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2013/2014  KAN-CCMVV1699U  Innovating Business Models

English Title
Innovating Business Models

Course information
Language English
Exam ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Semester
Course period Spring
Changes in course schedule may occur
Friday 11.40-14.15, week 6-16, 17
Time Table Please see course schedule at e-Campus
Min. participants 20
Max. participants 70
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Claus Varnes - Department of Operations Management (OM)
Main academic disciplines
  • Innovation and entrepreneurship
  • Organization
  • Corporate and Business Strategy
Last updated on 08-04-2014
Learning objectives
Grade 12 will be given to students whom will be able to:
  • Explain the selected theories of business models and analyze the weak and strong points of the core models/frameworks.
  • Analyze and explain the relationship between innovation, strategy and business models.
  • Discuss and analyze how business models can be innovated and articulate the managerial issues relating to these.
  • Reflect, explain and discuss the dynamics of business models based on sociology and core models.
  • Explain the innovation of business models under different innovation strategies.
  • Reflect and explain the organizational changes needed for business model innovation.
Course prerequisites
No prerequisites.
Notice: This is not a course on finance
Prerequisites for registering for the exam
Compulsory assignments (assessed approved/not approved)
Compulsory 15 pages project written in groups up to three students.

Requirements about active class participation (assessed approved/not approved)
No requirements
Examination
Business Model Innovation:
Examination form Oral exam based on written product

In order to participate in the oral exam, the written product must be handed in before the oral exam; by the set deadline. The grade is based on an overall assessment of the written product and the individual oral performance.
Individual or group exam Individual
Size of written product Max. 15 pages
7 pages if it is written individually or 15 pages if it is written in groups up to three students.
Assignment type Project
Duration
Written product to be submitted on specified date and time.
20 min. per student, including examiners' discussion of grade, and informing plus explaining the grade
Preparation time No preparation
Grading scale 7-step scale
Examiner(s) Internal examiner and second internal examiner
Exam period May/June and October
Make-up exam/re-exam
Same examination form as the ordinary exam
The make-up/re-exam will be held in the same way and with the same conditions as the ordinary exam.
Course content and structure
Practitioners are increasingly interested in business models and the innovation of these,  but research has only slowly responded to this significant interest. Hence, this course is an attempt to accommodate this need from the business world by providing a research-based perspective on business model innovation.
 
High performing organizations are able to manage business models. Thus, the course focuses on managerial issues and challenges an established organization face when wanting to manage and innovate business models. Among the dilemmas are that a short and long term perspective has to be applied and that today’s business model is not tomorrows’ answer. Yet, another dilemma, is a central discussion whether a business model is a subject or an object, meaning what are the managerial challenges if a business model is the core logic of a business and therefore not tangible.
 
The course focus on innovation of business models by describing business models in various components and frameworks, discussing the relationship with strategy and sustainability, the application to both service and product based companies, and the dynamics of these.

By the end of this course, the students are going  to be able to:
  • Understand how value is created through business model innovation 
  • Understand the dynamics of business models innovation and why these are changing industries 
  • Recognize and understand the specificity of different business model patterns (e.g fremium model; razor-blade model; etc)
  • Work with five of the most used tools in generting new business models (e.g The four blocks' model, Business model canvas, Chesbrough's model, Teece's innovation model; Davilla's model)
  • Analize the perfomace of a business model
  • Recognize and decide when a business model has reached its tipping point
  • Understand the innovation stategies applied to business models
  • Understand the difference between product and business innovation
Group work is required along the entire semester as the students are going to be given small case studies to solve and present during the course. 
The students are expected to form the groups of max three students at the first course.
Teaching methods
The course is lecture-based through short cases presented in class by the teacher and guest speakers. In-class group work will be required in order to discuss case studies and the issues raised by these.
Expected literature
Text book:
Harvard Business Review on Rebuilding Your Business Model
Source: Harvard Business Press Books 
288 pages.  Publication date: Jun 15, 2011

Complementary materials for each lecture determined by the theoretical themes:

Lecture 1:  Introduction: Definition and Business Model Frameworks
Readings:
 
Text book, chapter 4: Magretta,J., (2011) Why Business Models Matter, Harvard Business Review on Rebuilding Your Business Model
 
Text book, chapter 8: Zook, C., (2011) Finding Your Next Core Business, Harvard Business Review on Rebuilding Your Business Model
 
Teece, D. J. (2010) Business Models, Business Strategy and Innovation.  Long Range Planning, 43, 172-194.
 
