Capturing Dynamics in Business Model Frameworks

Abstract

Business model dynamics is important, because high-tech companies, the technology that they commercialize, and the market in which they operate all change over time. We build on the dynamic capability view of the firm to explain business model evolution and innovation, looking particularly at the dynamics that are created by interactions between business model components over time. We use the following four criteria to assess the degree of dynamics in business model frameworks: completeness of business model aspects, interrelationships between aspects, interrelationships over time, and framework changes over time and across contexts. Business model completeness involves internal company aspects and external environmental aspects. Interrelationships of business model aspects are required to assess business model coherence, which is an important indicator of business model quality. Interrelationships between the environment and business model aspects are required to assess the fit of a particular business model in its context. Interrelationships of these aspects over time are needed to understand business model evolution. Finally, business model frameworks need to be adapted over time and across contexts to keep frameworks simple and useful yet complete. Our analysis shows that current business model frameworks do not meet all four criteria, and thus only partly incorporate dynamics.

Paternalistic Leadership and Innovative Behavior: Psychological Empowerment as a Mediator

“…Consequently, companies have to engage actively in innovation to survive in a competitive market. Companies' success in innovation does not only depend on closed innovation but also on open innovation [41]. Thus, the importance of open innovation is widely discussed in previous research [42,43].…”

“…Further, to enhance moral climate, organizations should arrange training and educational programs [7] and encourage moral behaviors and values. Furthermore, with moral leadership organizations can also foster open innovation, which plays a critical role in servitization [94], and product innovation [41][42][43].…”

The Platform Canvas—Conceptualization of a Design Framework for Multi-Sided Platform Businesses

“…In its attempt to serve as a tool for the evaluation and design of new ventures, the Business Model Canvas has been criticized for its lack of information about the venture's external context, including existing competition in the market in which the business hopes to operate (Ching & Fauvel, 2013;Khodaei & Ortt, 2019;Kraaijenbrink, 2018). Moreover, the Business Model Canvas represents the elements of a traditional business that constructs and delivers its own products or services to customers in a linear, unidirectional flow.…”

“…The Business Model Canvas neglects any mention of typical competitive features within the venture's industry, such as the threat of substitutes or new entrants (Porter, 1998). A number of authors lament the paucity of rigorous explanation about interrelationships between the components in the framework (Ching & Fauvel, 2013;Fritscher & Pigneur, 2014;Joyce & Paquin, 2016;Khodaei & Ortt, 2019). This omission might be traced to the core definition of a business model, which refers to the creation, delivery and capture of value.…”

“…By identifying the connections and interdependencies within a platform business model, the Platform Canvas also helps the entrepreneur expand their perspective from a static snapshot of the venture at a single point in time to a dynamic perspective that captures the drivers of venture evolution over time. This aspect of the Platform Canvas can foster venture innovation (Khodaei & Ortt, 2019). Furthermore, the interrelations of the elements can be of great use to teachers using the Platform Canvas to assist students in understanding the platform business model.…”