases to deliver a
more integrated service through data analysis.
Companies also stated that the service developed to provide visibility
of the supply chain via cloud and data analytics enables companies to
avoid part shortages or excess, to better plan production and sales. IoT,
big data, and connected equipment ensure monitoring the performance
of the product, accessing data, and providing services such as remote
maintenance. The technologies used in these cases were associated with
analytics and communication devices such as human-machine in­
terfaces, tablets, or digital platforms (Sensor, Supply Chain and Cobots).
The constant contact with customers also improves the channels for
delivering customized offers since technology providers receive data
and feedback that allow them to tailor solutions and pivot BM faster.
This was mentioned by the Additive Manufacturing interviewee who
highlighted that their offer was initially focused on more occasional
assistance to customers, but after analyzing use patterns and demands,
they changed toward a complete solution of assistance, training and
optimization of customer's printing process. This was also the case of
Collaborative Robots that partnered with an integrator to communicate
with customers through them, and access new markets.
Companies, such as Automation and Exoskeletons reported that
customer relationships are improved because customers seek help more
constantly, have multiple means of communication, and are more
dependent of the provider, such as to determine new uses, or adapting
the operation. Based on IoT and data monitoring they can increase the
accuracy of the exoskeleton's operation and process, or the automation
system developed without necessarily being physically near, as both
companies work with international customers. Cloud storage, data
visualization tools are some of the tools used.
Customer segmentation is also impacted by digital technologies as
now customers can be distinguished based on their digital trans­
formation level (Software Integration), their patterns of adoption
É. Marcon et al.
(Industrial IoT), and investment capacity (Additive Manufacturing).
Therefore, offers can encompass companies seeking advanced technol­
ogies such as AI and predictive maintenance; and those seeking regular
offers based on the sale of the product with eventual services such as
training and maintenance. To this end, providers reported developing
BMs that can meet companies seeking more traditional offers and
making their solution smarter to reach different customers through
remote monitoring, product-as-a-service, platform integration, and
consulting and designing BMs. To this end, Additive Manufacturing re­
lies on intelligent 3D equipment that constantly exchange data through
cable connection. Exoskeletons reported investing in similar initiatives,
both to collect data and to offer this use analysis as a service to cus­
tomers interested in the data. Industrial IoT is also relying on its data
collection with IoT sensors to be able to offer customized services, since
their platform can be adapted to solutions of predictive maintenance,
quality assurance, data collection, etc. A similar approach is described
by Predictive AI and their prediction solution, which can address
different levels of demands as it enables applications on subsea moni­
toring of oil pipes, gas pipes, wind turbine failure monitoring, quality
assurance in the aluminum industry among other examples.
Thus, customer segments are expected to evolve in maturity
regarding I4.0 implementation as the technology grows, and the pro­
viders are expected to better understand the different customer needs
depending on their segments. Thus, customer segmenting through dig­
ital technologies demands analyzing data (use and demands), and add­
ing digitally-enabled flexibility to their offer to adapt the offer according
to each customer (Industrial IoT, Sensors and Cobots).
4.3.2. Ecosystem integration approach in the front-end
Customer relationships with providers also change in the I4.0
context. In this regard, due to technology uncertainties, customers seek
closer contact with suppliers to diminish insecurities based on shared-
risk contracts and to incorporate external knowledge. These actions
allow providers to deliver more advanced I4.0 BMs, such as multi-step
implementation processes that encompass tests, process improvement,
and employee training, as it is the case of cobots. Naturally, these in­
teractions are more constant, richer in shared experiences. To this end,
companies mentioned relying on mutual resources but resorting to
contract clauses that assure the correct implementation, which can be
orchestrated by the supplier with other partners. Additionally, I4.0-
related BMs demand closer customer relationships that can be impor­
tant means for technology providers to deliver consultancy services that
lead to increased value perception and more accurate solutions. These
offers are a means to leverage suppliers expertise and understanding on
different technologies and materials. Thus, a means to achieve closer
relationships toward better results is to partner with customers for
testbeds, or experimental cases to convince customers, since it is difficult
to sell a new solution. This approach was used by Software Integration,
Cobots, and Additive Manufacturing.
Also, as companies may not hold all the relevant knowledge and
capabilities necessary for operating these new technologies, the tech­
nology providers might need to partner with other companies to provide
training for the customer, which also leads to stronger relationships:
“Our supplier delivers the software for us, and we configure and
customize it for a customer, in the first level. We provide the necessary
capabilities, such as training our customers, because we are the ones who
understand the customers' needs.”
(Planning and Scheduling company)
Thus, the actors involved in the offer can share risks, but also the
revenue generated. A symbolic case was mentioned by Cobots in a
partnership with Additive Manufacturing, and Software Integrator to
provide a full solution for Sensors that involved a cobot integrated with a
MES system and a customized grip to operate on Sensor's shopfloor. The
companies shared experiences and the revenues in this process. The
ecosystems view to the operation's front-end occurs through connection
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Technological Forecasting & Social Change 185 (2022) 122078
of databases, shared BMs and the centralization of suppliers. This
networking allowed providers to find partners for joint solutions (such
as Sensor and Software Integration did to develop and MES solution
together).
