Incumbents and the implementation of scalable business model innovations

Purpose and goal

The first phase dealt with an initial problem formulation and development for the involved firms via customer development, case studies and interviews, and the identification of other interested firms. This work has been completed verifying the basic assumptions of the project and confirmed the opportunity for further work. Specifically, a new business unit (Skanska) was enrolled as well as a new firm (Gemalto).

Results and expected effects

1)Interviews/case studies indicate that firms systematically commit major mistakes when creating new businesses (business models). 2)A customer development project suggested the method works for incumbents but it needs to be modified. (Expectations of) organizational inertia may kill new businesses for incumbents unless such hurdles are considered during the customer development work´s early phases 3) Despite a general awareness of the effect of the business ecosystem on the business model´s viability, there are not any processes or attempts to analyze and affect them.

Approach and implementation

23 interviews and partly retrospective case studies created a frame of reference and a draft of a modified method for Phase 2. A customer development project was done (SCA) and one master´s thesis. The eco-systems effect was shown to be of major importance for the business model innovations´ viability. Interviews show firms lack processes and cognitive approaches to address these issues. There is an widespread awareness of these issues but these are not acted upon.