Zott, C., Amit, R. (2010) Business Model Design: An Activity System Perspective. Long Range Planning, 43, 216-226
 
Lecture 2: Business Models and Strategy
Readings:
 
Text book, chapter 9: Bower, J., and Christensen, M., (2010), Distributive Technologies: Catching the Wave, Harvard Business Review on Rebuilding Your Business Model
 
Chesbrough, H., Rosenbloom, R. S. (2002) The Role of the Business Model in Capturing Value from Innovation: Evidence From Xerox Corporation’s Technology Spin-Off Companies. Industrial and Corporate Change, 11 (3), 529-555.
 
Shafer, S. M., Smith, H. J., Linder, J. C. (2005) The Power of Business Models, Business Horizons, 48, 199-207.
  
Lecture 3: Sustainability and Business Models
Readings:
 
Kanter, R., M., (2010), From Spare Change to Real Change: The Social Sector as Beta Site for Business Innovation, Harvard Business Review on Business Model Innovation
 
Nidumolu, R., et al (2011), Why Sustainability is Now the Key Driver of Innovation, Greening Your Business Profitability, Harvard Business Review on Greening Your Business
 
Yunus, M., et al (2010), Building Social Business Models: Lessons from the Grameen Experience, Long Range Planning,  43: 308-325
 
Lecture 4: Open Innovation
Readings:
 
Text book, chapter 6: Kim, C., and Mauborgne, R.,(2011) Creating a New Market Space, Harvard Business Review on Rebuilding Your Business Model
Davila, T., Epstein, M., and Shelton, R. (2006) Making Innovation Work, Wharton School Publishing, chapter 2
 
Chesbrough, H. (2003) The era of open innovation. MIT Sloan Management Review, 44 (3): 77-82.
 
Chesbrough, H., Schwartz, K. (2007) Innovating Business Models with Co-Development Partnership, Research Technology Management, 55-59.
  
Goffin, K., Varnes, C., Van der Hoven, C., and Koners, U (2012), Beyond the Voice of the Customer: Ethnographic Market Research, Research Technology Management,
 
Lecture 5: Case study
To be announced.
  
Lecture 6: Servitization
Readings:
 
Chesbrough, H. (2011) Open Service Innovation: Rethinking Your Business to Grow and Compete in a New Era. San Francisco: Jossey-Bass, chapters 1 and 2
 
Cusumano, M. (2003) Business Models That Last: Balancing Products and Services in Software and Other Industries. MIT Sloan School of Management, 197, 1-22.
 
Ettlie, J., E., Rosenthal, S., R. (2011) Service versus Manufacturing Innovation. Journal of Product Innovation Management, 28, 285-299.
 
Lecture 7:Mind-set and core-logic
Readings:
 
Text book, chapter 10: Anthony, S., Eyring, M., and Gibson, Lib, (2011) Mapping Your Innovation Strategy, Harvard Business Review on Rebuilding Your Business Model
 
Demil, B., Lecocq, X. (2010) Business Model Evolution: In Search Of Dynamic Consistency. Long Range Planning, 43, 227-246.

Linder, J. C., Cantrell, S. (2001) Five Business-Model Myths That Hold Companies Back. Strategy & Leadership, 29 (6), 13-18.
 
Linder, J. C., Cantrell, S. (2002) It’s All in the Mind (Set). Across the board, 38-42.
 
Lecture 8: Multiple Business Models: Ambidextrous Organizations
Readings:

O’Reilly, C., and Tushman, M., (2004), The Ambidextrous Organization, Harvard Business Review

Osterwalder, A., Pigneur, Y. (2010) Business Model Generation. Self-published, pp 232- 243
 
Casadesus-Masanell, R., and Tarziján, J., (2012), When One Business Model Isn’t Enough, Harvard Business Review
 
Lecture 9: Business Models Framing and Tipping Points
Readings:
 
Latour, B. (1994) On Technical Mediation-Philosophy, Sociology, Genealogy,Common Knowledge, 3, (2), 29-64.
 
Callon, Michel (1986), Some Elements of a Sociology of Translation: Domestication of the Scallops and the Fishermen of St Brieuc Bay, pp. 196-233 inPower, Action and Belief: A New Sociology of Knowledge, edited by John Law. London: Routledge & Kegan Paul.
 
Lecture 10: Internal and external fit: Case study of Liz Claiborne Inc.
 
Siggelkow, N (2001), Change in the Presence of Fit: The Rise, the Fall, and the Renaissance of Liz Claiborne, Academy of Management Journal, 44, (4),
836-857.
 
Lecture 11: Comprehensive review
To be announced.
Last updated on 08-04-2014