Business model innovation: a typology

Purpose of the paper: The aim of the paper is to provide a typology of business model innovation (BMI) and to clarify its link with strategy. In particular, it focuses on the servitization strategy and shows multiple business model configurations that entrepreneurs may choose from when changing their strategy. Methodology: After a literature review conducted through ISI Web of Science database on 14 ABS grade four and grade three leading journals, published between 2000 and 2014, a new theoretical framework is presented. Baden-Fuller’s and Haefliger’s (2013) business model (BM) dimensions were selected in order to build the theoretical framework and Neeley’s (2008) identified servitization strategies were used in order to clarify the link between business model innovation and strategy. Findings: The literature reviewed shows that extant research has mainly focused on the capabilities and processes behind BMI, but has not provided a typology for BMI. The typology proposed consists of 16 business model configurations that may serve for both academics and practitioners in configuring a business model following a change in the firm’s strategy. Considering the servitization strategy, it is suggested that different servitization strategies require from entrepreneurs to choose between alternative business model configurations. Research limitations: The literature reviewed is limited to top international journals and the paper provides only ad hoc created examples in order to show how different servitization strategies require alternative business model configurations. Research and managerial implications: The theoretical framework proposed might be used as a means of analysing alternative business model configurations by entrepreneurs, and as a means of comparing alternative business model configurations by academics. Originality of the paper: The paper complements existing literature reviews on business model, focusing on BMI. Moreover, it provides a first attempt to link the servitization concept to the business model theme, hence contributing to bridging marketing and strategic management literatures