Business Model Innovation as a

Dynamic Capability: Micro-Foundations

and Case Studies Marc Sniukas
Visit to download the full and correct content document:
https://textbookfull.com/product/business-model-innovation-as-a-dynamic-capability-
micro-foundations-and-case-studies-marc-sniukas/
More products digital (pdf, epub, mobi) instant
download maybe you interests ...

RESTART Sustainable Business Model Innovation Sveinung

Jørgensen

https://textbookfull.com/product/restart-sustainable-business-
model-innovation-sveinung-jorgensen/

End-to-End M&A Process Design: Resilient Business

Model Innovation Thorsten Feix

https://textbookfull.com/product/end-to-end-ma-process-design-
resilient-business-model-innovation-thorsten-feix/

Behavior Space Play Pleasure and Discovery as a Model

for Business Value 1st Edition Manu

https://textbookfull.com/product/behavior-space-play-pleasure-
and-discovery-as-a-model-for-business-value-1st-edition-manu/

Service Business Model Innovation in Healthcare and

Hospital Management Models Strategies Tools 1st Edition
Mario A. Pfannstiel

https://textbookfull.com/product/service-business-model-
innovation-in-healthcare-and-hospital-management-models-
strategies-tools-1st-edition-mario-a-pfannstiel/
Business Model Design Compass Open Innovation Funnel to
Schumpeterian New Combination Business Model Developing
Circle 1st Edition Jinhyo Joseph Yun (Auth.)

https://textbookfull.com/product/business-model-design-compass-
open-innovation-funnel-to-schumpeterian-new-combination-business-
model-developing-circle-1st-edition-jinhyo-joseph-yun-auth/

People Capability Maturity Model A Framework for Human

Capital Management 3rd Edition Bill Curtis

https://textbookfull.com/product/people-capability-maturity-
model-a-framework-for-human-capital-management-3rd-edition-bill-
curtis/

Progress in Performance Management Industry Insights

and Case Studies on Principles Application Tools and
Practice Marc Helmold

https://textbookfull.com/product/progress-in-performance-
management-industry-insights-and-case-studies-on-principles-
application-tools-and-practice-marc-helmold/

Nanomaterials for Clinical Applications: Case Studies

in Nanomedicines (Micro and Nano Technologies) 1st
Edition Costas Demetzos (Editor)

https://textbookfull.com/product/nanomaterials-for-clinical-
applications-case-studies-in-nanomedicines-micro-and-nano-
technologies-1st-edition-costas-demetzos-editor/

Supply Chain Management Models: Forward, Reverse,

Uncertain, and Intelligent Foundations with Case
Studies Hamed Fazlollahtabar

https://textbookfull.com/product/supply-chain-management-models-
forward-reverse-uncertain-and-intelligent-foundations-with-case-
studies-hamed-fazlollahtabar/
Contributions to Management Science

Marc Sniukas

Business Model
Innovation
as a Dynamic
Capability
Micro-Foundations and Case Studies
Contributions to Management Science
More information about this series at http://www.springer.com/series/1505
Marc Sniukas

Business Model Innovation

as a Dynamic Capability
Micro-Foundations and Case Studies
Marc Sniukas
Alliance Manchester Business School
Manchester, UK

ISSN 1431-1941 ISSN 2197-716X (electronic)

Contributions to Management Science
ISBN 978-3-030-50099-3 ISBN 978-3-030-50100-6 (eBook)
https://doi.org/10.1007/978-3-030-50100-6

© The Editor(s) (if applicable) and The Author(s), under exclusive licence to Springer Nature Switzerland
AG 2020
This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether
the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of
illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and
transmission or information storage and retrieval, electronic adaptation, computer software, or by
similar or dissimilar methodology now known or hereafter developed.
The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication
does not imply, even in the absence of a specific statement, that such names are exempt from the relevant
protective laws and regulations and therefore free for general use.
The publisher, the authors, and the editors are safe to assume that the advice and information in this
book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or
the editors give a warranty, expressed or implied, with respect to the material contained herein or for any
errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional
claims in published maps and institutional affiliations.

This Springer imprint is published by the registered company Springer Nature Switzerland AG.
The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland
Acknowledgements

First, I would like to thank my supervisors Drs. Helen Perks and Kathleen Keeling
for their guidance on my journey towards crafting this thesis. Helen introduced me to
the world of dynamic capabilities early on, while both provided valuable feedback
on drafts of the chapters you are about to read, pointed me towards potential
directions when I was stuck and pushed me to go further than I might have been
willing to go at times.
Thanks also go to Dr. Panos Desyllas for early comments on the literature review
and for giving me the advice that I do not necessarily have to write it up the way I did
my analysis. The first of many vital lessons learnt.
I am deeply grateful to the research participants for their time and patience in
answering my questions. Special thanks go to Dr. Daniel Liedtke for his particular
interest in participating in this research, taking the time to provide feedback on my
findings and granting me generous access to his organisation.
Last, but certainly not least, I thank my family and my wife for their support and
patience, particularly during my many moments of being preoccupied throughout
our joint DBA years.

