Abstract

     Although research underlines the need for SMEs to innovate their Business Model, they face considerable challenges in exploring external business opportunities and experimenting/developing their available resources in unexpected ways. We posit that one way that SMEs can innovate their Business Model is through exaptation, a discontinuous evolutionary process that allows utilizing and adapting existing resources in new application domains. Using a case study approach, we investigate the case of a SME that has successfully innovated its Business Model through exaptation. We then discuss how three key exaptation processes lead to value creation, delivery and capturing, thus supporting Business Model Innovation in SMEs.

Introduction

     Business Model Innovation (BMI) has been described as “the search for new logics of the firm and new ways to create and capture value for its stakeholders” (Casadesus‐Masanell and Zhu, 2013, p. 464). In this perspective, firms can create and exploit new opportunities linked to their innovative Business Model (BM) by adopting different approaches. Firms might add novel activities through backward or forward integrations, connect activities in a novel way, or modify one or more parties dedicated to any of the activities (Amit and Zott, 2012). For example, firms can choose to alter the set of elementary activities they perform and rely on the resources or technological capabilities of external parties (such as individual, organizations, universities) to develop a new value proposition (Chesbrough, 2007; Saebi and Foss, 2015).

     Researchers underline that BMI is becoming even more important for success than product/service or process innovation (Johnson et al., 2008; Amit and Zott, 2012). However, practitioners have little guidance on how to design innovative BMs (Foss and Saebi, 2017; Teece, 2018). This is particularly true for Small and Medium-Enterprises (SMEs), the main actors in innovation processes and technological development at the local, regional, and even national level (Lee et al., 2012). Accordingly, recent international policies have emphasized the need for SMEs to redefine their BM to sustain and promote their competiveness. In this perspective, BMI is a potentially relevant tool allowing SMEs to resolve the trade-off between innovation costs and benefits, enabling them to create, deliver, and capture new value.

Conclusions

     Prior research has emphasized the pressing challenge for SMEs to exploit, define, and implement an innovative BM to remain competitive. Anecdotal evidence shows that innovative BMs are closely linked to exaptation, observed as an important mechanism to use resources in ways for which they were not originally intended (Dew et al., 2004; Cattani, 2006). This might be particularly fruitful for SMEs that have some difficulties in “thinking outside the box” (Gassmann et al., 2013, p. 2), but at the same time, specific advantages in developing new products and businesses (Vanhaverbeke, 2017). Prior BMI studies have mainly focused on large firms and start-ups, but seldom on SMEs, and to the best of our knowledge, no studies have hitherto focused explicitly on the processes to be implemented to sustain BMI through exaptation in SMEs.

     This study has investigated how SMEs might innovate their BM through exaptation. In analyzing the exaptation process in SMEs, we advance knowledge on how and why exaptation favors BMI. In addition, our study highlights how each stage of exaptation process contributes to BMI by means of value creation, value delivery and value capturing.