Christian Sandström

Business model innovation from an open systems perspective: structural challenges and managerial solutions

There is an emerging consensus that business models are systemic and transcend firm boundaries. Yet, existing research on Business Model Innovation (BMI) challenges focus almost exclusively on intra-firm factors such as capabilities, cognition and leadership. We explore challenges related to BMI by instead drawing on an open systems perspective on organisations. In particular, we argue that the systemic and boundary-spanning nature of business models imply that firms are forced to act under conditions of interdependence and restricted freedom, since they do not have executive control over their surrounding network. Consequently, we propose that suitable managerial solutions include the development of shared knowledge, appropriability regimes based on trust, network stability and the alignment of heterogeneous interests.

Idea management systems for a changing innovation landscape

Over the last few decades, the nature of innovation has changed from being primarily related to incremental product innovation towards more business model innovation, discontinuous innovation and open innovation. These changes impose new demands on the ideation phase of the innovation process and on idea management systems. This article explores what an idea management system that handles some of these different forms of innovation ideas may look like. The studied idea management system differs from previous typologies in that it is dual, i.e., aiming to generate, evaluate and select both continuous and discontinuous innovation ideas and employing different processes and criteria within the same system.

Exploring Factors Influencing Incumbents' Response to Disruptive Innovation

This paper explores how certain incumbent characteristics influence an established firms response to disruptive innovation. More specifically, it looks at the challenges a middle size, top segment company faced and how this affected its reaction to the disruptive threat. This is done by conducting an in-depth case study of Hasselblad, a manufacturer of professional cameras. It can be seen in this case study that Hasselblads limited resources and its niche strategy affected how it managed the transition from analogue to digital camera technology. These characteristics made it difficult to allow experimentation with digital imaging in the main business since the available resources were severely limited and this initially inferior technology could harm the brand image. Instead, Hasselblad pursued collaborations and eventually launched a hybrid camera, which was compatible both with film and digital backs but did not become the expected success. Being close to bankruptcy, the digital resources needed were acquired and the company eventually survived the disruption. In conclusion, this paper argues that the managerial challenges and solutions to the innovators dilemma depend upon the particular characteristics of incumbents and that this heterogeneity has not been sufficiently captured by previous literature. It also suggests that medium size, top segment firms can survive disruptive innovation through collaboration and acquisitions.

Investing in Localized Relationships with Universities: What are the Benefits for R&D Subsidiaries of Multinational Enterprises?

In spite of a long‐standing interest in the distribution of knowledge spillovers from university research, there is only limited theoretical understanding of if and when opportunities to interact with a research university constitute a significant force of attraction for globally mobile investment in R&D. Based on an empirical investigation of the benefits of interaction with universities, this paper proposes an analytical framework and four ideal types of strategy for localised collaboration between R&D subsidiaries and universities. This taxonomy, which largely transcends industry sectors, and the illustrative cases presented in this paper provide insights into the potential scope for localised university‐industry interaction from the perspective of multinational enterprises. By connecting the empirical results to the question whether these benefits are significant enough to enhance a regions attractiveness as a location for R&D, we are able to develop a better understanding of the alternative strategies for policymakers and university leaders interested in stimulating such linkages.

Value creation and appropriation in social media - the case of fashion bloggers in Sweden

This paper explores and explains the emergence of commercial blogging. Studying the contents of 18 of Swedens top fashion blogs, our findings suggest that bloggers create value by generating improved transaction efficiencies. Fashion bloggers have high credibility and thus facilitate the flow of consumer information and choice. The blogs present a combination of private and commercial content, thereby creating a customer intimacy that differentiates them from more traditional market channels. The value of these relationships is appropriated partly through advertisements and partly from other sources of revenue, such as the creation of brands and online stores. Bloggers have become powerful intermediaries who often have a better contact with end consumers than fashion firms. This paper therefore suggests that management of the blogosphere is an emerging source of competitive advantage for fashion firms.

Managing business model renewal

It is well-documented that firms often need to change their business model when introducing a new product, but more knowledge is needed regarding why they struggle when trying to do so. This paper explores the challenges related to renewing an established business model. Drawing upon a case study and industrial network theory, we argue that business models are difficult to change because they are based upon interdependence throughout a system of interrelated actors. Firms are interconnected with actors beyond its boundaries and thus, only a limited control can be imposed. Our findings also suggest that firms can change their business models by identifying critical actors and by aligning incentives throughout their network.

Symmetric Assumptions in the Theory of Disruptive Innovation: Theoretical and Managerial Implications

The literature on disruptive innovation has convincingly explained why many established firms encounter problems under conditions of discontinuous change. Incumbents fail to invest in new technologies that are not demanded by their existing customers. This argument is grounded in resource dependency theory and the associated assumption that existing customers control a firms internal resource allocation processes. While the problem of disruptive innovation has been convincingly explained, there is still a need for managerial solutions. We argue that a key reason why such solutions are lacking can be found in the asymmetric assumptions made in the original theory of disruptive innovation. Specifically, we identify two related forms of asymmetry. First, the focal (incumbent) firm is treated as a collection of heterogeneous actors with different preferences, incentives and competencies, whereas firms in the surrounding environment are treated as if they contained no such heterogeneity. Second, the theory of disruptive innovation describes incumbents as controlled by their environment, but has failed to recognize that the environment can also be influenced. In this paper we argue that a more symmetric theory of disruptive innovation – i.e. one that treats all similar entities in the same way – opens up for a range of interesting managerial solutions.

ANALYSING UBER IN SOCIAL MEDIA — DISRUPTIVE TECHNOLOGY OR INSTITUTIONAL DISRUPTION?

Extant literature suggests that market disruptions take place because of two main reasons: technological disruption or institutional change. In view of these two alternative explanations, this pape ...

DISRUPTION AND SOCIAL MEDIA — ENTRANT FIRMS AS INSTITUTIONAL ENTREPRENEURS

Technological change often leads to competitive turbulence in established industries. Little is known about how the introduction of social media affects incumbent and entrant firms. This paper explores the impact of social media on the fashion journalism industry. Our findings show that entrant fashion bloggers have toppled incumbent fashion journalists. Through a netnographic analysis of published blog content, we argue that entrants have become dominant by transforming the profession of fashion journalism and in doing so, they have acted as institutional entrepreneurs. We argue that entrants are less bound by established institutional practices and that their ability to redefine the dominant logic of an industry can explain why they have outperformed incumbents.

High-end disruptive technologies with an inferior performance

The literature on disruptive technologies has previously stated that those innovations often emerge in low-end segments or in new markets and as the performance improves it eventually displaces the old technology. This article aims to explain how and why a technology may prosper in high-end or mainstream markets despite its initially lower performance and does so through three in-depth case studies. The findings suggest that those technologies may compensate the inferior performance by simplifying and removing work for customers. For instance, digital imaging emerged in high-end segments since these customers were willing to trade-off the initially lower image quality in order to remove the usage of film. Based upon these results, the paper concludes that the literature on disruptive technologies needs to maintain a more nuanced view of value and how it is created and distributed inside the customers organisation.