business model innovation design we're on a road to nowhere // on a quest to analyze and explore the design of business model innovations, i.e. 'hideous and hidden things' like organizational structures and capabilities, corporate strategies and all things related // on a yellow brick road with a girl, a lion and a straw-man wasting our time // …

Executive Summary:

When and why should an entrant adopt a new business model when the innovation could be imitated by an incumbent? In this paper, HBS professor Ramon Casadesus-Masanell and University of Southern California professor Feng Zhu examine the desirability, or lack thereof, of business model innovations when they cannot be protected, opening the door to competitive imitation. Issues of competing through new business model design become more important given the increasing number of opportunities for business model configurations enabled by technological progress, new customer preferences, and deregulation. Key concepts include:

• New entrants in a wide array of industries (such as Ryanair in the airline industry and IKEA in furniture) demonstrate that innovative business models can provide the basis for sustainable business success, even in industries with strong and well-established incumbents.
• Firms should take into account the likely competitive effects and responses before revealing a business model innovation.
• Just as product and process innovations are hard to protect, business model innovations can be imitated.
• For many years to come, firms in all kinds of industries will continue to surprise with unprecedented new ways of capturing value through sponsor-based business model innovation.

#earmarking this for the moment, tagged with innovation dynamics and strategy …