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2013/2014  KAN-CM_SU8S  Business Model Innovation

English Title
Business Model Innovation

Course information

Language English
Exam ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration Summer
Course period Please check www.cbs.dk/summer for the course schedule.
Time Table Please see course schedule at e-Campus
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Course instructor - Claus Varnes, CBS
    Patricia Plackett - Department of Operations Management (OM)
Main academic disciplines
  • Innovation and entrepreneurship
  • Organization
  • Corporate and Business Strategy
Last updated on 25-01-2013
Learning objectives
At the end of the course the student should be able to:
  • Define and describe the core models/frameworks of business models
  • Understand and analyze the relationsship between innovation, strategy and business models including issues on sustainability
  • Discuss and analyze how business models can be innovated and articuluate the managerial issues relating to this
  • Understand, explain and discuss the dynamics of business models based on sociology and core models
Course prerequisites
No prerequisites.
Note: This is not a course on finance
Prerequisites for registering for the exam
Requirements about active class participation (assessed approved/not approved)
Mandatory Mid-term Assignment:
Mid-term assignments will be organized as small team oral presentations. The students will be asked to work in groups of maximum five persons and they will be required to write a 3-4 page paper that compares and analyses the different approaches to business models frameworks, for example, Osterwalder et al (2010) and Chesbrough, H., Rosenbloom, R. S. (2002). Furthermore, the comparison has to be made by using case studies chosen by them. Each group will have to prepare a maximum of ten-minute power point presentation, and be prepared for a five minutes questions and answers session. The discussions, followed by feedback, will give all students a better understanding of the sensitive issues when analysing business models.
Home project assignment:
Examination form Home assignment - written product
Individual or group exam Individual
Size of written product Max. 15 pages
Assignment type Written assignment
Duration Written product to be submitted on specified date and time.
Grading scale 7-step scale
Examiner(s) One internal examiner
Exam period Summer Term
Make-up exam/re-exam
Same examination form 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 organization faces when wanting to manage business models. Among the dilemmas are that a short and long-term perspective have to be applied and that today's business model is not tomorrow's answer. Another dilemma is a central discussion as to 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 focuses on innovation of business models by describing business models in various components and frameworks, discussing the relationship with strategy and sustainability and the application to both service and product-based companies, as well as the dynamics of these.

The students will develop their competences in analysing complex business model issues and an ability to focus on managerial dilemmas. Many decision-making situations in the student’s future career will challenge an evaluation of what is considered relevant and irrelevant within an organization. We hope to expand this competence with the focus on managing business model innovation that contains many strategic challenges.
More specifically, the student will after the course be able to:

  • Describe business models, including components and frameworks;
  • Analyse business models in various industries and types of companies, e.g. service and products
  • Understand the strategic role of business models and the relationship with strategy
  • Comprehend the dynamics of business models with respect to certain sociologies
  • Discuss the framing of business modelling with respect to sustainability, open innovation and ambidextrous organization
  • Understand the managerial challenges while  managing a business model in an organizational context
  • Develop the ability to understand complex systems and connections
  • Develop analytical prowess
  • Build confidence in knowledge of how value is created by organizations
  • Ability to access and interpret business and economic news
Teaching methods
The course is lecture-based through short cases presented in class by instructors. In-class group work will be required in order to discuss case studies and the issues raised by these.

Preliminary Assignment: To help students get maximum value from ISUP courses, instructors provide a reading or a small number of readings to be read before the start of classes with a related task or tasks in the first two classes in order to 'jump-start' the learning process. As a preliminary reading assignment students will have to read the first five chapters from the text book: Harvard Business Review on Rebuilding Your Business Model, 2011, which encompasses about 100 pages. These chapters will provide the theoretical foundation necessary for further developing discussions in the class. Furthermore, students are required to read the journal articles in the course outline as they will have the responsibility to prepare critical assessment, in groups, of one or two designated articles. This task will be announced in the first lecture.
Expected literature

Lecture 1:  Definition and Business Model Frameworks
Main points:

  • Disagreements about definition, number of components and frameworks for business models
  • Value proposition considered the most important component by the majority of reserachers
  • Canvas business model

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: AnActivity System Perspective. Long Range Planning, 43, 216-226
Lecture 2: Business Models and Strategy
Main points: 

  • Disagreements whether business models should mirror strategy

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
Main points: 

  • Is sustainability an input or output for a business model?
  • Disagreements concerning the elements what should be changes under a sustainability strategy

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
Main points:

  • Is business model a radical or incremental type of innovation?
  • How does a business model acts under an open innovation strategy?
  • Creating new business opportunities
  • Involving customers: ethnographic research

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: Group presentations of the mid-term paper
To be announced.
Lecture 6: Servitization
Main points:

  • Disagreements concerning the level of distinguishes between service and manufacturing companies
  • Service business models versus product business models

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
Main points:

  • Complex to analyze business models
  • Organizational change versus business models

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
Main points: 

  • Dilemmas for short term versus long term innovation
  • Dilemmas concerning how many business models should a company have

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

Osterwalder, A., Pigneur, Y. (2010) Business Model Generation. SelfDpublished, 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

Main points: 

  • Innovation is overcoming resistance
  • Business models are a mediation process

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: Case study of Liz Claiborne Inc.
Siggelkow, N (2004), Change in the Presence of Fit: The Rise, the Fall, and the Renaissance of Liz Claiborne, pp. 605- 623, in Managing Strategic Innovation and Change, Tushman, M., and Anderson, P., second edition, New York: Oxford University Press
Lecture 11: Comprehensive review
To be announced.

Last updated on 25-01-2013