Does method matter? An experiment on collaborative business model idea generation in teams
Martin J Eppler
Chair of Communications Management and Managing Director,Institute for Media and Communications Management (MCM), St Gallen, Switzerland
Friederike Hoffmann
Institute for Media and Communications Management, University of St Gallen, Switzerland
Sabrina Bresciani
Research Assistant, Institute of Marketing and Communication Management, University of Lugano, Switzerland
Abstract
The development of new business models is a critical yet demanding task for organizations. It requires, among other things, effective divergent and convergent group processes. A growing body of theoretical literature and empirical evidence shows that artifacts can support collaboration, creativity and innovation in groups. Such artifacts include visual templates, as well as physical objects and sketches. Based on existing theories on idea generation and boundary objects, we propose a model to explain how artifacts can facilitate the development of new business model ideas in teams. Specifically, we hypothesize that artifacts have an impact on perceived group collaboration and perceived creativity, as well as on the decision to adopt a new business model idea. We test the model with an initial experimental study with managers who were asked to develop innovative business models for a daily newspaper, working under one of three different conditions. The subjects worked in groups and were assigned to either: (1) an empty PowerPoint slide (control group); (2) physical objects in combination with sketching; (3) or a visual business model template in a software environment. The results of this pilot study indicate that using a digital visual business model template significantly increases perceived collaboration and actually decreases perceived creativity and the willingness to adopt the business model idea generated. Physical objects in combination with sketching do not lead to different results compared to the control condition of filling out an empty slide. These results provide initial empirical evidence that artifacts have the power to shape the group process of developing new business models, and that our proposed model can capture relevant dimensions of how they affect such a process.
Keywords
innovation, business model, idea generation, collaboration, artifact, boundary objects, visualization
Article Text
Generating new business models is one of today's most challenging tasks for management teams (Chesbrough, 2006; Christensen & Raynor, 2000), since the need for a new business model often arises out of a major disruption or serious crisis of the firm and its current business model, which threatens its survival in a changing market (Johnson, Christensen & Kagermann, 2008; Meehan & Baschera, 2002). Following evolutionary models of the innovation process (Campbell, 1960; Romer, 1993; Simonton, 1999; Singh & Fleming, 2010; Weitzman, 1998), the first step in developing an innovation is to generate a variety of new ideas. In the context of business model innovation, this translates to generating variation in ideas for new business models (Gallupe et al., 1992; Girotra, Terwiesch & Ulrich, 2010; Jung, Schneider & Valacich, 2010; Osborn, 1957).
The focus of this article (partly based on Eppler et al. 2011) is thus on idea generation as the first crucial step towards developing a new business model - after having identified the need and desire to change the current business model of a firm. Developing business model ideas is not an individual task. It requires group collaboration, as the integration of knowledge from different divisions within the firm. It has been acknowledged that idea generation tasks are often generated in formal or informal group collaborations (Garfield et al., 2001; Maccrimmon & Wagner, 1994), which makes idea generation both a cognitive and social process (Dennis et al., 1999; Garfield et al., 2001; Nagasundaram & Dennis, 1993). Teams are considered the building blocks of many organizations (Nijstad & de Dreu, 2002) as they allow a company to integrate diverse expertise, ease co-ordination, and assure mutual accountability. These advantages are also important when creating business model ideas. However, while established processes exist in many firms for generating products innovations in teams, there are no established team processes for generating business model innovations. The academic community has predominantly focused on explaining ex-post how business model innovation is conducted in firms (Johnson et al., 2008; Meehan & Baschera, 2002). Yet no established process or tools are available to manage complexity and, at the same time, foster creativity in the context of business model innovation. It has been noted that sharing, creating and integrating knowledge across epistemic boundaries (Gavetti & Levinthal, 2000) is a requirement for successful business model idea generation. Knowledge sharing, creating and integrating occurs through insights, resulting from the information pooling process (Carlile, 2002, 2004; Dougherty, 1992; Peterovic, Kittl & Teksten, 2001) and from interacting with knowledge sources both inside and outside the team (Harris & Woolley, 2009). As teams may have prerequisites to work on complex issues, they also encounter challenges beyond their prior knowledge and experiences (Nonaka, 1999), which may require to include experts from outside the organization and support them through fitting tools.
An additional challenge for the generation of new business model ideas is the overall complexity of the task (Chesbrough, 2010), as business model idea generation requires the innovation team to consider and understand various and potentially conflicting positions of the stakeholders and units affected and complexity needs to be structured and mastered.
Some of these challenges can be addressed by using artifacts to facilitate the group process of developing new business model ideas. There is evidence that artifacts provide useful support for creative tasks in organizations (Lawson, 2006). For example, three-dimensional objects are used for "Serious Play" in organizations, which has been found to support both abstracting and constructing (Heracleous & Jacobs, 2005; Schrage, 2000) of novel ideas in complex environments. In the specific context of business model innovation, the potential benefits of using artifacts for facilitating innovation has not yet been deeply investigated. A notable exception is the template (or canvas) developed by Osterwalder and Pigneur (Osterwalder & Pigneur, 2009), which is often used in businesses, but which so far has not been systematically analyzed. There is also a similar, but physical business model innovation artifact, the so-called board of board, that allows managers interactively play with the (paper-based) elements of a business model interactively and in this way generate new ideas (see http://www.boardofinnovation.com/).
In this study, we aim to understand how different artifacts affect collaboration and participation in groups working on the development of business model ideas. We will look at this process both from a quantitative (i.e., survey-based) and from a qualitative point of view (i.e., based on observation).
Our theoretical background is based on the concept of boundary objects (Carlile, 2002; Star, 1989; Star & Griesemer, 1989), which suggests that boundary objects support knowledge sharing and creation by functioning as bridging devices. In our study, the boundary objects used are visual templates and physical objects. Hence our research question is: How do artifacts affect the dynamics of groups working on the development of business model ideas?
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