The Complexity of Business Model Innovation: A Case Study of a Circulating Idea Translating Into a Business Model

Abstract

The concept of business model innovation has become more important than ever before, both for practitioners and researchers. Business model innovation can be done in several ways, and one way is to adapt ideas circulating in the society. This paper, therefore, investigates how companies make use of circulating ideas into new business models. Previous research has neglected the process perspective of business model innovation, this study fills that void by applying the translation model together with the approach of exploitation and exploration. This study is a qualitative single-case study, including both interviews and document analysis. Firstly, this study proposes that companies are keen on adopting circulating ideas to get legitimacy. Then the study indicates that there is a complexity involved in business model innovation, mostly because of tensions appearing when both exploiting and exploring. The dominating factor of exploitation or exploration is framing how circulating ideas are allowed to be translated into business models, therefore we argue that tensions create a framework for translation. The frames constrain the path and permeate all translations that are made. The study suggests that companies need to be aware of the tensions to manage them and hence, get more opportunities when translating. Consequently, this paper inspires a greater discussion regarding the impact that tensions from exploiting and exploring have on the process of translating ideas into business models.