Marc Sniukas

v
About This Book

This study adopts a dynamic capabilities perspective to explore the activities and
processes through which business model innovation arises in established
organisations.
New and innovative business models are fundamental to the commercialisation of
latest technologies, performance and competitive advantage, as well as the creation
of value for customers, the focal company and its ecosystem. Yet, our current
understanding of how established companies design and implement new business
models is limited by a lack of empirical research.
The dynamic capabilities perspective offers a promising route to investigate the
managerial and organisational activities and practices through which business model
innovation is enacted.
Based on a review of the business model, business model innovation and dynamic
capabilities literature, business model innovation is framed as a dynamic capability
and research questions are developed.
These questions are investigated using grounded theory methodology, collecting
and analysing data from five case studies from the manufacturing, financial services,
media, consulting and healthcare industries.
Findings from an initial sample suggest a business model innovation process
consisting of an inception, evolution and diffusion phase, encumbered by cognitive,
emotional and behavioural challenges. Linking the findings to the dynamic capabil-
ities perspective, three micro-foundations, namely, process orchestration, learning
and deployment mechanisms, are identified.
Findings from a subsequent theoretical sample not only unravel the underlying
managerial and organisational activities of these micro-foundations, but also reveal
further details on the challenges faced, as well as the key role of senior management
for orchestrating and enacting this process and its underlying activities.
Considered collectively, the findings offer a novel understanding of how business
model innovations come about in established organisations, a practice labelled
‘crafting business models in statu nascendi’.

vii
viii About This Book

The book closes with a discussion and synthesis of the findings, the theoretical
contribution and managerial implications, as well as limitations of this study and
areas for future research.
Contents

1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Problem Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1.1 The Increasing Interest in the Business Model Concept . . . . 2
1.1.2 The Importance of Business Model Innovation . . . . . . . . . . 3
1.1.3 Business Model Innovation in Established Companies . . . . 5
1.1.4 Gaps in Business Model Innovation Research . . . . . . . . . . . 7
1.1.5 Business Model Innovation as a Dynamic Capability . . . . . 8
1.1.6 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.2 Research Area and Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.2.1 Purpose of this Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.2.2 Academic Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.2.3 Managerial Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.3 Book Outline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2 Literature Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.1 Approach to Literature Review . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.1.1 Data Collection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.1.2 Data Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.2 Four Perspectives on the Business Model Phenomenon . . . . . . . . . 22
2.2.1 The Static Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.2.2 The Dynamic Perspective . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.2.3 The Strategic Perspective . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.2.4 The Operational Perspective . . . . . . . . . . . . . . . . . . . . . . . 33
2.3 A Framework of Business Model Innovation . . . . . . . . . . . . . . . . . 34
2.3.1 Defining Business Model Innovation . . . . . . . . . . . . . . . . . 34
2.3.2 The Process of Business Model Innovation . . . . . . . . . . . . . 36
2.4 Framing Business Model Innovation as a Dynamic Capability . . . . 36
2.4.1 Defining Dynamic Capabilities . . . . . . . . . . . . . . . . . . . . . 37
2.4.2 Business Model Innovation as a Dynamic Capability . . . . . 38

ix
x Contents

2.5 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
2.6 Research Questions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
3 Research Design and Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . 45
3.1 Research Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
3.1.1 Ontological and Epistemological Positioning . . . . . . . . . . . 45
3.1.2 The Nature of the Research Question . . . . . . . . . . . . . . . . . 46
3.1.3 Methodological Implications . . . . . . . . . . . . . . . . . . . . . . . 47
3.2 Research Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
3.2.1 Stage 1: Initial Sample . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
3.2.2 Stage 2: Theoretical Sample . . . . . . . . . . . . . . . . . . . . . . . 58
3.2.3 Theoretical Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
3.3 Evaluating Grounded Theory Research . . . . . . . . . . . . . . . . . . . . . 62
3.3.1 Rigour . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
3.3.2 Relevance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
4 Findings from the Initial Sample of Five Research Sites . . . . . . . . . . . 67
4.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
4.2 Research Sites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
4.2.1 Site 1: The Private Hospital . . . . . . . . . . . . . . . . . . . . . . . . 68
4.2.2 Site 2: The Media Investment Corporation . . . . . . . . . . . . . 70
4.2.3 Site 3: The Electronics Manufacturer . . . . . . . . . . . . . . . . . 70
4.2.4 Site 4: The Financial Services Company . . . . . . . . . . . . . . 72
4.2.5 Site 5: The Innovation Consultancy . . . . . . . . . . . . . . . . . . 73
4.3 Patterns of Business Model Innovation Processes in Established
Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
4.3.1 The Inception Phase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
4.3.2 The Evolution Phase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
4.3.3 The Diffusion Phase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
4.3.4 Process Management and the Role of Top Management . . . 113
4.4 Discussion and Synthesis of Findings from the Initial Sample . . . . . 115
4.4.1 The Nature of the Process of Business Model Innovation
in Established Companies . . . . . . . . . . . . . . . . . . . . . . . . . 115
4.4.2 The Challenges and Complexities Inherent to Enacting
this Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
4.4.3 The Micro-foundations and Their Underlying Managerial
and Organisational Activities and Practices . . . . . . . . . . . . . 118
4.4.4 The Role of Top Management . . . . . . . . . . . . . . . . . . . . . . 120
4.4.5 Preliminary Framework of the Micro-foundations
of Business Model Innovation as a Dynamic Capability . . . 120
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
5 Findings from the Theoretical Sample of One Research Site . . . . . . . 123
5.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
5.2 Process Orchestration and the Role of Top Management . . . . . . . . 124
Contents xi