4.3.3. Competitive positioning based on differentiation in the front-end
Finally, the competitive positioning based on differentiation impacts
the front-end operations. This changing factor was mentioned as
allowing new revenue streams more focused on long-term revenues that
become more recuring and predictable. Thus, providers mentioned that
the BM focus shifts from the delivery of a product to the delivery of more
complete solutions. This was mentioned by the Industrial IoT inter­
viewee in the case of the platform provided by the Predictive AI com­
pany through monitoring services, and by the Additive Manufacturing
interviewee, who stated:
“The cost-benefit ratio is becoming much more evident for hardware-
as-a-service BMs since many companies do not want to buy the
machine, because they do not know how to use it or maintain it.”
Providers highlighted that this type of BM diminishes the risks for the
customers, and also allows better assessing and predicting revenues,
charging customers based on their use necessity with IoT and algorithms
that monitor use and uptime. The digital transformation of their internal
processes also allows providers to offer services based on equipment use,
wear, or by providing remote evaluations of the solutions' condition.
One example is the case from Supply Chain, where the company in­
tegrates data to optimize and integrate supply and marketing activities.
This digital BM consists of revenues centered on information sharing and
analysis for improved supply chain and product delivery. Therefore, as
described by Planning and Scheduling and Industrial IoT, new revenue
sources are becoming more feasible. Technology providers can now
provide services over distance, such as maintenance, repair, or warranty
monitoring. When in-loco services are mandatory, these providers (or
their partners) can increase their accuracy in detecting and solving
problems and even reduce the number of workers necessary on these
tasks due to data analysis. In a complementary way, companies are also
seizing these opportunities to provide modular solutions. The companies
reported providing the addition of isolated services (i.e., consulting and
training), expanding the revenue sources, and the number of customers
interested on the solutions. Alternatively, Industrial IoT sells add-ons to
the final product, based on partnerships with analytics providers inside
their platform to add intelligence to the data in a shared revenue con­
tract. Another example previously mentioned is that of Cobots and Ad­
ditive Manufacturing jointly developing add-on parts and Software
Integration, which uses previous software structure as a basis to the offer
of their I4.0 software solution hosted on the cloud:
“The new software is modular, synergistic. It increases the potential
of the previous monitoring software. And it boosts our energy soft­
ware or our cloud service.”
A similar approach is adopted by the Predictive AI company that can
replicate their solution implemented in similar contexts with few ad­
justments, or in other branches of the adopter, such as other subsea
pipes, allowing the escalation of the solution, especially for startups.
Therefore, the use of current products or solutions into new BMs can
serve to gain new customers and provide new solutions in the market
focused on individual needs with lower costs for customizing the solu­
tions. In addition to this, the focus on offering solutions allows providers
to commit with the customer's process and results, as now, the revenue
streams become more transparent and centered on the use and results
achieved (i.e., Predictive AI, Cobots, Planning and Scheduling). One
example is that of Supply Chain company that charges customers based
on their use of the platform and the applications purchased, which im­
proves relationships and makes the provider's revenue linked to the
delivery of the solution and its benefits. Another consequence of this
approach is that the revenue streams can increase as customers realize
É. Marcon et al.
the value of the solution. Thus, due to the relational characteristic of this
approach, they usually contract more products, as reported by Software
Integration that mentioned their big data solution is an additional
feature to their MES solution; or by Cobot, that mentioned offering a
pilot (customized) solution to allow customers to understand the gains
and possibilities, to then add more services and products as the cus­
tomers see the possible benefits. Thus, as these solutions are highly
centered on digital channels, they become more easily replicable, such
as AI algorithms adaptations, additive manufacturing products, cobots
applications, etc.
According to the companies, the competitive positioning based on
differentiation allows segmenting customers based on their usage,
where up to a certain volume of use, the provider can offer the solution
as a service. However, from a certain level on, it becomes more inter­
esting to own the solution inside their company (purchase the equip­
ment, platform, or the software). I4.0 technologies such as remote
monitoring, cloud computing, and data analytics allow companies to
differentiate customers, but more importantly, allow technology pro­
viders to provide the most suitable offer to each segment as well as
diminishing the barriers to the adoption given the smaller initial in­
vestment necessary and consulting characteristics of this type of offer.
