Implementing Business Model Innovation: Human and organisational perspectives

Abstract

Although business model innovation (BMI) can create a firm's competitive advantage and enhance its performance, many small and medium-sized enterprises (SMEs) fail to obtain the expected outcomes when innovating their business model. BMI leads to irreversible fundamental changes in key components of a company's business model, which means it entails a high level of risk, ambiguity and uncertainty. BMI can be seen as a double-edged sword, in that it can have very positive and negative consequences, and firms can experience substantial growth or go bankrupt, depending on whether or not the BMI is implemented correctly. Hence, knowing how and when to innovate a BM is a serious challenge for firm managers/owners. This study developed a model for implementing Business Model Innovation in SMEs focusing on “human and organisational” factors to improve performance. The model shed light upon our understanding of the managerial side of BM implementation by highlighting the role of managers and employees within organization as a key driver for any change in a BM. These findings provide guidelines to help company owners/managers implement informed decisions about the implementation of BMI based on their firm's strategies.