5.2.1 Providing Direction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124

5.2.2 Involving the Organisation . . . . . . . . . . . . . . . . . . . . . . . . 127
5.3 Learning Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
5.3.1 Management Workshops . . . . . . . . . . . . . . . . . . . . . . . . . . 127
5.3.2 Discussions and Meetings . . . . . . . . . . . . . . . . . . . . . . . . . 136
5.3.3 Data Search and Collection . . . . . . . . . . . . . . . . . . . . . . . . 140
5.3.4 Creating Visual Representations . . . . . . . . . . . . . . . . . . . . 142
5.4 Deployment Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
5.4.1 Establishing a Meeting Structure . . . . . . . . . . . . . . . . . . . . 149
5.4.2 Adapting Organisational Structures and Processes . . . . . . . . 158
5.4.3 Department Meetings and Workshops . . . . . . . . . . . . . . . . 161
5.4.4 Middle Management and Associates Workshops . . . . . . . . . 163
5.4.5 Information and Communication Activities . . . . . . . . . . . . 164
5.4.6 Project Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
5.4.7 Rearranging Human Resources . . . . . . . . . . . . . . . . . . . . . 165
5.5 Discussion and Synthesis of Findings from the Theoretical
Sample . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166
5.5.1 Process Orchestration and the Role of Top Management . . . 167
5.5.2 Learning Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167
5.5.3 Challenges and Complexities . . . . . . . . . . . . . . . . . . . . . . . 169
5.5.4 Deployment Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . 169
5.5.5 The Nature of the Process . . . . . . . . . . . . . . . . . . . . . . . . . 170
Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171
6 Discussion and Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173
6.1 Synthesis of Findings and Theoretical Contributions . . . . . . . . . . . 173
6.1.1 What Is the Nature of the Process of Business Model
Innovation in Established Companies? . . . . . . . . . . . . . . . . 174
6.1.2 What Are the Challenges and Complexities Inherent to
Enacting this Process? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177
6.1.3 What Is the Nature of the Micro-Foundations, and Their
Managerial and Organisational Activities and Practices,
Underlying this Process? . . . . . . . . . . . . . . . . . . . . . . . . . . 178
6.1.4 What Is the Role of Top Management Within this
Process? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183
6.1.5 Conceptual Framework of the Micro-Foundations of
Business Model Innovation as a Dynamic Capability . . . . . 184
6.1.6 Summary of Theoretical Contributions . . . . . . . . . . . . . . . . 185
6.2 Managerial Implications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187
6.3 Limitations and Avenues for Future Research . . . . . . . . . . . . . . . . 189
6.4 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192

Appendices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
A. Interview Topic Guide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
B. Outcomes of Business Model Innovation . . . . . . . . . . . . . . . . . . . . . 196
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202
Abbreviations

BMI Business model innovation

CEO Chief executive officer
CFO Chief financial officer
CHF Swiss franc
COO Chief operating officer
DBA Doctor of Business Administration
e.g. exempli gratia (for example)
EBITDA Earnings before interest, tax, depreciation and amortisation
et al. et alia (and others)
etc. et cetera (and so on)
EUR Euro
HR Human resources
i.e. id est (that is)
ISO International Organization for Standardization
IT Information technology
MES Medical system
MOAPs Managerial and organisational activities and practices
MP3 MPEG Audio Layer III
n/a Not applicable
P&L Profit and loss statement
PMO Project management office
R&D Research and development
SWOT Strengths, weaknesses, opportunities, threats
USD United States dollar
VP Vice president

xiii
List of Figures

Fig. 1.1 Business model articles in the business/management field.

Source: Zott et al. (2011) . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . 2
Fig. 2.1 The strategy cube. Source: Own representation . . . . . . . . . . . . . . . . . . . . 31
Fig. 4.1 Crafting the business model: iterative learning—design—action
cycles during the evolution phase. Source: Own representation . . . 116
Fig. 4.2 Preliminary framework of the micro-foundations of business
model innovation as a dynamic capability . . . . . . . . . . . . . . . . . . . . . . . . . . 121
Fig. 5.1 Organisational Chart April 2009. Source: Company
documentation. Newly created clusters are highlighted in dark
blue . . . .. . . . .. . . . .. . . . .. . . . . .. . . . .. . . . .. . . . .. . . . . .. . . . .. . . . .. . . . .. . . . . .. . 129
Fig. 5.2 Organisational Chart 2008. Source: Company documentation . . . . 130
Fig. 5.3 Vision and mission. Source: Company documentation . . . . . . . . . . . . 133
Fig. 5.4 Process Map. Source: Company documentation. Top
blue ¼ management processes, middle ¼ core processes,
bottom green ¼ support processes . .. . . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . 135
Fig. 5.5 Slide from Workshop 2 outlining the Origins of the Focus
Topics 2009. Source: Company documentation. Yellow ¼
external studies, blue ¼ internal studies, orange ¼ literature,
dark green ¼ strategy and management workshop activities,
light green ¼ resulting focus topics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
Fig. 5.6 Slide from Workshop 4 outlining the Origins of the Focus
Topics 2011/2012. Source: Company documentation. Yellow ¼
external studies, blue ¼ internal studies, orange ¼ literature,
now including Watkins and Collins, top red ¼ overall vision,
bottom red ¼ key performance indicators and management
tools, light green ¼ resulting focus topics . . . . . . . . . . . . . . . . . . . . . . . . . . 143
Fig. 5.7 Slide from Workshop 7 outlining the Origins of the Focus
Topics 2012/2013. Source: Company documentation . . . . . . . . . . . . . 144

xv
xvi List of Figures

Fig. 5.8 The Hirslanden business model representation.