4.4. Analysis of the back-end BM dimensions
4.4.1. Digital technologies in the back-end
Interviewees highlighted that digital technologies have an important
role in back-end activities since they improve processes with a data-
centric focus. According to them, customers demand more digital in­
formation to monitor, control, and evaluate operational performance,
since this is usually the initial step for implementing the I4.0 concept (as
mentioned by Automation, Industrial IoT). According to the interviewee
of Supply Chain, digitization enables a broad set of data analyses, which
allows developing new products and services. However, data-based
processes also demand new activities that companies are not fully
accustomed to, such as customer support, product remote monitoring,
and consultancy on operational processes, since customers are not used
to implementing such technologies or cannot use them to their fullest
potential (Cobots, Exoskeleton). Some key activities now require soft­
ware providers to conduct data engineering, data refining, defining
cybersecurity measures, assistance in adapting customer's processes,
integrating different sources of data (ERP, MES) (as mentioned by
Planning and Scheduling, Predictive AI, Automation), and hardware
providers to train and assure technologies' correct use, change product
specifications based on feedback, and provide remote assistance in case
of problems (Cobots, Exoskeletons, Sensors).
The interactions with customers also bring challenges as new re­
sources are necessary to develop and manage the data and knowledge
gained from the digital technologies to cope with contractual and
cybersecurity concerns. Thus, companies reported that licensed plat­
forms for IoT data, expertise on analytics, cloud computing, contract
management, and associations with a neutral actor, such as universities
are important resources necessary for these offers (Sensor, Industrial
IoT, Predictive AI). Thus, key resources were mentioned as migrating to
more intangible assets such as a proprietary AI code and applications,
platform management, and external knowledge centered around digital
capabilities, such as patents, software codes, R&D results, and internal
knowledge (Supply Chain, Predictive AI, and Software Integration). This
is corroborated by the interviewee from the Cobots company:
“We have 65 patents on our product, most of them or many of them
are in software, so it's not only a nice hardware, but there's the
software inside the technology.”
Given the digitalized nature of these capabilities and resources
developed, companies mentioned that they seize this opportunity to
scale the solutions and replicate the offers and processes created for one
company to others. This is mainly highlighted by software and data-
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Technological Forecasting & Social Change 185 (2022) 122078
based BM, such as Sensor, Predictive AI, and Cobot programming and
customization since these companies can adapt and provide similar so­
lutions to several companies of the same sector (i.e., Oil and gas, elec­
tronics manufacturing, etc.)
I4.0 is also changing the cost structure of technology providers, since
as technologies are becoming cheaper and more popular, thus, they are
more accessible, as mentioned by Sensor, Exoskeleton, and Industrial
IoT interviewees. On the other hand, providers are demanded to hire
and train more data-related professionals, such as programmers, data
analysts to provide new BMs such as product monitoring and data an­
alytics, according to Predictive AI interviewee and Supply Chain com­
pany. These costs involve hiring training companies, acquiring courses
and providing time for these professionals to learn data science, Ardu­
ino, 3D printing, etc.
Some interviewees stated that technology remains expensive as
taxation in Brazil is high on technology supplies:
“The companies need to import, and we have many taxes, so they
need to add this to their cost.”
(Automation interviewee)
According to Sensor's CEO, the total cost for an imported solution in
Brazil may rise from 30 % to 70 %, which leads to lower competitivity.
The exchange rate flow was another source of unexpected costs for
technology providers, as several technologies are imported. However,
Sensors and Software Integration mentioned that governmental credit
lines and innovation policies are means used by companies to diminish
these costs, finance innovation, and improve their internal processes, as
they are subsidized and publicly accessible for industrial players.
4.4.2. Ecosystem integration approach in the back-end
The back-end is also impacted by the need for integrating and
becoming closer to partners and customers, since providers are
demanded to integrate their infrastructure, develop interaction mecha­
nisms, and operationalize the horizontal integration with other actors
for I4.0 offers. Thus, key activities are changed since other actors are
involved in providing the solutions. One example is from Sensor that
partnered with a cloud solution provider to offer cloud services for
customers in integration with their original offer. Predictive AI also re­
ported that demand was increased when they were able to partner with
the cloud platform offered by a major IoT player, which enabled them to
reach a broader set of customers with their standard algorithm
employing little extra resources. This type of BM demands efforts to
integrate their solution within an ecosystem as they provide parts of a
whole solution (platform, hardware, software or data solutions). Soft­
ware Integration (software expertise), for example, operates with
Automation (hardware expertise) to jointly provide an MES solution
from Sensor (IoT and communication expertise), where each actor
operates one part. The partnership between Additive Manufacturing and
Cobots is another case that was described as demanding integrating
resources, staff and customer demands to offer the solution.
Thus, providers mentioned that even though these key resources can
be acquired and developed internally, partnerships and contracts with
external actors that already have the expertise on the fields (especially
for I4.0 base technologies of IoT, cloud, analytics and hardware) is faster
and more reliable.
“We also sell quality assurance, that is when the integrator is not very
comfortable with a very large application, so we offer some guid­
ance. We also have software certification.”
