A business model perspective to understand intra-firm transitions: From traditional to flexible public transport services

Abstract

Socio technological transition with respect to innovations is a broader concept and generally is theorized as such. It is, therefore, unclear how at the micro level, the business firms within an industry is restructuring internally to accommodate the technological innovations. Insights of this process management is uniquely valuable to understand how local technological niches and larger socio-technological transformations are being accommodated in industrial reforms. A business model perspective could provide insights of these innovation process management, in this context the mobility transition from fixed to flexible public transport (FPT) systems. Taking business models as the unit of analysis, in this paper we provide a framework to map the transition process. The framework is applied to a case study of a traditional public transport firm in the Netherlands. We map the evolution of the business models taking the local external developments into account. We define three phases for the business model mapping here – pre FPT, during FPT and the future of FPT. Findings suggest a complete shift in client orientation of public transport authorities with geared up efforts in digitalization and value creation during these three phases of FPT transition. Perhaps the most striking - yet not completely unexpected – outcome for transit companies is to gradually assume a role of facilitator as opposed to a provider of public transit, which potentially will have a thorough reform of the industry. This initial trace of internal transition, however incomplete, provides useful insights of the overall product and process management and the emerging business model configurations and contributes to the learning trajectory of FPT service organizations.