Source: Company documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
Fig. 5.9 Umbrella concept. Source: Company documentation . . . . . . . . . . . . . . 145
Fig. 5.10 Umbrella “Bauchmedizin”. Source: Company documentation . . . . 146
Fig. 5.11 The Hirslanden Value Formula. Source: Company
documentation . . . . . . . .. . . . . . . . . .. . . . . . . . .. . . . . . . . .. . . . . . . . .. . . . . . . . .. . . 146
Fig. 5.12 Organisation Chart 2009. Source: Company documentation . . . . . . 160
Fig. 5.13 Organisation Chart March 2011. Source: Company
documentation . . . . . . . .. . . . . . . . . .. . . . . . . . .. . . . . . . . .. . . . . . . . .. . . . . . . . .. . . 160
Fig. 5.14 Organisation Chart December 2011. Source: Company
documentation . . . . . . . .. . . . . . . . . .. . . . . . . . .. . . . . . . . .. . . . . . . . .. . . . . . . . .. . . 161
Fig. 5.15 Organisation Chart 2013. Source: Company documentation . . . . . . 162
Fig. 5.16 Organisation Chart 2014. Source: Company documentation . . . . . . 162
Fig. 6.1 Conceptual framework of the micro-foundations of business
model innovation as a dynamic capability. Source: Own
representation . . .. . . .. . . .. . .. . . .. . . .. . . .. . .. . . .. . . .. . . .. . . .. . .. . . .. . . .. . 185
Fig. 6.2 Business model innovation architecture . . . . . . .. . . . . .. . . . . . .. . . . . . .. . 189
List of Tables

Table 1.1 Book outline and purpose of chapters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Table 2.1 Publications sample statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Table 2.2 Data collection methodology .. . . .. . . . .. . . .. . . . .. . . .. . . . .. . . .. . . . .. . 21
Table 2.3 Inventory of statements on the business model construct . . . . . . . 23
Table 2.4 Business model component clusters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Table 2.5 Key features of four perspectives on the business model
phenomenon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Table 3.1 Overview of interviewees and their roles by research site . . . . . . . 51
Table 3.2 Overview of data collection and analysis stages . . . . . . . . . . . . . . . . . 61
Table 4.1 The Hirslanden business model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Table 4.2 The SevenVentures business model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Table 4.3 The Isovolta business model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Table 4.4 The Trumpf financial services business model . . . . . . . . . . . . . . . . . . . 73
Table 4.5 The Fahrenheit 212 business model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Table 4.6 Representative quotations for “Triggers” . . . . . . . . . . . . . . . . . . . . . . . . . 76
Table 4.7 Representative quotations for “Developing an initial idea” . . . . . 79
Table 4.8 Representative quotations for “Validating the initial idea” . . . . . . 83
Table 4.9 Evolution phase at Fahrenheit 212 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
Table 4.10 Evolution phase at ProSiebenSat.1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Table 4.11 Evolution phase at Trumpf financial services . .. . . .. . . . .. . . .. . . .. . 89
Table 4.12 Representative quotations for “Iterative Process” . . . . . . . . . . . . . . . . 90
Table 4.13 Representative quotations for “Having Success” . . . . . . . . . . . . . . . . . 92
Table 4.14 Representative quotations for “Encountering Challenges” . . . . . . 94
Table 4.15 Successes and challenges by case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Table 4.16 Representative quotations for “Designing the New Business
Model” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Table 4.17 Design content, activities and sources of inspiration by case . . . 103
Table 4.18 Representative quotations for “Implementation” . . . . . . . . . . . . . . . . . 105

xvii
xviii List of Tables

Table 4.19 Representative quotations for “Diffusion” . . . . . . . . . . . . . . . . . . . . . . . . 108

Table 4.20 Representative quotations for “Process Management” . . . . . . . . . . . 114
Table 5.1 Representative Quotations for “Process Orchestration
Mechanisms” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
Table 5.2 Strengths and Weaknesses 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133
Table 5.3 Overview of management workshops . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
Table 5.4 Representative quotations for “learning mechanisms” . . . . . . . . . . . 147
Table 5.5 Representative Quotations for “Deployment Mechanisms” . . . . . 150
Table 6.1 Design and implementation/operation challenges . . . . . . . . . . . . . . . . 178
Chapter 1
Introduction

1.1 Problem Statement

Get the business model wrong, and there is almost no chance of success. . . (Teece
2010, 191)

