Business models and business model innovation: Between wicked and paradigmatic problems

The Internet short video is booming in recently years, but its business model architecture and corresponding mechanism of value creation remain obscure. This study aims at answering the question of “how does the Internet short video business model realize value creation”.Specifically, based on the perspective of factors’ architecture and the theoretical foundation of network effects, and following the business model’s logic among the dimensions of value proposition, value creation and value capture, this study compares Douyin and Kuaishou to investigate the theoretical architecture of the Internet short video business model and analyzes its mechanism of value creation. The findings suggest that the Internet short video business model consists of four key factors, namely, content, flow, operation, and monetization. Content belongs to value proposition dimension, including media oriented content and social oriented content; flow and operation belong to value creation dimension, flow including public flow and private flow, and operation including centralized operation and decentralized operation; monetization belongs to value capture dimension, including deal-promoting monetization and emotion-tied monetization. According to the logic among the business model’s dimensions, these factors are integrated as three theoretical architectures, which are labelled as “content-dominant business model”, “socialization-dominant business model” and “two-wheel driving business model”. These three kinds of Internet short video business model are respectively supported by cross-side network effect, same-side network effect and two-side network effect in the mechanism of value creation. Furthermore, “two-wheel driving business model” reaches the organic combination between “content-dominant business model” and “socialization-dominant business model”, which is more crucial for Internet short video platforms to gain sustainable competitive advantages.Compared with the extant literature, this study makes three main contributions: First, it supplements the research on the Internet short video business model by depicting its key factors and theoretical architectures. Second, it enriches the research on the architecture drivers of business model value creation by adopting the paradigm of “factor-architecture-value”. Third, it strengthens the research on the mechanism of value creation for the platform business model under network effects by combining the concepts of strategy management and economics such as positioning, resource, capability and rent. Overall, this study not only opens the “black box” of value creation in the Internet short video business model, but also sheds light on the business model innovation of Internet short video both theoretically and practically.

This article investigates the microfoundations of business model innovation (BMI) by unveiling the main micro factors explaining macro variables that in turn influence innovation in value creation and capture mechanisms of firms’ business models (BMs). Specifically, through the analysis of two companies innovating their BMs in metaverse setting (i.e., Roblox and Meta), the article provides and discusses a model bridging macro variables and micro factors. Indeed, first the model illustrates macro variables influencing innovation in value creation (i.e., technological infrastructure and knowledge management) and in value capture (i.e., stakeholders readiness and stimulation of interest). Second, the model clarifies how each of these macro variables is explained by two types of microfoundations, as individual microfoundations, pertaining with skills and actions of individuals, and relational microfoundations, relative to relationships among individuals. Our findings contribute to both BMI and microfoundation literature, by assessing, on the one hand, the macro variables driving innovation in value creation and value capture, and, on the other hand, the micro factors explaining such innovation. Moreover, the article suggests managers how to intervene on specific micro factors to drive the macro-level outcome of BMI.

This paper investigates the phenomenon of business models innovation (BMI) empowered by digital technologies and activated as a response to Covid-19 crisis. In fact, during the crisis numerous digital redesigns of businesses occurred to pursue both continuity and competitive advantage. Among these, the food retail sector has undergone under the pressure of the crisis intense digital changes, which, however, have not yet been investigated under the theoretical lens of BMI. To fill this gap, the paper analyzes the digital actions taken during the pandemic crisis by two large food retailers, namely Walmart and Carrefour. Covering a wide temporal interval of the pandemic evolution and reviewing multiple geographical markets, the authors interpreted the grocer's digital responses to the crisis in terms of innovation in value creation and capture mechanisms. As a result, three phases of digital BMI have been reconstructed, each characterized by specific mechanisms of value creation and capture experienced by the two grocers during the pandemic. Leveraging these findings, the paper proposes a model capable of defining how digital BMI takes place in response to crises. Results broaden theoretical knowledge and practical suggestions on digital BMI in terms of enabling factors, actionable value mechanisms, and future business opportunities.

