Designing business models in the era of Internet of Things: Towards a reference framework

Abstract

The increasing pervasiveness of digital technologies, also refered to as "Internet of Things" (IoT), offers a wealth of business model opportunities, which often involve an ecosystem of partners. In this context, companies are required to look at business models beyond a firm-centric lens and respond to changed dynamics. However, extant literature has not yet provided actionable approaches for business models for IoT-driven environments. Our research therefore addresses the need for a business model framework that captures the specifics of IoT-driven ecosystems. Applying an iterative design science research approach, the present paper describes (a) the methodology, (b) the requirements, (c) the design and (d) the evaluation of a business model framework that enables researchers and practitioners to visualize, analyze and design business models in the IoT context in a structured and actionable way. The identified dimensions in the framework include the value network of collaborating partners (who); sources of value creation (where); benefits from collaboration (why). Evidence from action research and multiple case studies indicates that the framework is able to depict business models in IoT. © 2014 Springer International Publishing.