In 2001 Apple Inc. launched the first versions of its iPod music player and iTunes
music software, followed by the introduction of the iTunes Music store in 2003.
Apple was neither the inventor of portable MP3 music players, nor did it invent the
idea of downloadable music. Yet, Apple was the first company to invent a business
model exploiting these technologies in a way that created value for the customer,
itself and the music business ecosystem. Within 3 years the iPod + iTunes product
and service bundle had become a $10 billion offering, accounting for 50% of
Apple’s revenues, elevating its market capitalisation from $2.6 billion in 2002 to
$133 billion in 2007, a period considered the iPod + iTunes growth years (Amit and
Zott 2010; Johnson 2010), and turning Apple into a key player of the music industry,
reinventing music distribution and consumption.
In the light of examples like these, the fascination with business model innovation
is understandable. Yet, despite the progress that has been made in the last 20 years
developing the understanding of business models, little is known about how
established companies design and implement new business models.
A major gap in current understanding is the lack of empirical research on the
process of business model innovation within established companies (Chesbrough
and Rosenbloom 2002; Christensen et al. 2002; Demil and Lecocq 2010; Dottore
2009; Eyring et al. 2011; George and Bock 2011; Johnson et al. 2008; Klang et al.
2010; Leavy 2010; Pateli and Giaglis 2004).
Adopting a dynamic capabilities perspective, the objective of this study is to
contribute to filling this gap by exploring the processes, activities and practices
through which business model innovation arises in established companies.

© The Editor(s) (if applicable) and The Author(s), under exclusive licence to 1
Springer Nature Switzerland AG 2020
M. Sniukas, Business Model Innovation as a Dynamic Capability, Contributions to
Management Science, https://doi.org/10.1007/978-3-030-50100-6_1
References 13

Hamel, G. (1998a). The challenge today: Changing the rules of the game. Business Strategy Review,
9(2), 19–26.
Hamel, G. (1998b). Strategy innovation. Executive Excellence, 15(8), 7–8.
Hamel, G. (1998c). Strategy innovation and the quest for value. Sloan Management Review, 39(2),
7–14.
Hamel, G. (2000). Leading the revolution. Boston: Harvard Business School Press.
Hamel, G. (2001). Das revolutionäre Unternehmen: Wer Regeln bricht gewinnt. München: Econ.
Hamel, G. (2006). The why, what, and how of management innovation. Harvard Business Review,
84(2), 72–84.
Hamel, G., & Välikangas, L. (2003). The quest for resilience. Harvard Business Review, 81(9),
52–63.
Harreld, J. B., O Reilly, C. A., & Tushman, M. L. (2007). Dynamic capabilities at IBM: Driving
strategy into action. California Management Review, 49(4), 21–21.
Helfat, C. E., Finkelstein, S., Mitchell, W., Petraf, M. A., Singh, H., Teece, D. J., & Winter, S. G.
(2007). Dynamic capabilities: Understanding strategic change in organizations [Online].
Malden, MA: Blackwell. Amazon Kindle eBook. Accessed January 2011, from Amazon.com
IBM. (2006). Expanding the innovation horizon: The global CEO study 2006. IBM Global
Business Services.
Johnson, M. W. (2010). Seizing the white space: Business model innovation for growth and
renewal [Online]. Harvard Business School Press. Amazon Kindle eBook. Accessed December
2011 from Amazon.de
Johnson, M. W., Christensen, C. M., & Kagermann, H. (2008). Reinventing your business model.
Harvard Business Review, 86(12), 50–59.
Kim, W. C. & Mauborgne, R. (2005) Blue Ocean strategy: Harvard Business School Press, Boston.
Klang, D. J. H., Wallnöfer, M., & Hacklin, F. (2010). The anatomy of the business model: A
syntactial review and research agenda. Druid summer conference 2010. Imperial College
London Business School.
Koen, P. A., Bertels, H., Elsum, I. R., Orroth, M., & Tollett, B. L. (2010). Breakthrough innovation
dilemmas. Research Technology Management, 53(6), 48–51.
Lambert, S. (2006). A business model research schema. 19th Bled eConference eValues. Bled,
Slovenia.
Lawson, B., & Samson, D. (2001). Developing innovation capability in organisations: A dynamic
capabilities approach. International Journal of Innovation Management, 5(3), 377–400.
Leavy, B. (2010). A system for innovating business models for breakaway growth. Strategy &
Leadership, 38(6), 5–15.
Lindgardt, Z., Reeves, M., Stalk, G., & Deimler, M. S. (2009). Business model innovation: When
the game gets tough, change the game. Boston: The Boston Consulting Group.
Magretta, J. (2002). Why business models matter. Harvard Business Review, 80(5), 86–92.
Markides, C. (1996). Strategic innovation in established companies. Sloan Management Review.
Markides, C. (1997). Strategic innovation. Sloan Management Review, 38(3), 9–23.
Markides, C. (1998). Strategic innovation in established companies. Sloan Management Review, 39
(3), 31–42.
Markides, C. (1999). Six principles of breakthrough strategy. Business Strategy Review, 10(2),
1–10.
Markides, C. (2000). All the right moves – A guide to crafting breakthrough strategy. London:
Harvard Business School Press.
Markides, C. (2006). Disruptive innovation: In need of better theory. Journal of Product Innovation
Management, 23(1), 19–25.
Markides, C. (2008). Game changing strategies: How to create new market space in established
industries by breaking the rules. San Francisco: Jossey-Bass. A Wiley Imprint.
Markides, C., & Charitou, C. D. (2003). Responses to disruptive strategic innovation. MIT Sloan
Management Review, 44(2), 55–63.
Another random document with
no related content on Scribd:
 Table of the Twelve Houses.
Astrologers draw their table of the TWELVE HOUSES into a triple
quadrangle prepared for the purpose, of which there are four
principal angles, two of them falling equally upon the horizon, and
the other two upon the meridian, which angles are sudivided into 12
triangles for the 12 houses, in which they place the 12 signs of the
Zodiac, to each of which is attributed a particular quality,—viz.

