Internet of Things Business Model Innovation and the Stage-Gate Process: An Exploratory Analysis

Abstract

Large manufacturing companies will in future be continuously challenged to develop and implement new IoT-related business models. Existing research offers interesting insights on high-level stages of business model innovation (BMI) processes in general. However, only little is known about the presence of main gates in BMI processes and even less about the underlying decision criteria applied at these gates. To shed more light on this research field, 27 expert interviews with employees from eight companies across the IoT ecosystem were conducted. The expert interviews reveal that, despite the increasing popularity of (radically) new innovation approaches, two main decision points can be identified across BMI processes. These findings are a first explorative step towards a better understanding of IoT adoption and provide a starting point for interesting future research avenues.

Business model innovation: a review of the process-based literature

“…Concerning the theoretical approaches, most of the articles rely on the BM literature or BM theory, which links them to various and multiple perspectives, such as value-based perspectives (e.g., Landau et al, 2016 ), system perspectives (Inigo et al, 2017 ), or evolutionary perspectives (e.g., Amit & Zott, 2012 ), among others (e.g., Tesch et al, 2017 ). Some articles associate BMI with organizational resources and apply resource-based and dynamic capabilities views (e.g., Schindehutte et al, 2008 ).…”

“…This process concludes with a detailed map of the activity system needed to achieve the core firm’s objectives (Bucherer et al, 2012 ; Chatterjee, 2013 ; Euchner & Ganguly, 2014 ). The creation of new business models from scratch is mostly related to the introduction and exploitation of new technologies (Amshoff et al, 2015 ), such as Internet of Things technologies (García-Gutiérrez & Martínez-Borreguero, 2016 ; Tesch et al, 2017 ) and digitization (Jensen & Sund, 2017 ; Vasarhelyi & Alles, 2008 ). However, the decision to use a BMI design from scratch is often determined by market-driven disruptive approaches to the market (Habtay, 2012 ).…”

The relationship between the Internet of Things and knowledge management in smart ecosystem development

“…This is primarily because there is no formalization or fixed context in the IoT ecosystems, with new actors entering or leaving at any given time, generating a business and technological environment that is highly dynamic. Thus, it is vital to identify the key stakeholders, understand their requirements and contributions to IoT co‐creation, and discover viable business models (Ikävalko, Turkama, & Smedlund, 2018; Metso & Kans, 2017; Tesch, Brillinger, & Bilgeri, 2017).…”

Business model innovation canvas: a visual business model innovation model

“…The above research shows that there is an academic consensus in the field of business model innovation research on value driven, value creation and value transmission. Tesch and Brillinger (2019) discussed the evaluation aspect of digital business model innovation. van der Raadt et al (2005) studied the innovation of Web service business model in digital music industry from the perspective of business value, and evaluated the value of business model by e 3 -value simulation method.…”

“…van der Raadt et al (2005) studied the innovation of Web service business model in digital music industry from the perspective of business value, and evaluated the value of business model by e 3 -value simulation method. Tesch (2019) took scenario planning as a causal evaluation tool for Internet of things business model innovation. The above research has actively explored the value evaluation of business model innovation, which shows that the value evaluation of business model innovation has been paid attention to in the academic field.…”