This is the case of Sensors, that created a new prediction division that
is a result of a startup investment made by the company to build the
resources they needed to develop a new BM. Cobots also partnered with
an integrator to expand their implementation capabilities and their
knowledge on the industrial applications in Brazil. Providers also
mentioned that new activities emerge as data and technology activities
now supplement physical activities (maintenance, customers support,
É. Marcon et al.
and training). To this end, Planning and Scheduling mentioned investing
more in training and providing customer support based on direct
connection with the customer's system. Maintenance of hardware and
software also demand connecting and interacting with the customer's
infrastructure remotely, directly or through partners when providers are
not physically close (Cobots, Exoskeletons). When partners are an
important actor in the provider's solution, knowledge transference and
management through training, performance agreements, and shared
resources (systems and data access) is mentioned as essential (Cobots,
Automation, Exoskeleton). Especially in the cases of foreign companies
with products that demand maintenance.
The resources needed are also changed by the ecosystem approach,
since partnership and outsourced services allow providers to develop
resources and incorporate them to more complex offers without
increased investments. Also, since these resources tend to be mostly
intangible, digital, and knowledge-based, all of the actors benefit from
the resource exchange as they become more proficient in innovative
technologies and capabilities at the same time that they build compe­
tences to innovate their BM using them. In the partnership between
Sensors and Software Integration for the development of an MES solu­
tion the former was a testbed company for the implementation of sys­
tem. The Cobots solution was then connected to this system to test its
suitability. The result from the partnership was that both companies
improved their processes. Software Integration validated their solution
based on the feedback of the system's usability, inexistent features and
cloud performance; whereas Sensor was able to use the system and
develop production planning and control knowledge of their system to
train engineers and the staff to implement improvements. Cobots also
provided the equipment and the knowledge necessary to operate it. All
of the companies benefited from exchanging engineering knowledge,
software and physical resources among the ecosystem, which dimin­
ished the risks associated to developing the BM offer internally.
Also, startups are important partners for flexible co-development;
equipment providers are important hardware partners; and base tech­
nology companies such as IoT and AI also contribute to the development
of more complex offers with the infrastructure necessary for the oper­
ation and the expertise. One example of how offers demand a network is
brought by Sensor company. According to the company, the imple­
mentation of a robot solution, which was not their expertise, led them to
develop a partnership between the company and two external partners,
a robot provider, and a programmer, to deliver the solution. This form of
partnering is corroborated by the Predictive AI interviewee, who joined
an Industrial IoT platform to deliver their solution to more customers.
Also, the partners' importance is amplified as Software Integration cer­
tifies partners so they can develop parts for the cobots sold, increasing
the company's offer. As highlighted by Software Integration's
interviewee:
“We realized that when we talk about Industry 4.0, it involves many
actors, involves much knowledge. So, being inside a network with
different kinds of knowledge strengthens us and makes us stronger in
our area; however, combining this expertise is a great challenge.”
In the Exoskeleton and the Predictive AI cases, key partners even
found new solutions applications and allowed the providers to develop
new BMs by learning with the needs of these partners (i.e., logistics use
in palletizers). Therefore, providers search for more cooperation and
partnerships in associations, innovation clusters, and I4.0 ecosystems to
develop partnerships. These institutions allow formalized contact be­
tween providers, competitors, technology agencies, consultants and
universities. The partnerships developed in this ecosystem allowed
companies to gain access to new markets and the possibility to improve
their BM with digital technologies that they could not fully provide
without partners. However, providers highlight that an important
challenge related to this aspect is the costs involved and how to oper­
ationalize the partnership necessary to deliver offers provided by mul­
tiple actors, since they demand back-end activities of data integration,
11
Technological Forecasting & Social Change 185 (2022) 122078
contract management and quality assurance in the interactions. These
activities, and the shared costs that they might pose to companies is an
important cooperation barrier. Thus infrastructure development, in­
vestments, shared technologies, and most importantly, information and
data privacy demand concerns that some companies might not be pre­
pared or open to discuss.
4.4.3. Competitive positioning based on differentiation in the back-end
Finally, despite fewer mentions to the changing factor competitive
positioning based on differentiation in the back-end operations, in­
terviewees mentioned that its impact is mostly associated to how new
key activities are necessary to operationalize the servitized offers, as
now data analysis activities are necessary to make solutions smarter.
Customer training, consulting, maintenance, remote monitoring, and
new product development for innovation activities were also mentioned
by several interviewees as new activities that demand time and skills but
that provide important value to customers. The services are provided for
demand-specific projects or hours and are based on the technical
expertise of the providers. For Additive manufacturing, this means
assistance in design products to be printed, or analyzing demands that
could be solved with 3D-printed products. For Exoskeleton, this means
analysis of the ergonomics designs of tasks in the customer and their
improvement for the use of the product. Additive Manufacturing
described that this initiative brought benefits:
“We added a consultancy hours service to ensure that customers will
benefit more from that technology, so now we do not only deliver the
machine and the maintenance.”
