Business Model Framework for Open Innovation projects in Incumbent organizations: A study on Incumbent organization in Sweden

Karthik Battula has completed his master thesis on the MSPI program. The thesis was conducted in collaboration with Ericsson and focuses on a concept called Minimum Viable Business Models as an approach to facilitate early stage Open Innovation and business model generation in innovation projects.

The title of the thesis is: Business Model Framework for Open Innovation projects in Incumbent organizations: A study on Incumbent organization in Sweden

Download the thesis here: http://bth.diva-portal.org/smash/record.jsf?pid=diva2:1313883

Abstract

This thesis is about exploring the suitable business model framework for open innovation projects in incumbent organizations like Ericsson. Due to the rise in global competition and digitalization incumbent companies cannot innovate in closed innovation systems. Open innovation accelerates the flow of internal and external knowledge for expanding to the new markets by the use of innovation. Companies need reliable and working tools to innovate their business models.

Along with technological innovation, business models also play a dominant role in businesses. Companies need to protect their business models by building them strong. Through making them hard to replicate for placing companies ahead of their competition. Companies employ the business model to understand value creation, delivery, and capture mechanisms. Open innovation explicitly incorporates the business model as a source of both value creation and value capture. Later role of the business model is to enable the organization to sustain its position in the industry(West et al. 2006).

The content of the thesis is explaining how the early stage startups and innovation projects are building their business models in incumbent organizations — then developing a suitable business model framework for such projects in incumbent organizations to building their business ideas. Using design thinking methodologies proposed a business modeling approach with existing tools from the literature for creating a viable business model and using a value-based approach to quantify the value propositions by understanding value delivered to the customer and developing capturing model. By converting those values in monetary terms, it makes it easy to propose a value-based price for the solution. Through this thesis, the author has introduced a framework and process model for business modeling by early stage projects. The contributions were in empirical findings and analysis focused on design thinking-based business modeling approach for MVBM framework and process model.

Keywords

Business model, open innovation, value propositions, business model innovation, business strategy, value creation