Business model innovation in small- and medium-sized enterprises: Strategies for industry 4.0 providers and users

Abstract

Purpose: Industry 4.0 is expected to significantly transform industrial value creation. However, research on business models affected through Industry 4.0, and on small- and medium-sized enterprises (SMEs), remains scarce. In response, the purpose of this paper is to address both aspects, further elaborating on the role that SMEs can take toward Industry 4.0 as provider or user. Design/methodology/approach: The paper used an exploratory research design based on 43 in-depth expert interviews within the three most important German industry sectors, mechanical and plant engineering, electrical engineering and automotive suppliers. Interviews were conducted with leading personnel of the respective enterprises, including 22 CEOs. They assign business model implications through Industry 4.0, referring to the Business Model Canvas, while the paper delineates between Industry 4.0 providers and users. Findings: The paper finds that key resources and value proposition are among the most affected elements of the business model, whereas channels are the least affected. Furthermore, distinct characteristics between Industry 4.0 providers and users can be delineated. In general, Industry 4.0 providers’ business models are significantly more affected than users, except for key partners and customer relationships. Research limitations/implications: Industry 4.0 remains at its early stages of implementation. As a result, many interviewees’ answers remain at a rather general level. Practical implications: Strategies for the further alignment of the business models are provided for Industry 4.0 providers and users. Originality/value: The paper is among the few that investigate Industry 4.0 in the context of SMEs and business models.