An examination of barriers to business model innovation

Abstract

Business models (BM) are the logic of a firm on how to create, deliver and capture value. Business model innovation (BMI) is essential to organisations for keeping competitive advantage. However, the existence of barriers to BMI can impact the success of a corporate strategic alignment. Previous research has examined the internal barriers to business model innovation, however there is a lack of research on the potential external barriers that could potentially inhibit business model innovation. Drawn from an in-depth case study in a German medium size engineering company in the equestrian sports industry, we explore both internal and external barriers to business model innovation. BMI is defined as any change in one or more of the nine building blocks of the Business Model Canvas; customer segment, value propositions, channels, customer relation, revenue streams, key resources, key activities, key partners, cost structure [1]. Our results show that barriers to business model innovation can be overcome by the deployment of organisational learning mechanisms and the development of an open network capability.