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Business model evolution: in search of dynamic consistency
TL;DR: In this paper, the authors use the RCOV framework to consider business model evolution, looking particularly at the dynamic created by interactions between its business model's components, and illustrate the case of the English football club Arsenal FC over the last decade.
Abstract: The business model concept generally refers to the articulation between different areas of a firm's activity designed to produce a proposition of value to customers. Two different uses of the term can be noted. The first is the static approach - as a blueprint for the coherence between core business model components. The second refers to a more transformational approach, using the concept as a tool to address change and innovation in the organization, or in the model itself. We build on the RCOV framework - itself inspired by a Penrosian view of the firm – to try to reconcile these two approaches to consider business model evolution, looking particularly at the dynamic created by interactions between its business model's components. We illustrate our framework with the case of the English football club Arsenal FC over the last decade. We view business model evolution as a fine tuning process involving voluntary and emergent changes in and between permanently linked core components, and find that firm sustainability depends on anticipating and reacting to sequences of voluntary and emerging change, giving the label ‘dynamic consistency’ to this firm capability to build and sustain its performance while changing its business model.
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TL;DR: This article provided a broad and multifaceted review of the received literature on business models in which the authors examined the business model concept through multiple subject-matter lenses and found that scholars do not agree on what a business model is and that the literature is developing largely in silos according to the phenomena of interest of the respective researchers.
3,850 citations
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TL;DR: In this paper, the authors review the current literature on business models in the contexts of technological, organizational, and social sustainability innovations and propose examples of normative 'boundary conditions' that business models should meet in order to support sustainable innovations.
Abstract: The aim of this paper is to advance research on sustainable innovation by adopting a business model perspective. Through a confrontation of the literature on both topics we find that research on sustainable innovation has tended to neglect the way in which firms need to combine a value proposition, the organization of the upstream and downstream value chain, and a financial model, in order to bring sustainability innovations to the market. Therefore, we review the current literature on business models in the contexts of technological, organizational, and social sustainability innovations. As the current literature does not offer a general conceptual definition of sustainable business models, we propose examples of normative 'boundary conditions' that business models should meet in order to support sustainable innovations. Finally, we sketch the outline of a research agenda by formulating a number of guiding questions.
1,477 citations
TL;DR: In this paper, the emerging business model innovation literature addresses an importa-tation of business models to management research and among practitioners, and the emerging BMI literature addresses the importa...
1,201 citations
TL;DR: The authors argue that studying business models as models is rewarding in that it enables us to see how they embody multiple and mediating roles, and illustrate their ideas with reference to practices in real world and to academic analyses, especially in this Long Range Planning Special Issue on Business Models.
1,171 citations
TL;DR: In this article, the authors present a recently converging business model view, based on analyzing business model definitions, perspectives and components in the literature, and portray its essential components in an integrated framework.
903 citations
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TL;DR: In this paper, the authors draw on the social and behavioral sciences in an endeavor to specify the nature and microfoundations of the capabilities necessary to sustain superior enterprise performance in an open economy with rapid innovation and globally dispersed sources of invention, innovation, and manufacturing capability.
Abstract: This paper draws on the social and behavioral sciences in an endeavor to specify the nature and microfoundations of the capabilities necessary to sustain superior enterprise performance in an open economy with rapid innovation and globally dispersed sources of invention, innovation, and manufacturing capability. Dynamic capabilities enable business enterprises to create, deploy, and protect the intangible assets that support superior long- run business performance. The microfoundations of dynamic capabilities—the distinct skills, processes, procedures, organizational structures, decision rules, and disciplines—which undergird enterprise-level sensing, seizing, and reconfiguring capacities are difficult to develop and deploy. Enterprises with strong dynamic capabilities are intensely entrepreneurial. They not only adapt to business ecosystems, but also shape them through innovation and through collaboration with other enterprises, entities, and institutions. The framework advanced can help scholars understand the foundations of long-run enterprise success while helping managers delineate relevant strategic considerations and the priorities they must adopt to enhance enterprise performance and escape the zero profit tendency associated with operating in markets open to global competition. Copyright 2007 John Wiley & Sons, Ltd.
9,400 citations
Book•
01 Jan 1963
TL;DR: In this paper, the authors present an overview of basic concepts in the Behavioral Theory of the Firm, and present a specific price and output model for a specific type of products. But they do not discuss the relationship between the two concepts.
Abstract: List of Tables and Figures. Acknowledgements. Preface to Second Edition. 1. Introduction. 2. Antecedents of the Behavioral Theory of the Firm. 3. Organizational Goals. 4. Organizational Expectations. 5. Organizational Choice. 6. A Specific Price and Output Model. 7. A Summary of Basic Concepts in the Behavioral Theory of the Firm. 8. Some Implications. 9. An Epilogue. Index.
8,897 citations
TL;DR: The proposed theoretical framework deals with alternative ways in which organizations define their product-market domains (strategy) and construct mechanisms (structures and processes) to pursue these strategies.
7,506 citations
Journal Article•
5,594 citations
TL;DR: In this article, the authors explore the theoretical foundations of value creation in e-business by examining how 59 American and European e-Businesses that have recently become publicly traded corporations create value.
Abstract: We explore the theoretical foundations of value creation in e-business by examining how 59 American and European e-businesses that have recently become publicly traded corporations create value. We observe that in e-business new value can be created by the ways in which transactions are enabled. Grounded in the rich data obtained from case study analyses and in the received theory in entrepreneurship and strategic management, we develop a model of the sources of value creation. The model suggests that the value creation potential of e-businesses hinges on four interdependent dimensions, namely: efficiency, complementarities, lock-in, and novelty. Our findings suggest that no single entrepreneurship or strategic management theory can fully explain the value creation potential of e-business. Rather, an integration of the received theoretical perspectives on value creation is needed. To enable such an integration, we offer the business model construct as a unit of analysis for future research on value creation in e-business. A business model depicts the design of transaction content, structure, and governance so as to create value through the exploitation of business opportunities. We propose that a firm's business model is an important locus of innovation and a crucial source of value creation for the firm and its suppliers, partners, and customers. Copyright © 2001 John Wiley & Sons, Ltd.
5,082 citations