As an overarching concept a business model describes how a firm creates and captures value for itself, its customers, and its partners. Although research has highlighted the importance of value creation and capture of business models, it primarily focused on the value creation mechanisms and neglected aspects of value capturing: Until to date, little is known about how firms attempt to protect their business model innovations from competition, which depicts one aspect of value capturing. Drawing on a sample of 24 cases, we derive a business model protection framework, which provides insights about how business models relate to IP protection mechanisms for value capture. Our empirical study reveals that the choice of IP protection is contingent on the applied business model. While some business models are characterized by both a high degree of formal and informal protection, others primarily apply informal protection mechanisms to profit from business model innovation.

The role of artificial intelligence (AI) in achieving sustainability goals has garnered attention in academic literature. While AI has been argued to be crucial in addressing circularity challenges, organizations face challenges in configuring a business model. Designing new business calls for insights on how AI can be integrated into value creation and capture mechanisms. There is a lack of clarity on how organizations deploy AI as they transition to circular business model innovation. The purpose of the study is to explore how AI is integrated into organizational processes while adopting circular business models. We conducted online open‐ended interviews with 55 participants to explore the potential role of AI in enabling the adoption of circular business models. Our findings have implications for theory building relating to AI business model innovation and provide a novel avenue for further research on business model innovation literature. Building on a natural resource‐based view, the findings indicate that while implementing a circular business model is challenging, AI enables organizations to create, transfer, and capture value through resource efficiency and the reuse of resources. As AI technologies continue to evolve, organizations must develop adaptive capabilities to continually explore opportunities. AI enables organizations to reduce costs, develop novel value‐creation strategies, and capture opportunities, resulting in improved efficiency. Transitioning to a circular business model requires developing routines, and organizations must adapt existing systems to ensure these systems result in pollution prevention, product stewardship, and sustainable development. It is important for managers to develop organizational resources and capabilities that enable the development of AI capabilities.

The evolution of digital technologies has been expanding the business opportunities that firms can tap by leveraging such technologies. Business model innovation triggered by digital technologies allows firms to extend the scope of products and services they offer and create new markets. This trend is particularly relevant in the energy sector. However, little is known about how actually energy firms’ business models evolve because of the adoption of digital technologies. Therefore, this article aims at shedding light on the business model innovation process enabled by digital technologies in the energy sector. To this aim, eight Italian energy service companies that innovated their business model by adopting digital technologies are analyzed. The empirical analysis allows to spot an archetypal business models innovation process enabled by digital technologies in the energy sector. The study contributes to the literature on business model and business model innovation by highlighting how digital technologies may promote the evolution of business models and by spotting an archetypal business models innovation process that can be implemented accordingly. It also contributes to the emerging literature on digital transformation, by showing how digital technologies can be exploited by energy firms to improve their value creation, delivery, and appropriation mechanisms.

Aim: In the era of mobile internet, live marketing has become a new business model for network marketing, and is a product of the interactive integration of new technology and marketing activities in the new era.Method: Based on the business model theory, combining the value creation process, using live streaming platforms such as Taobao, Tiktok, Jingdong and Amazon as examples, and adopting a qualitative analysis method, the business model elements and innovation paths of live marketing are analyzed.Findings: The research found that: (1) The live marketing model has new integrated features and new values. The combination of technical system integration and marketing activities is a hotbed for live marketing;(2) Based on the anchors influence and audiences attractiveness as the classification criteria, live broadcast sellers can be divided into super sellers, famous sellers, ordinary sellers and low-level sellers. It is a new classification proposed for the first time, which provides important evaluation contributions for understanding and distinguishing the different categories of live broadcast sellers; (3) Based on the business model canvas, this article finds that the business model innovation of live marketing illustrates the nine elements logical relationship of the business model, value proposition is the key-hub linking other elements. The business model innovation of live marketing also follows the basic laws of value creation, that is, from value proposition to value creation to value transmission, and finally to value acquisition;(4) The business model innovation path of live marketing is also the path of value rebuilding, which increasing value is the essence of the sustainable development of business model innovation.Implications/Novel Contribution: Therefore, these new findings can help non-live broadcast marketers transform their marketing concepts and methods, and improve their sales capabilities. The analysis of the business model innovation and value creation of live marketing reveals the essence of live marketing, and the mechanism of value co-creation between sellers and customers, which this research also creatively proposes its innovation model and value creation process from the perspective of the relationship between business model and value creation. Finally, the article is not in-depth study of its relationship business model innovation and value creation from the perspective of explicit knowledge and tacit knowledge.

