Organizational capabilities and process of business model innovation for digital offers

Abstract

Recent digital technologies, IoT and cloud computing are pushing established manufacturing firms to develop digital services, which require them to go through a complete Business Model Innovation (BMI). Despite this growing trend, strategy literature still lacks a complete picture of how established firms develop new business models and which organisational capabilities would facilitate this process. This paper addresses these literature gaps through studying the process of developing digital services in two manufacturing firms. We identified four phases for the BMI process and nine organisational capabilities that facilitate this process. Our findings contribute to the literature on digital transformation, business model innovation and dynamic capabilities.