Other activities related to the necessary processes to operationalize
the potential of the digital transformation of back and front-end pro­
cesses were mentioned. Thus, these key activities linked to I4.0 tech­
nologies demand a process of convincing the customer of their
effectiveness, as well as that providers build solid offers based on mutual
trust and data analytics to show how valuable their offers can be to
customers. This is stated by Sensor company that describes that initially
customers only want to understand machine availability, then when
they perceive value in the data-based approach, they search information
involving equipment efficiency, employee work optimization, and
product traceability.
The key resources related to servitization, and customization are
mainly centered around developing service capabilities for contacting
and exchanging value with customers. Results showed that employing
adequate employees for these activities is an important key resource, as
I4.0 offers demand engineering and operation consultancy, production
expertise and systemic integration among different offers. In this sense,
the resources necessary are usually new and unknown due to technology
innovativeness. Thus, key partners can aid in acquiring and providing
the capabilities and services as highlighted by Exoskeleton, Cobots, and
Supply Chain, since their network of local suppliers and partners is
essential to deliver closer and more customized contacts with customers
in regional markets. Regular visits, maintenance calls, spare parts sup­
ply, and specific demands are some of the means local partners are used
for this end.
Finally, providers mentioned that development costs are changing
from purchasing and outsourcing to more collaborative forms, such as
licensing fees paid to providers of solutions (Planning and Scheduling).
In this case, the company pays to the developer of the solution a fee for
the software they customize. Supply Chain and Predictive AI also
mentioned relevant costs related to web servers due to their necessity of
storing and processing on the cloud. Other costs involved in the I4.0
offers are related to the development of solutions that encompass en­
gineering hours, customer support and connection, importing, and back-
end innovation changes (Exoskeleton, Additive Manufacturing and
Sensors). Thus, costs of development and improvement become more
variable and demanded upon customer necessity, such as custom­
izations, or new processes that demand changes in the operation, as
highlighted by Planning and Scheduling. The companies also mentioned
É. Marcon et al.
that since their offers are becoming more service-centered, they must
deploy more efforts in changing back-office processes, training the team
and adapting the workflow due to the recurrent interactions needed in
servitized offers (i.e., customer support, interaction platforms, emer­
gency hotlines).
5. Discussion
Our results showed that the I4.0 technologies and solutions impact
the whole BM system. Companies can expect major changes in their
revenue sources and the capabilities necessary for providing such an
offer (Marcon et al., 2019; Sjödin et al., 2021). Key partnerships, value
propositions, customer segments, key activities, and customer relation­
ships were the most mentioned. Such results are complementary to the
findings of Metallo et al. (2018). They found that in the IoT industry,
companies' most critical building blocks are the key activities, value
proposition, and key resources, as companies struggle with aspects of
infrastructure management and product areas when creating and
capturing value. Moreover, the results show that the BM dimensions are
impacted differently according to each changing factor. Firstly, digital
technologies impact all dimensions. Still, as the interviewees high­
lighted, these technologies impact more intensively the back-end oper­
ations as they allow processes and activities to be more automated and
accurate due to the focus on data, allowing to more closely integrate
customer processes and infrastructure. Previous studies mentioned that
advanced digital technologies such as AI impact BM's back-end,
demanding critical algorithm development capabilities, technology
democratization through collaborative application development, and
data management (Sjödin et al., 2021). Our study builds on these results
and brings other impacts to the back-end macro-dimension. We also
complement the finding of Dalenogare et al. (2022), that stated that
companies offering I4.0 solutions must use multichannel digital services
supported by the integration of real-time data from service ecosystems.
To this end, cloud services are an important means for hardware-based
solutions since they operate as an internal information-processing
capability for the back-end information-processing needs. Our study
shows how companies integrated back-end operations through platform
solutions, data exchange, and integration with other actors to provide
the BM. Thus, some of the back-end changes necessary are analytics,
assistance in customer processes, and staff investments.
Digital technologies also impact the front-end as they make revenues
based on data sharing and analysis possible and constant validation of
solutions through remote connection with customers. Thus, new forms
of revenue are also expected since, with IoT and big data's ubiquitous
connection capability, technology providers can leverage real-time data
to develop BM based on machine availability, productivity, or use (Lerch
and Gotsch, 2015). Value delivery operations are changed as data brings
new possibilities for building competitive advantages based on auto­
mation with algorithms and capabilities for innovative offers through
AI, performance assurance contracts, or other forms of customized BM.
In this sense, the delivery of these offers is highly improved by digital
technologies (Grubic, 2018). For example, in the case of autonomous
trucks, digital technologies will allow a customized customer interface
and service delivery that can be a source of new revenues and value
addition through customer interaction with digital technologies such as
navigation services, sensing and scanning to provide data for the prod­
uct's management (Fritschy and Spinler, 2019).