It is argued in most academic literature that Business Model (BM) is a general model for how any business runs or should be run, it is the "blueprint of the business". Conversely we argue that no business has just one BM, one model on which it runs all its business or intends to run its business. In other words the BM can be used for "as-is" and the "to-be" businesses. However our research, in contrast to the other BM frameworks, indicates that businesses have more BMs - both "as-is" and "to-be" BMs - the multi business model approach. This was already theoretically indicated by Markides and Charitou in 2004, and again in the Casadesus-Masanell and Ricart model of 2010, but sadly no one in the BM community has followed up on this since then. It could have made a breakthrough in our understanding of BMs, Business Model Innovation (BMI) and Strategic BMI. The Multi Business Model Innovation Approach addresses the concerns in the BM community and in BMI practice to just focus on the ideation and conceptualization of BMs. "BM canvassing", innovating BM building blocks or BM dimensions when carrying out BMI, so-called "blind business model innovation", is not sufficient to run and understand a business today. BMs and BMI must address all the different levels in a business. All BMs are objects to BMI and should be used to maximize the performance and sustainability of the business. The core business and all levels BMs, such as BM dimension components, BM dimensions, BM portfolio, and Business Model Ecosystem (BMES), should all be considered for BMI. The book addresses and documents a gap in BM research and the BM community - but also proposes a generic definition and language of a BM and BMI layers. The significance and importance of this work is related to significant and unexplored possibilities that BMI offers today, and can offer tomorrow. When we thoroughly understand all levels, dimensions and components of the business and its business models, and we are able to communicate, work and innovate with business models at all levels together, then a next step in BM and BMI research and practice can be taken. It is proposed that any BMs are related to seven dimensions- value proposition, user and/or customer, value chain functions (internal), competence, network, relations and value formulae. It is further proposed that seven different levels of a BMI from the most detailed level - the BM dimension component - to the BM dimension, BM, BM portfolio, business, and the vertical and horizontal business model ecosystem layer - and these can be objects to BMI. Conceptually, the Business Model Cube was formed using the seven dimensions which could be used both in a 2D and a 3D version.

Purpose This study examines how different dimensions of environmental turbulence (technological, market and competitive) influence business model innovation (BMI) in emerging economies and how digital transformation (DT) moderates these relationships. Anchored in contingency theory and informed by the concept of reverse agency, the study explores how DT enables firms to shift from reactive to proactive strategic responses under turbulence. It analyses the impact of DT on value creation, proposition and capture mechanisms and their implications for firm performance. The research contributes to understanding how digitally enabled firms in volatile contexts reconfigure innovation pathways to improve adaptive capacity. Design/methodology/approach Based on data from 271 Colombian firms, a partial least squares structural equation model was developed to assess how turbulence – comprising technological, competitive and market turbulence – affects the three dimensions of BMI (value creation, value proposition and value capture) and firm performance. A multigroup analysis compared the responses of exporting and non-exporting firms. Findings We found that digital transformation significantly moderates the relationship between environmental turbulence and BMI, and BMI positively influences performance. Exporters and non-exporters differ in their adaptive strategies: exporters use digital transformation to enhance value creation and performance, while non-exporters emphasise internal value capture mechanisms. Practical implications The study introduces the managerial action model for business innovation (MAMBI) framework – a five-step, evidence-based guide to help firms align digital transformation and business model innovation with environmental turbulence. It offers actionable tools and KPIs, particularly valuable for SMEs in emerging markets aiming to enhance strategic adaptability and performance. Originality/value This is among the first studies to disaggregate both ET and BMI while modelling DT as a moderating variable. By integrating contingency theory and agency reversal, the study provides a novel framework for understanding digital adaptation in turbulent environments. The multigroup analysis offers new insights into how internationalisation conditions shape adaptive strategies, extending the contingency theory literature on digital transformation.

