Service-driven Business Model Innovation

This chapter examines business model innovation driven by increased service focus. The chapter discusses the external drivers and organizational implications of shifting toward service-based business models. Driven both by competition and by new customer demands, many firms find themselves moving from their traditional business models based on, primarily, product sales toward business models based on services. As business success in this setting depends as much on such organizational rearrangements (including business model redesign) as it does on new service development, examining the organizational implications of this shift becomes crucial. Hence, the chapter discusses how firms can approach and understand this change to their business models, and also how their organization can become more service-oriented in order to take advantage of the emergent opportunities inherent in this shift.