Digital technologies can also improve the front-end by allowing BM
pivoting, such as changing key features, for example, billing forms from
pay-by-access and licenses to annual subscription plans (Şimşek et al.,
(2022) or remote changes to the product operations and algorithms, as
explained in the cases of Cobots and Supply Chain. Technologies such as
wearables and virtual tools for maintenance activities or installation are
examples of I4.0 technologies for front-end operations. Digital solutions
in smart products can even substitute the use of these technologies by
embedding these services directly into the product (Dalenogare et al.,
12
Technological Forecasting & Social Change 185 (2022) 122078
2022). Our results add to previous literature by showing how front-end
operations allow companies to deliver innovative BMs. We show that
data exchange and customer connection (product interface, digital
platforms) are used by companies to allow customized interactions and
address customer needs more closely. Moreover, partners allow
increasing the possibilities of front-end operations by complementing
the offer with new services (maintenance, optimization), software (an­
alytics and monitoring), and hardware (IoT, modular parts, and spare
parts). However, new procedures, software and systems to assure secu­
rity concerns such as unauthorized access, data manipulation, and data
destruction are increasingly important and challenging (Kiel et al.,
2017).
The results also showed that the changing factor ecosystem inte­
gration approach is concentrated in front- and back-end macro-di­
mensions. Back-end processes focus on integrating actors and managing
the knowledge and interactions that allow solutions operationalization.
This is in line with recent research that points out that for advanced
technologies, such as AI, partnerships with other players and developing
a network of actors are essential to make solutions scalable and rapidly
expand the user base of providers (Sjödin et al., 2021). Also, companies
that acquire external knowledge are better prepared to engage in
exploitative and explorative innovation strategies, which enable them to
redesign their BMs toward efficiency and novelty (Müller et al., 2020).
To acquire external knowledge, a complementary approach (other than
developing internally) is through partnerships with providers, as in the
case of a platform provider that improves the pool of services offered
with partners that deliver new services for more customers. To this end,
absorptive capacity is increasingly important (Şimşek et al., 2022). Also,
connecting with customers, partners, and even competitors is a key
factor in absorbing knowledge, given that I4.0 solutions are broad in
scope and divergent capabilities necessary (Benitez et al., 2021), as well
as the possibility of decreasing cost from key resources and key activities
of new offers.
Finally, the results from the positioning based on the differentiation
changing factor showed a predominant impact on the value proposition
dimension, even though servitized and customized offers demand in­
novations in the other dimensions. Our results showed that a service-
centred approach allows providers to change their view toward adding
value to customers (Frank et al., 2019b). To this end, the literature
showed that companies must develop several service capabilities, such
as building trust with customers by providing services attached to ex­
pected outcomes, service portfolio broadening (with in-person and
digital processes), and coordination with third parties (Marcon et al.,
2022). These capabilities rely on remote monitoring technologies, smart
product connections and information systems for data exchange (Lerch
and Gotsch, 2015; Marcon et al., 2022; Porter and Heppelmann, 2014)
and customized offers that are more focused on the value delivered
instead of the sale. This approach allows value delivery through smart
products that collect and use customer information to improve their
performance and customization (Ibarra et al., 2018; Kahle et al., 2020).
Literature shows that some of these BMs can be predictive maintenance,
product upgrades, spare parts order, and remote maintenance. Cus­
tomers can become a part of the value co-creation process (Ibarra et al.,
2018). This change opens space for solutions attached to the original
offer that assure the customer's problem is addressed, such as consulting,
specific training, assistance, and hotline service for emergencies (Frank
et al., 2019b; Lerch and Gotsch, 2015), retaining customers and creating
barriers for new competitors.
Therefore, providers can extend their relationship with the customer
(Kiel et al., 2017). To this end, suppliers can rely on IoT platforms that
provide connectivity (through data collection hardware) and the means
to collect and analyze data through cloud connection and algorithms
(Şimşek et al., 2022), or smarter products that can communicate with
the customer through interaction points, such as screens and virtual
reality (Dalenogare et al., 2022), In this sense, both actors benefit since
providers gain customer loyalty and more recurring revenue streams
É. Marcon et al.
and customers can take advantage of the provider's knowledge of the
product to achieve security, optimize implementation, or co-develop
new solutions. Our results add to the literature by showing not only
the servitization idiosyncrasies, such as the capabilities necessary
(Marcon et al., 2022) or the type of offer and technology (Frank et al.,
2019), but expanding the analysis within the I4.0 BM change as a whole,
comprising the technologies, the partnerships necessary, and the form
and changes needed to the offer that are necessary to the BM delivery.
Our findings complement Metallo et al. (2018), which described the
critical factor for value creation and capture. Their findings indicate that
value propositions and key activities are BMs' most important building
blocks. Their analysis showed that incumbent/newcomer companies
usually focus on a specific technology, whereas larger and older firms
can exploit internal synergies and complementarities to create value.
