Business Model Assessment and Innovation: A Diagnostic Approach to Defining the Right Time to Undertake Transformation

Abstract

In a rapidly evolving economic context, leaders of established organisations must detect weak signals from the "inflection points" representing fundamental changes in the business environment (McGrath, 2019). Organisations able to detect these shifts early enough are better positioned to take timely and appropriate decisions to reinvent their business models (Bertolini et al., 2015). The purpose of this study is to shed light on the business model innovation process, with particular attention to the role of the assessment step within an established organisation active in the healthcare space. The organisation selected, here called MDM, represents a unique case for understanding how the traditional "treatment-driven" business model was transformed in favour of a "patient-centric" business model in the period between 2012 and 2014. Considering the limited knowledge on this topic, I have selected an inductive investigation guided by the Grounded Theory approach and based on a qualitative interpretative perspective. The literatures on system theory and on business model assessment and innovation have been combined in this study to show how MDM leaders have been able to detect the inflection points emerging from the business environment and accordingly transform the extant business model. This involved a process made up of three critical phases: (1) Sensemaking, (2) Shaping, and (3) Executing. This study emphasises how the systemic approach adopted by the MDM leadership team- working to assess the relevance of the extant business model at both the single components level and the interrelations level has been crucial for detecting the emerging inflection points and aligning the organisation around a transformation agenda in a market context where all other major competitors kept their original business models. Combining contributions from the literature with the evidence from the MDM study, a Business Model Dashboard has been developed to support leaders in understanding when is the right moment to start innovating their business model. Finally, the research contributes to the business model literature by offering a system theory perspective on its innovation, providing insights about the fundamental determinants of the transformation process with which leaders need to be able to deal to maintain their relevance in the market and thrive.

Date of Award	1 Aug 2021
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Martin Henery (Supervisor) & Matthew Mccaffrey (Supervisor)