In recent times, continuous evolutions in digital technologies are triggering new business models (BMs) within virtual environments. This phenomenon is defining a new economy staging in so-called metaverses. Here, physical-world BMs are modified, virtual-world BMs are implemented, and combinations of physical-world and virtual-world BMs are performed. As a result, new mechanisms of value creation and value capture at the crossroads of physical and virtual economies arise in the metaverse. This paper aims at understanding which are these value mechanisms and how organizations can develop them. To this aim, the paper analyzes the cases of four cross-industry incumbents (namely, Gucci, Samsung, Hyundai, and Nike), which are pivoting their BMs in the metaverse. A framework indicating how to innovate BMs in the metaverse is provided, by looking at both “phygital” transformations (i.e., transformations aimed at joining physical and digital worlds’ realities) and completely virtual immersions shaping firms’ internal processes and relationships with customers. In this way, the paper supports companies in turning the metaverse into value, while also extends the scant academic knowledge on the metaverse’ impact on innovation of BMs.

The understanding of a business model has been contained by the necessity to comprehend new ways of commercializing innovation. i.e. to define the architecture of the value creation, delivery, and capture mechanisms. Since the beekeeping sector in Tanzania remained non-commercial, this study analyzes how commercial beekeeping can be achieved through the business model innovation. Using a qualitative literature review, content analysis approach, a commercial beekeeping business model is suggested. The study provides a theoretical building block for innovative business model in the beekeeping sector. It also addresses the gap about the use of the business model in beekeeping sector.

Despite recent research clarifying some of its core constructs, business model innovation (BMI) literature still lacks conceptual consistency, particularly regarding the architecture that ar ticulates the mechanisms of value creation, delivery, and capture at the individual, organizational, value network, and societal levels of analysis. In response to recent research calling for the identification of BMI rationales, we draw on a systematic literature review to unravel how the rationales underlying the strategic choice to adopt BMIs shape and align the multilevel mechanisms that result in distinct coherent BMI architectures. Our contributions are twofold: first, we provide scholars with further conceptual consistency for BMI as well as new research avenues by identifying three main BMI architectures: (1) rational sympathy-based, (2) rational commitment-based, and (3) rational egoism-based. Second, this research provides a diagnostic and guiding tool to help managers select and align mechanisms within a cohesive BMI architecture to generate more sustainable value at various levels.

A decade ago, Mobility as a Service (MaaS) has emerged as a revolutionary concept destined to change the traditional transport paradigm. Indeed, MaaS envisions an integrated and on-demand transportation ecosystem where users have access to a variety of mobility options via a unified digital platform that centralizes information, ticketing, and payment systems for different service providers. Recognizing its disruptive potential, in this paper we examinate the effects of MaaS introduction in the market, with a particular focus on businesses within the industry. Specifically, we aim at investigating the dynamic nature of business model innovation within the MaaS business ecosystem, thus capturing the changes, adaptations, and innovations that organizations have undergone, providing valuable insights into the new value creation, capture and delivery mechanisms that have emerged. To achieve these goals, we have employed an inductive, multiple case study approach, focusing on a total of six renowned organizations representing two key actor categories within MaaS ecosystems: service providers and technology providers. Our findings reveal that, despite their heterogeneity, both service and technology providers have adopted similar strategies in their transition to MaaS. Utilizing the value creation, capture, and delivery framework, we developed distinct models for each of these categories. We have identified common firm-specific mechanisms which have been categorized into broader macro-level mechanisms of value creation, capture, and delivery, drawing from existing literature. The findings of this study contribute to the ongoing academic literature related to MaaS and to business model innovation. Furthermore, they offer valuable practical insights for managers and policymakers, providing a guidance for strategic decision-making aimed at fostering the development and sustainability of innovative MaaS systems.