Moreover, the infrastructure management, product areas, and value
proposition are where these companies differ when creating and
capturing value. We add to these results by showing how and why
companies can change their BM building blocks through a broader view
of the solution from the back-end operationalization to the front-end
value operationalization and the value delivery itself. We show the
technologies used, how partnerships took place, the services attached to
the BM, and how companies orchestrated these factors, as the offer of
I4.0 solutions is not an easy nor a linear process. Thus, providers must
consider the intricated relationship between all of the BM components,
the back-end, the front-end, and the value delivery, and connect these
components with the capabilities developed (Metallo et al., 2018; Sjödin
et al., 2021). This is especially true for I4.0 BM since it is still a new
concept with technologies that are not fully integrated and understood
(Tabim et al., 2021). This level of change in BM coordination was not
seen in previous industrial revolutions or with innovative technologies
alone; hence, the increased importance of suppliers connecting all the
components of their BM. However, some companies opt to offer up­
grades to their regular offers, such as including improvement services
based on the data collected (such as the case of Additive Manufacturing)
or complement their offer, such as Planning and Scheduling, with their
ML algorithm addition to their regular solution. We argue that these
complementary innovations can limit the innovative potential of the
technologies if a well-defined strategy is not present (Marcon et al.,
2022).
6. Conclusion
This article has addressed the impacts of three major changing fac­
tors on the BM of I4.0 technology providers. We studied how I4.0 sup­
pliers changed their BM's value delivery, front-end and back-end
activities to cope with the changing factors of digital technologies,
ecosystems perspective, and differentiation through customization and
servitization. We show that digital technologies allow processes and
activities to be more automated, as well as new value delivery forms
through the cloud, data analytics and algorithms based on AI and remote
monitoring. We show that customer companies expect more advanced
offers focused on providing solutions and not only on selling products or
single technologies. Consequently, customer relationships become
closer and more relational. Thus, service and data analytics capabilities
are essential to provide broader and smarter solutions, such as product
monitoring, predictive maintenance, and optimization. Such capabilities
are necessary since I4.0 solutions are heavily supported by the factory's
digital transformation and the integration of the available data.
We also show how the three changing factors impact the macro-
dimensions. We demonstrate how technologies translate into solutions
that mix algorithms, software, hardware, and service capabilities to
create innovative BMs such as IoT algorithms platforms for AI and ad­
ditive manufacturing consultancy. Thus, even though I4.0 brings chal­
lenges due to technical complexity, cybersecurity concerns,
infrastructure, and new processes based on data, their BM innovations
possibilities allow bringing new sources of customer information,
13
Technological Forecasting & Social Change 185 (2022) 122078
customer proximity and loyalty, integration with partners, and
extended/recurrent revenue streams that permit important competitive
advantages for industrial players. To deliver these BMs, providers should
significantly improve their value delivery through customized services
and interactions and digital assets and resources to increase the capa­
bility of co-creating value with customers based on their use demands.
Front-end operations will demand hybrid interactions supported by
increased product intelligence and data exchange, while they will de­
mand multiple actors to create and deliver the offers jointly. Also, pro­
viders must improve back-end processes with digital resources and open
their BMs to offer solutions with partners. The customer-oriented sup­
port, training, and consulting activities are also important changes for
these BMs.
6.1. Recommendations for future studies and research limitations
Following our findings, we suggest studies focus on how I4.0 offers
demanded internal changes considering socio-technical aspects, such as
personnel, organization, and environmental aspects that were impacted,
including leadership changes, training demands, employee capabilities
necessary, etc. Moreover, further research could analyze the role of IoT
and machine learning in offering I4.0 BMs, as more services are
dependent on contextual data, and innovative BMs can be developed
using both technologies for basic and more advanced services that
integrate more than one actor. Finally, we encourage future studies to
analyze the risks associated with offering I4.0 BMs, such as data privacy,
unanticipated investments, long-term contracts, market turbulence, and
technological complexities.
As a limitation of our study, the context analyzed can be a general­
ization inhibiting factor, as developing countries are expected to show
individual patterns, usually different from those seen in the developed
country's context. However, this study sought to overcome or diminish
the specificity by addressing several multinational and non-Brazilian
companies. The qualitative characteristic of the method should also be
considered a limitation, even though this type of exploratory problem is
better approached through qualitative optics, given its openness and
possibility to dive deeper into results that were not expected during the
initial phases of the study.
6.2. Managerial implications
Our article proposes important changing factors that providers must
consider in their offers and the impacts of providing I4.0 BMs on each
macro-dimension. Thus, providers should consider the effects analyzed
in this article of how digital technologies change their back-end process,
which allows new processes and innovation based on the data collected
to improve their offers. An example is using customer data analytics to
anticipate maintenance or improve products based on performance
feedback. Our article also shows new capabilities, and challenges pro­
viders can face when offering I4.0 BMs. We also highlight the need for
providers to become more open to collaborations and constant in­
teractions. In this process, associations, partnerships, and innovation
ecosystems are important to provide a favorable environment for these
I4.0 innovations.
