Abstract
AbstractThe rise of AI technologies is generating novel opportunities for companies to create additional value for their customers by applying a proactive approach, managing uncertainty, and thus improving cost efficiency and increasing revenue. However, AI technology capabilities are not enough—companies need to understand how the technology can be commercialized through appropriate AI business model innovation. When emerging technologies are introduced, business-model concepts often need to be significantly altered. This is necessary to fully capitalize on disruptive technologies because it is just as important to innovate the business model as it is to build advanced technology solutions. Therefore, the purpose of this study is to explain how AI providers align value-creation and value-capture dimensions in order to develop commercially viable AI business models. To fulfill our stated purpose, this study has adopted an inductive and exploratory single case-study approach centered on a market-leading provider of AI-related services. The findings are consolidated into a process framework that explicitly illustrates the key activities that companies need to perform concerning value creation and value capture for AI business model innovation and commercialization. The framework explains that AI providers need to follow three phases—namely, identifying prerequisites for AI value creation, matching value capture mechanisms, and developing AI business model offer. We also find that AI providers need to test and develop multiple AI business models and operate them simultaneously to ensure commercial success.
Highlights
Artificial intelligence (AI) is often referred to as a technology that facilitates the creation of additional value for customers
The case company we selected provided AI solutions to their customers, which meant that it possessed a proper understanding of AI itself as well as the potential that the technology held for application to different areas
The third theme covers the development of AI business model offers and the means through which value is to be captured
Summary
Artificial intelligence (AI) is often referred to as a technology that facilitates the creation of additional value for customers This stems from the advances in AI techniques that allow us to mimic cognitive behavior and automate the processes of identifying and solving complex problems (Lee et al 2019; Zhuang et al 2017). Brock and Von Wangenheim (2019) stress that the successful integration of AI applications is difficult to achieve because, in order to develop certain capabilities and resources, major investments and long development cycles are required. This will strengthen the opportunities for AI providers to become specialists in the subject and offer AI solutions to the industry. From a practical point view, this finds support in the Artificial Intelligence Global Executive Study and Research Report by Ransbotham et al (2019) where it is shown that 40% of their respondents conceded that significant investment did not deliver the sought-after business gains
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