Altering and enhancing existing business models through business model innovation has emerged as a powerful competitive strategy that can provide advantage over extended periods of time. Business model innovation also presents a fundamental counterpart for technological, product and organisational innovations. Success stories of unconventional firms disrupting markets and sustaining financial rewards over competitors through business model innovation can be found in virtually any industry. A key success factor for long-term competitiveness lies in the implementation of multiple, rather than punctual, business model innovations over time, although achieving change through successive iterations is a challenge driven by market and technological dynamics and disruption. However, the lack of empirical investigation on the dynamics of business model change over extended periods of time limits our understanding of how established firms can mimic successful innovators and reconfigure their business models over time. This thesis responds to this gap by exploring the dynamic mechanisms enabling business model development in successful, high-performing firms. It defines and examines the distinctive properties of business model development to understand what determines success in extended business model change processes. The theoretical model and research design were developed to empirically investigate the sequences of change events in business models to find patterns characterising business model development in high-performing firms. The theoretical framework deconstructs the structure of a business model using three well-accepted dimensions of value: value creation, value delivery and value capture. It treats the business model as a dynamic open system in which a firm’s dynamic equilibrium behaviour and complementarity mechanisms are the drivers of change. Then, it employs principles from organisational theory, strategic management, innovation and entrepreneurship to explore the developmental trajectories of business models by examining: (a) the agents and nature of the actions driving business model changes; (b) the frequency of business model change events; (c) the magnitude of business model change events; and (d) the order of business model change events. The exploratory, longitudinal and quantitative research design supporting this study is process- based, where business model development is formulated as a sequence of change events unfolding over time. A set of 12 financial ratios are used to examine fluctuations in a firm’s operational, economic and product-market domains that are attributable to business model transformations for a sample of 1,651 listed firms in the IT sector worldwide. This sector was selected as the research setting because of its dynamism, global size and the pervasiveness of the technologies underpinning it. Business model change events are identified through outlier detection and analysis of coordinated changes across the value creation, delivery and capture dimensions of the business models. Data were collected from a large financial database and transformed into individual sequences of change events. A validation procedure assessed the accuracy of the identification process for business model change events through qualitative data and in-depth analysis for four firms in the larger sample. Then, the individual sequences of change events were used as inputs for data mining methods of analyses, complemented by frequency domain analysis and statistical tests, which revealed the patterns of business model development in high-performing firms. The results suggest a significant association between the timing and intensity at which firms change their business models and their average performance over time. The evidence also suggests that business model change is likely to culminate in events where the value delivery dimension is altered. In terms of the frequency and magnitude of changes, high-performing firms are more likely to develop their business models through frequent and incremental alterations over time, except for mature-large firms who, compared to young-small, young-large and mature-small firms, are more likely to implement radical, less frequent changes over time. Both environmental and internal forces influence the intensity at which high-performing firms typically alter their business models, although environmental factors are more significant than internal forces. Both unconscious and deliberated actions influence business model development in high-performing firms. Unconscious actions dictated by the firm’s particular characteristics of age, size and sub-industry membership are a more significant influence than deliberated, emergent actions. This research develops the new concept of business model development, and provides a contribution to theory by empirically examining a previously unexplored process. By adopting the process-based approach, this research contributes to new thinking and research in business model innovation centred on analysing the flow of events and patterns of business model development across multiple cases. Methodologically, this research developed a research design appropriate for large samples of firms, able to analyse multiple developmental trajectories of business models in a systematic and consistent manner. The research can assist practitioners and firms’ leaders adjust established business models by providing guidance on the intensity, order and frequency of the changes required.

Conceptualizing business model piloting: An experiential learning process for autonomous solutions