1.— Aries, denoted by the sign ♈︎, is, in their extravagant opinion,
a masculine, diurnal, cardinal, equinoctial, easterly sign, hot
and dry,—the day house of Mars.
2.— Taurus, ♉︎, is a feminine, nocturnal, melancholy, bestial,
furious sign—cold and dry.
3.— Gemini, ♊︎, is a masculine sign, hot and moist, diurnal, aërial,
human, double-bodied, &c.
4.— Cancer, ♋︎, is a feminine, nocturnal, phlegmatic sign, by
nature cold and moist, the only house of Luna.
5.— Leo, ♌︎, is a sign, masculine, diurnal, bestial, choleric and
barren; a commanding, kingly sign—hot and dry, the only
house of the sun.
6.— Virgo, ♍︎, is a feminine, nocturnal, melancholy, and barren
sign.
7.— Libra, ♎︎, is a sign masculine, cardinal, equinoctial, diurnal,
sanguine and human, hot and moist.
8.— Scorpio, ♏︎, is a feminine, nocturnal, cold and phlegmatic
northern sign.
9.— Sagittarius, ♐︎, is a sign masculine, choleric, and diurnal, by
nature hot and dry.
 10. Capricorn, ♑︎, is a feminine, nocturnal, melancholy, solstitial,
— moveable, cardinal, and southern sign.
11.— Aquarius, ♒︎, is a masculine, diurnal, fixed, sanguine, and
human sign.
12. Pisces, ♓︎, is a feminine, nocturnal, phlegmatic, northerly
— double-bodied sign, the last of the twelve.
Having thus housed their signs and directed them in their
operations, they afterwards come to enquire of their tenants, what
planet and fixed stars they have for LODGERS, at the moment of the
nativity of such person; from whence they draw conclusions with
regard to the future incident of that person’s life. For if at the time of
that person’s nativity they find Mercury in 27° 52 min. of Aquarius,
and in the sextile aspect of the horoscope, they pretend to foretel that
that infant will be a person of great sagacity, genius, and
understanding; and therefore capable of learning the most sublime
sciences.
Astrologers have also imagined, for the same ridiculous purpose,
to be in the same houses different positions of the signs and planets,
and from their different aspects, opposition and conjunction, and
according to the rules and axioms they have prescribed to themselves
and invented, have the sacrilegious presumption to judge, in dernier
resort, of the fate of mankind, though their pretended art or science
is quite barren either of proofs or demonstrations.
 Signs to the Houses of the Planets.
The planets have allowed themselves each, except Sol and Luna,
two signs for their houses; to Saturn, Capricorn and Aquarius; to
Jupiter, Sagittarius and Pisces; to Mars, Aries and Scorpio; to Sol,
Leo; to Venus, Taurus and Libra; to Mercury, Gemini and Virgo;
and to Luna, Cancer.
 Angles or Aspects of the Planets.
By their continual mutations among the twelve signs, the planets
make several angles or aspects; the most remarkable of which are the
five following, viz.—
☌ Conjunction.—Δ Trine.—☐ Quadrate.—⚹ Sextile.—☍
Opposition.
A Conjunction is when two planets are in one and the same
degree and minute of a sign; and this, according to Astrological cant,
either good or bad, as the planets are either friends or enemies.
A Trine is when two planets are four signs, or 120 degrees distant,
as Mars in twelve degrees of Aries, and Sol in twelve degrees of
Leo. Here Sol and Mars are said to be in Trine Aspect. And this is
an aspect of perfect love and friendship.
A Quadrate Aspect is when two planets are three signs, or 90
degrees distant, as Mars in 10 degrees, and Venus in 10 degrees of
Leo. This particular aspect is of imperfect enmity, and Astrologers
say, that persons thereby signified, may have jars at sometime, but of
such a nature as may be perfectly reconciled.
A Sextile Aspect, is when two planets are two signs, or 60 degrees
distant, as Jupiter in 15 degrees of Aries; and Saturn in 15 degrees
of Gemini; here Jupiter is in a sextile aspect to Saturn. This is an
aspect of friendship.
An Opposition is, when two planets are diametrically opposite,
which happens when they are 6 signs, or 180 degrees (which is one
half of the circle) asunder; and this is an aspect of perfect hatred.
A Partile Aspect, is when two planets are in a perfect aspect to
the very same degree and minute.
Dexter Aspects, are those which are contrary to the succession of
signs; as a planet, for instance, in Aries, casts its sextile dexter to
Aquarius.
Sinister Aspect, is with the succession of signs, as a planet in
Aries, for example, casts its sextile sinister in Gemini.
In addition to these, Astrologers play a number of other diverting
tricks; hence we read of the Application—Prohibition—
Translation—Refrenation—Combustion—Exception—
Retrogradation, &c. of planets.
 The Application of Planets.
Application of the planets is performed by Astrologers in three
different ways.
1. When a light planet, direct and swift in its motion, applies to a
planet more ponderous and slow in motion; as Mercury in 8° of
Aries, and Jupiter in 12° of Gemini, and both direct; here Mercury
applies to a sextile of Jupiter, by direct application.
2. When they are both retrograde, as Mercury in 20° of Aries, and
Jupiter in 15° of Gemini; here Mercury, the lighter planet, applies to
the sextile aspect of Jupiter; and this is by retrogradation.
3. When one of the planets is direct, and the other retrograde; for
example, if Mercury were retrograde in 18° of Aries, and Jupiter
direct in 14° of Gemini; in this case Mercury applies to a sextile of
Jupiter, by a retrograde motion.
 Prohibition,
is when two planets are applying either by body or aspect; and
before they come to their partile aspect, another planet meets with
the aspect of the former and prohibits it.
 Separation,
is when two planets have been lately in conjunction, or aspect, and
are separated from it.
 Translation of Light and Virtue,
is when a lighter planet separates from the body or aspect of a
heavier one, and immediately applies to another superior planet, and
so translates the light and virtue of the first planet to that which it
applies to.
 Refrenation,
is when a planet is applied to the body or aspect of another; and,
before it comes to it, falls retrograde, and so refrains by its
retrograde motion.
 Combustion.
A planet is said to be combust of Sol, when it is within 8° 30″ of
