Transforming SNCF’s business model through the evolution of participative innovation routine

Abstract

Purpose Many barriers prevent firms from changing their business models. Inertia, as it accumulates over time, transforms into organizational routines that doom change; however, it can also be a source of organizational flexibility. How does a business model evolve in interaction with organizational routines? This paper aims to study the interactions between forms of participative innovation (PI) and existing business models. Design/methodology/approach The exploratory approach includes interviews, participant and non-participant observations and archive analysis. It adapts an existing framework, based on the notion of scripts, to the evolutionary dynamic of organizational routines at the French railway company SNCF. The analysis of a set of contextual elements clarifies events over time and interactions between PI and the company’s business model. Findings The empirical insights indicate how existing routines can help reinvent business models. Business model components evolve along the transformation phases of PI. The case reveals co-evolutionary dynamics: evolution of the organizational routine from bureaucratic suggestion, to structured innovation, to PI leads to the transformation of the business model from functionalist, to customer-centric, to open business model. Practical implications Firm managers can think more proactively about how to reinvent established business models by innovating their existing routines, according to the position and role of routines, shifting from sources of rigidity and inertia to levers for innovation and change. Originality/value The business model concept serves as a prism of analysis for organizational routines. Organizational routines are sources of flexibility, strategic renewal and business model reinvention.