Exploring the Factors Influencing Business Model Innovation Using Grounded Theory: The Case of a Chinese High-End Equipment Manufacturer
Abstract
:1. Introduction
2. Literature Review
2.1. Business Model and Business Model Innovation
2.2. Factors Influencing Business Model Innovation
3. Research Design
3.1. Research Method
3.2. Case Selection
3.3. Data Acquisition
4. Factors Influencing Business Model Innovation
4.1. Open Coding
4.2. Axial Coding
4.3. Selective Coding
4.4. Theoretical Saturation Test
5. Discussion and Conclusions
5.1. External Factors
5.2. Internal Factors
5.3. Guarantee Factors
5.4. Theoretical Contributions
5.5. Managerial Implications
5.6. Limitations and Future Research
5.7. Conclusions
Author Contributions
Funding
Acknowledgments
Conflicts of Interest
Appendix A. Interview Open Questions
- (1)
- Please briefly introduce your work experience, position, education background and so on.
- (2)
- How do you understand business model and business model innovation?
- (3)
- How did the idea about your company’s business model innovation come into being? How is it implemented? Can be exemplified.
- (4)
- Please introduce the process in which you participated in business model innovation recently.
- (5)
- What are the contributing factors to implementing business model innovation in this process? What are the obstacles? How are they solved?
- (6)
- What are the internal factors that you think affect your company’s business model innovation? What are the external factors?
- (7)
- What problems have your company encountered in the process of business model innovation? How was it resolved?
- (8)
- What do you think are the effects of business model innovation on the company?
- (9)
- In what areas do you think the company is working hard to be more conducive to the company’s business model innovation?
- (10)
- What advice do you have for related or similar companies or companies that want to innovate their business models?
- (11)
- Do you have any other views or ideas about enterprise business model innovation?
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Category | Original Statement (Initial Concept) |
---|---|
Government policy | In recent years, the “Made in China 2025”1 and strategy of the “Belt and Road Initiative”2 promulgated by the state has given us a great guiding role. In line with the state policy and the current development of the Company, we have put forward the concept of service-oriented development in the field of intelligent manufacturing. Another example is the acquisition of the Czech Republic 3 as a country along the Belt and the Road, in a sense, this is a political task for state-owned enterprises in responding to the policy need (Policy guidance). |
The state will give preferential tax treatment for the manufacturing industry and provide financial support for scientific research projects. In 2014, it declared six government funded scientific and technological projects and obtained a number of government grants (Preferential policy). | |
The government has also recognized and encouraged entrepreneurs to innovate. They have held many exchange meetings and forums about business model innovation and government leaders on many occasions to conduct business seminars and visits (Government behavior guide). | |
User needs change | We started with the customer’s needs and focused on the customers who bought the blowers and bought the service and operation. So, at that time, we proposed “two changes” (Customer needs change). |
Market environment change | The threat of alternative technology and the competition in the market environment are increasing, which has forced enterprises to transform their existing work process. In order to keep abreast of the changing times, continuous adjustment and change are being carried out within the company (Market competition intensified). |
“Made in China 2025” and “Belt and Road” have also brought many market opportunities for enterprises such as the technology and market breakthroughs brought by the inclusion of the Czech Republic (Market opportunity). | |
Entrepreneurship | A graduate from the engineering department, our Chairman became the leader in charge of the first change from technology to sales transformation when he was 44 years. Full of courage and insight, he is a very good at learning from experts and peers (Adventure and innovation spirit). |
Two transitions were closely related to the recognition, understanding, judgment and continuous self-reflection and self-denial awareness of the Yin manager (Self-reflection and negation). | |
Realizing the appearance of the ceiling in traditional industries or manufacturing, Yin proposed. Consequently, he proposed changing from a single product to a service, and from a single product to brand and capital operation (Vision). | |
In the first year of the strategic new layout, he felt that a new bottleneck appeared. He believed that in the field of distributed energy, the market space in the past was tens of billions, and the market space now is one trillion (Forward looking). | |
Information technology | Nowadays, the development of the Internet has led to the innovation of the Shaanxi Blower business. Since 2003, the application of network technology has greatly helped us to promote the service (Network technology application). |
Technological innovation | The internal research and development investment in Shaanxi Blower now account for 8–10% of its sales. Technological innovation is also emphasized in all aspects of the enterprise. In particular, the improvement of internal intelligent management can help enterprises to continually change business processes (Internal technological progress). |
Culture change | Culture is a banner. Reviewing the Shaanxi Blower development in the past 10 years, culture has played a very good role in promoting development. The culture follows the process of production. The quality department has its culture, the same as the strategy department and others. Through the implementation of these cultures, the business development has been promoted (Cultural matching). |
Strategic transformation | In the past, we created green power for human energy and are now talking about human green energy services. We will redefine our vision mission (Redefine the vision and mission). |
Culture should follow as well as interact with the strategy changes. The culture is supported by the system and is then integrated into the process. Culture is supposed to protect the development of the enterprise (Cultural and strategic interaction). | |