his body, either before or after his conjunction: but Astrologers
complain, that a planet is more afflicted when it is applying to the
body of Sol, than when it is separating from combustion.
 Reception,
is when two planets are in each other’s dignities, and it may either
be by house, exultation, triplicity, or term.
 Retrogradation,
is when a planet moves backward from 20° to 9°, 8°, 7°, and so out
of Taurus into Aries.
 Frustration,
is when a swift planet applies to the body or aspect of a superior
planet; and before it comes to it, the superior planet meets with the
body or aspect of some other planet.
 The Dragon’s Head and Tail.
To the seven planets, viz. Saturn, Jupiter, Mars, Sol, Venus,
Mercury, and Luna; Astrologers add, two certain nodes or points,
called the Dragon’s head, distinguished by this sign ☋, and the
Dragon’s tail by ☊. In those two extremities of the beast, our students
in Astrology place such virtues, that they can draw from thence
wealth, honour, preferments, &c. enough to flatter the avarice,
ambition, vanity, &c. of the fools who follow them. Sensible,
however, that the admirers of this art support their principles and
defend their doctrines by examples founded on their own experience
and on the authority of history; there is no necessity for us here to
expose the weakness and futility of their arguments. Tully’s proof
will suffice; who, amidst the darkest clouds of superstition and
ignorance, and in the very heyday of paganism and idolatry, and
whilst religion itself seemed to countenance Astrology, inveighs
severely against it in Lib. 2, de devinat. “Quam multa ego Pompeis,
quam multa Crasso, quam multa huic ipsi Cæsari a Chaldæis dicta
memini, neminem eorum nisi senectute, nisi domi, nisi cum clantate
esse moriturum? ut mihi per Mirum videatur quem quam extare,
qui etiam nunc credastis, quorum predicta quotidie videat re et
eventis refelli[9].”
 Climacteric.
Astrologers have used their best artifices, and employed all the
rules of their art, to render those years of our age, which they call
climacterics, dangerous and formidable.
Climacterick from the Greek, κλιμακτης, which means by a scale or
ladder, is a critical year, or a period in a man’s age, wherein,
according to Astrological juggling, there is some notable alteration to
arise in the body; and a person stands in great danger of death. The
first climacterick, say they, is the seventh year of a man’s life; the rest
are multiples of the first, as 21, 49, 56, 63, and 84; which two last are
called the grand climactericks, and the danger more certain.
Marc Ficinus accounts for the foundation of this opinion: he tells
us there is a year assigned for each planet to rule over the body of a
man, each in his turn; now Saturn being the most maleficent
(malignant) planet of all, every seventh year, which falls to its lot,
becomes very dangerous; especially those of 63 and 84, when the
person is already advanced in years. According to this doctrine, some
hold every seventh year an established climacteric; but others only
allow the title to those produced by the multiplication of the
climacterical space by an odd number, 3, 5, 7, 9, &c. Others observe
every ninth year as a climacterick.
There is a work extant, though rather scarce, by Hevelius, under
the title of Annus Climactericus, wherein he describes the loss he
sustained by his observatory, &c. being burnt; which, it would
appear, happened in his grand climacterick. Suetonius says, that
Augustus congratulated his nephew upon his having passed his first
grand climacterick, of which he was very apprehensive.
Some pretend that the climacterick years are fatal to political
bodies, which perhaps may be granted, when they are proved to be so
to natural ones; for it must be obvious that the reason of such danger
can by no means be discovered, nor what relation it can have with
any of the numbers above-mentioned. Though this opinion has a
great deal of antiquity on its side; Aulus Gellius says, it was borrowed
from the Chaldeans, who, possibly, might receive it from Pythagoras,
whose philosophy turned much on numbers, and who imagined an
extraordinary virtue in the number 7.
The principal authors on the subject of climactericks, are Plato,
Cicero, Macrobius, Aulus Gellius, among the ancients; Argol,
Magirus, and Salmatius, among the moderns. St. Augustine, St.
Ambrose, Beda, and Bœtius, all countenance the opinion.
 Lucky and Unlucky Days.
Astrologers have also brought under their inspection and controul
the days of the year, which they have presumed to divide into lucky
and unlucky days; calling even the sacred scriptures, and the
common belief of Christians, in former ages, to their assistance for
this purpose. They pretend that the 14th day of the first month was a
blessed day among the Israelites, authorised therein, as they pretend,
by the several following passages out of Exodus, c. xii. v. 18, 40, 41,
42, 51. Leviticus, c. xxiii. v. 5. Numbers, c. xxviii. v. 16. “Four
hundred and thirty years being expired of their dwelling in Egypt,
even in the self same day departed they thence.”
With regard to evil days and times, Astrologers refer to Amos, c. 5,
v. 13, and c. vi. v. 3. Ecclesiasticus, c. ix. v. 12. Psalm, xxxvii. v. 19.
Obadiah, c. xii. Jeremiah, c. xlvi. v. 21, and to Job cursing his birth
day, chap. iii. v. 1 to 11. In confirmation of which they also quote a
calendar, extracted out of several ancient Roman catholic prayer
books, written on vellum, before printing was invented, in which
were inserted the unfortunate days of each month, as in the following
verses;—
January.—Prima dies mensis, et septima truncat ensis.
February.—Quarta subit mortem, prosternit tertia fortem.
March.—Primus mandentem, disrumpit quarta bibentem.
April.—Denus et undenus est mortis vulnere plenus.
May.—Tertius occidit, et Septimus ora relidit.
June.—Denus Pallescit, quindenus fædera nescit.
July.—Ter denus mactat, Julii denus labefactat.
August.—Prima necat fortem, perditque secunda cohortem.
September.—Tertia Septembris, et denus fert mala membris.
October.—Tertius et denus, est sicut mors alienus.
November.—Scorpius est quintus, et tertius est vita tinctus.
December.—Septimus exanguis, virosus denus ut Anguis.

