Key Aspects of Sustainable Business Model Innovation

Abstract

Sustainability is one of the new competitive advantages on the market. However, companies cannot maintain planetary boundaries in practice when implementing ESG principles in management. Therefore, it is necessary to implement sustainable practices into the operational process as a whole. The research aims to formalize sustainable business model innovation (SBM-I) as a new tool for social and business value integration. The authors used three analytical tools to formulate the main features of the sustainable business model innovation: business model concept, innovation strategies, and sustainable goals. Using the business model as a common tool to visualize a rational way to create and deliver market value helps to create a framework for inclusively implementing sustainability to improve the outcome on the path to sustainability. The analysis of current advances in business model innovation and practical views of BCG consulting company contributed to the connection between theory and practice. It is pointed out that there is an incremental path to SBM-I, which signifies the level of the company’s maturity. Consistency paths of developing SBM-I in a methodological way provide the connection between strategy and sustainability, making them mutually reinforcing, giving way to action instead of reporting, and realizing a multilevel approach instead of a company-centric one. SBM-I helps to consider all interests of company stakeholders to develop business in an appropriate business ecosystem. Sustainable business model innovation provides a way applicable for companies regardless of activity field, business size, and access to resources.