Dynamic capability | When considering the business model innovation, we must first analyze the existing resources of the enterprises, not only to integrate internal resources, but also to take into account the utilization and integration of external resources (Resource integration ability). |
As a system integrator, similar to contractors, we are able to bring together all enterprises of the industrial chain and to lead our cooperative enterprises to complete the project contract (System integration capability). | |
We are now developing in the field of energy conservation, combining our own advantages to expand new markets. In addition, overseas markets are also in our key directions. Our products, technologies, and services should go into the global markets, enhancing our competitive competence (Market expansion capability). | |
In order to further shorten the process and improve the ability to solve problems as well as respond to the market rapidly, the company started the reengineering process of the Shaanxi Blower power operating production line at the end of 2014 (Process reengineering capability). | |
Shaanxi Blower actively learned from Europe’s experience in Industry 4.0 and has integrated with various supporting manufacturers, industry technologies, and various data generated in the whole industry chain (Learning ability). | |
Innovation capability | We have set up an innovative position within the company to stimulate staff’ innovation. In the process of employee innovation, we require leaders to actively support and guide staff innovation (Full innovation awareness). |
Company provides a wide range of staff training. The company opened the Shaanxi Blower Network University, staff Weekend Learning Day, and has encouraged employees to learn from each other to form a good learning and innovation atmosphere (Employee innovation capability improvement). | |
The company set up special bonuses, recommending awards for crowdfunding wisdom activities, achievement implementation awards, and creating the implementation of financial support, etc. (Innovation incentive). | |
Talent introduction | In recent years, Shaanxi Blower has introduced many talented peoples who are capable of supporting business units independently in the professional field, which is considered as a basic condition for business development (External introduction of talent). |
Talent cultivation | Shaanxi Blower has established a professional channel suitable for the development of those passionate employees seeking their proper positions through competitive recruitment (Internal emphasis on the cultivation and selection of innovative talents). |
Relationship Category | Relation Category | The Connotation of the Relationship | |
---|---|---|---|
1 | Government policy | Government policy | In the field of high-end equipment manufacturing, the state actively fostered markets, deepened international cooperation and guided it at a macro level. The government held many seminars in the Shaanxi Blower Group that emphasized, encouraged, and supported innovation. |
2 | Entrepreneurship | Entrepreneurship | In the background of industry development trends, the Chairman of Shaanxi Blower proposed the development strategy of transforming the enterprise into a service provider. He ventured boldly to implement administrative management in the enterprise, due to which he is regarded as one of the major promoters of “strategic transformation”. |
3 | Market pressure | User needs change | In the face of overcapacity in the manufacturing industry, the accelerated development of the industry, and the individualized needs of customers, Shaanxi Blower has reshaped its business processes, enhanced dynamic momentum to cope with changes in the internal and external environment, and extended the industrial chain to provide customers with comprehensive life-cycle services. |
Market environment change | |||
4 | Technology | Information technology | The development of various technologies quickly integrates industrial normalization, locating customer needs accurately and optimizing the business process. Therefore, it is considered as the core force to transform Shaanxi Blower into a service-oriented company and toward “two changes”. |
Technological innovation | |||
5 | Strategy and culture | Strategic transformation | Shaanxi Blower promoted cultural reconstruction and administrative management, and guided the staff to change their thinking and behavior. Under the guidance of strategy and culture, employees reinforced the awareness of learning and innovation, thus supporting the strategic choice of the service-oriented transformation of enterprises in agreement. |
Culture change | |||
6 | Organizational Capabilities | Dynamic capability | In order to implement the service-oriented strategy, it is necessary to reshape the original internal business processes, business structure, and change employee’s behavior, thinking, and awareness. Therefore, Shaanxi Blower has implemented a high investment in many aspects such as resource integration, system integration, process reengineering, organizational learning, and innovation policies to enhance brand image, realize economic benefits, and meet the needs of transformation. |
Innovation capability | |||
7 | Human resources | Talent introduction | Service-oriented transformation is rooted in the cultivation of innovative talent and the fusion of innovative awareness. By introducing middle and high-end talents, Shaanxi Blower has not only set up a sound training and compensation system, but also increased its investment in research and development including training professionals in innovation and applying “core technology” into service. |
Talent cultivation |
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Share and Cite
Tian, Q.; Zhang, S.; Yu, H.; Cao, G. Exploring the Factors Influencing Business Model Innovation Using Grounded Theory: The Case of a Chinese High-End Equipment Manufacturer. Sustainability 2019, 11, 1455. https://doi.org/10.3390/su11051455
Tian Q, Zhang S, Yu H, Cao G. Exploring the Factors Influencing Business Model Innovation Using Grounded Theory: The Case of a Chinese High-End Equipment Manufacturer. Sustainability. 2019; 11(5):1455. https://doi.org/10.3390/su11051455
Chicago/Turabian StyleTian, Qingfeng, Shuo Zhang, Huimin Yu, and Guangming Cao. 2019. "Exploring the Factors Influencing Business Model Innovation Using Grounded Theory: The Case of a Chinese High-End Equipment Manufacturer" Sustainability 11, no. 5: 1455. https://doi.org/10.3390/su11051455