This poetry is a specimen of the rusticity and ignorance at least of

the times; and is a convincing proof that Christianity had yet a very
strong tincture of the Pagan superstitions attached to it, and which
all the purity of the gospel itself, to this very day, has not been able
entirely to obliterate.
That the notion of lucky and unlucky days owes its origin to
paganism, may be proved from Roman history, where it is mentioned
that that very day four years, the civil wars were begun by Pompey
the father; Cæsar made an end of them with his son, Cneius
Pompeius being then slain; and that the Romans accounted the 13th
of February an unlucky day, because on that day they were
overthrown by the Gauls at Allia; and the Fabii attacking the city of
the Recii, were all slain with the exception of one man: from the
calendar of Ovid’s “Fastorum,” Aprilis erat mensis Græcis
auspicatissimus; and from Horace, lib. 2, ode 13, cursing the tree
that had nearly fallen upon it; ille nefasto posuit die.
The number of remarkable events that happened on some
particular days have been the principal means of confirming both
Pagans and Christians in their opinion on this subject. For example,
Alexander the Great, who was born on the 6th of April, conquered
Darius and died on the same day. The Emperor Bassianus Caracalla
was born and died on a sixth day of April. Augustus was adopted on
the 19th of August, began his Consulate, conquered the Triumviri,
and died the same day.
The Christians have observed that the 24th of February was four
times fortunate to Charles the Fifth. That Wednesday was a fortunate
day to Pope Sixtus V. for on a Wednesday he was born, on that day
made a Monk, on the same day made a General of his order, on that
day created a Cardinal, on that day elected Pope, and also on that day
inaugurated. That Thursday was a fatal day to Henry VIII. King of
England, and his posterity, for he died on a Thursday; King Edward
VI. on a Thursday; Queen Mary on a Thursday; and Queen Elizabeth
on a Thursday. The French have observed that the feast of Pentecost
had been lucky to Henry III. King of France, for on that day he was
born, on that day elected king of Poland, and on that day he
succeeded his brother Charles IX. on the throne of France.
 Genethliaci.
(From γενεθλη, origin, generation, nativity.)
These, so called in Astrology, are persons who erect Horoscopes;
or pretend what shall befal a man, by means of the stars which
presided at his nativity[10]. The ancients called them Chaldæi, and by
the general name mathematici: accordingly the several civil and
canon laws, which we find made against the mathematicians, only
respect the Genethliaci, or Astrologers; who were expelled Rome by a
formal decree of the senate, and yet found so much protection from
the credulity of the people, that they remained unmolested. Hence an
ancient author speaks of them as hominum genus, quod in civitate
nostra sempe et vetabitur, et retinebitur.
Genethliacum, (Genethliac poem,)

Is a composition in verse, on the birth of some prince, or other

illustrious person; in which the poet promises him great honours,
advantages, successes, victories, &c. by a kind of prophecy or
prediction. Such, for instance, is the eclogue of Virgil to Pollio,
beginning
Sicelides Musæ, paulo majora Canamus.

There are also Genethliac speeches or orations, made to celebrate a

person’s birth day.