Business Model Design as a ‘Patchwork Quilt’: The Role of Local Social Identity in Imitation Choices

Abstract

This paper focuses on business model innovation (BMI) of a peripheral organization as a response to environmental uncertainty triggered by an abrupt industry-level change. Using a case study of the Irish Rugby Football Union, an organization that successfully transformed its business model after a regulatory change, we empirically demonstrate the fact that BMI within peripheral organization is a stream of selective imitation of practices from multiple external role models. We examine the dual role of local social identity in BMI as a filter in role model choice and as a driver of value creation and value appropriation in the new business model. Bridging experimentation-driven and experimentation-driven approaches to BMI, we explore to what extent trial-and-error learning is possible in a peripheral, resource-constrained organization and seek to shed the light on the debate regarding the choice of role models in inter-organizational imitation. Our exploratory case study brings together qualitative data from 33 interviews and participant observation with the analysis of quantitative performance data.