The ecosystems can deliver new offer possibilities for companies that
are focused on hardware and want to complement their offer with
software or the opposite. Moreover, providers of solutions can reach
more customers by integrating partners that can provide IoT and cloud
capabilities, for example. The implications of this openness, however, is
the need for providers to develop mechanisms to cooperate (contracts,
agreements and platforms) while maintaining competitive advantages
and data security. On the competitive positioning based on differentia­
tion, our results show a trend of companies attaching more digital ser­
vices to their offers. This also brings implications as companies must
develop service competencies (closer connections, more data exchange,
focus on value instead of products), change the revenue periodicity and
É. Marcon et al.
leverage more customer visibility to improve their products and ser­
vices. Finally, the concept of allowing and bonding the others, digital
technologies, change the whole value delivery perspective. However,
developing systems, AI algorithms, collecting data and using it is
complicated and demands investments in training, hiring staff, and
absorbing knowledge, which tends to be easier for more structured
companies.
Declaration of competing interest
All authors of this paper declare that they have no conflict of interest.
Data availability
No data was used for the research described in the article.
Acknowledgements
This research has been financially supported by the Brazilian Na­
tional Council for Scientific and Technological Development – CNPq
(Productivity scholarship and PhD scholarship for two of the authors).
Appendix A. Interview guideline
1) Could you provide a brief overview of the company's history and
current activities, including markets, technologies provided and
relationship with Industry 4.0?
VALUE PROPOSITION
1) Can you describe the impacts of your products or services on your
customers?
2) What are the reasons why companies are acquiring your products or
services?
a. What purposes or activities is your offer used for?
b. In which business functions are they used (e.g., design, produc­
tion, service, and distribution).
3) How is the adoption of your products or services enabling the
adoption of new business models for your customers?
4) Do your products or services create opportunities for new products or
markets?
5) What kinds of companies are acquiring the products and technolo­
gies your company offers (sectors, names, etc.)?
a. How did I4.0 change your customer segments?
FRONT-END OPERATIONS
1) How do you interact with your customers?
a. What are the relationships your company usually has, and how
did I4.0 change them?
2) How are technologies allowing new channels to contact customers?
a. Did I4.0 allow Integrated channels (digital + physical)?
b. How do they work in you company?
3) What are your sources of revenue?
a. How did I4.0 change your revenues (periodicity, size, forms of
charging, etc.)?
b. Do you provide services attached to your offers?
BACK-END OPERATIONS
1) What are the activities necessary to provide your I4.0 BMs?
a. How is I4.0 changing or demanding new activities for your offers?
b. Are they usually done in person or remotely?
2) What resources or requirements your company needs to provide your
products or services?
14
Technological Forecasting & Social Change 185 (2022) 122078
a. What technologies, products, and/or services are necessary for
your company offer I4.0 BMs?
3) How is your company engaging with others in Industry 4.0? Are you
collaborating or linking your products with the products of others?
a. Do you collaborate with your suppliers or customers on new
products or services?
b. What kind of suppliers are the most important for your offer?
4) What are the costs linked to your offers (import, taxes, personnel,
hardware)?
a. Did I4.0 make them higher or lower? Why?
b. Do you pay technology licensing fees to technology suppliers?
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Érico Marcon, M.Eng., is a PhD candidate in Industrial Engineering at the Federal Uni­
veristy of Rio Grande do Sul (UFRGS) – Brazil, and a researcher of the Organizational
Engineering Group (NEO – Núcleo de Engenharia Organizacional) from the Department of
Industrial Engineering at UFRGS. He has a bachelor degree in Business Administration
from Universidade de Passo Fundo and a Master degree in Industrial Engineering from
UFRGS. His main research is concerned with the digitalization of Product-Service Systems.
Marie-Anne Le Dain, Ph.D. is Associate Professor of Engineering Design and Management
at the Grenoble Institute of Technology and a member of the G-SCOP Lab. She was a
visiting professor at Queensland University of Technology and Bath University. She is a
member of the Design Society and the IPSERA and AIRL-SCM associations. Her research
has focused on collaborative design with suppliers in new product development and more
currently in digital service-product system development.
Alejandro Germán Frank, Ph.D. is an Associate Professor of Industrial Organization at
the Department of Industrial Engineering of the Federal University of Rio Grande do Sul
(UFRGS) – Brazil and a Research Affiliate at the Industrial Performance Center of the
Massachusetts Institute of Technology (USA). At UFRGS, he is also the director of the
Organizational Engineering Group (NEO – Núcleo de Engenharia Organizacional). He has
been a visiting scholar at the Massachusetts Institute of Technology (USA), and at Poli­
tecnico di Milano (Italy). His research is devoted to the interface between operations and
technology management, with emphasis on digital transformation, Servitization, Industry
4.0, and new business models in manufacturing firms.