Service-Dominant Business Model Design for Digital Innovation in Smart Mobility

In many business domains, rapid changes have occurred as a consequence of digital innovation, i.e., the application of novel information technologies to achieve specific business goals. A domain where digital innovation has great potential is smart mobility, which aims at moving around large sets of people and goods in a specific geographic setting in an efficient and effective way. So far, many innovations in this domain have concentrated on relatively isolated, technology-driven developments, such as smart route planning for individual travelers. Nice as they are, they have relatively small impact on mobility on a large scale. To achieve substantial digital innovations – for example, optimizing commuting on a city-scale – it is necessary to align the efforts and related values of a spectrum of stakeholders that need to collaborate in a common business model. To this aim, the study proposes the use of service-dominant business logic, which emphasizes the interaction of value network partners as they co-create value through collaborative processes. Moving to this paradigm has significant implications on the way business is done: the business requirements for services will change faster, and the complexity of value networks required to meet these requirements will increase further. This requires new approaches to business engineering that are grounded in the premises of service-dominant logic. The paper introduces the service-dominant business model radar (SDBM/R) as an integral component of a business engineering framework. Following a design science approach, the SDBM/R has been developed in close collaboration with industry experts and evaluated through an extensive series of hands-on workshops with industry professionals from several business domains. This paper focuses on the application and evaluation in the smart mobility domain, addressing the design of new business models for digital innovation of collaborative transport of people and goods. In summary, it contributes a novel business design approach that has an academic background and relevant practical embedding

Governance in niche development for a transition to a new mobility regime

Urban mobility is a difficult sustainability challenge; measures to reduce transport impacts produce only marginal reductions in overall energy use and CO2 emissions. Even fuel switch to electric vehicles and measures to manage traffic produce insufficient improvements. Seeking transport sustainability within the existing socio-technical regime involves policy approaches for dense cities to provide high-capacity, corridor-based public transport, expecting people to arrange their lives around such transport systems. Yet this socio-technical regime ill-fits modern mobility needs. The reluctance to use public transport stems much from this 150 year old regime configuration. The social-technical landscape has shifted significantly: travel patterns are increasingly dispersed in space and time – not funnelled into traditional corridor peak-hour movements. The key is not getting people to return to travel patterns of 100 years ago, but in a transition to a socio-technical transport regime that delivers sustainability compatible with the 21st century social-technical landscape. An opportunity may be emerging for socio-technical configurations in niche environments to effect transitions to alternate mobility futures. Autonomous vehicles are rapidly approaching market application. Since 2011, small autonomous pods have operated on segregated tracks at Heathrow Airport. In 2014 a similar system opened at the Suncheon Bay tourist area in South Korea. Since 2011 there have been public street trials of autonomous vehicles in the USA and in 2015 they became street legal in the UK. The Milton Keynes (MK) ‘Pathfinder’ project focuses on two-seat pods which do not need segregated tracks, but will run on cycleways and footpaths, mixing with cyclists and pedestrians. Trials will start in 2015, on short distance links from the railway station to destinations in Central Milton Keynes. This project forms part of the wider Milton Keynes Future Cities Programme and Open University-led MK:Smart project. This paper draws on these trials in MK to show through case study research how autonomous vehicles applications are moving beyond protected niches and, along with other developments, hold the potential to stimulate a major transition in public transport systems. The vehicles are small and each journey is individual to the passenger(s). Services do not run along corridor routes, like buses and trams, but are based on alternate rule-sets to the existing regime with individual journeys customised for each user. Such developments may therefore stimulate transition to totally different sorts of public transport systems and ultimately, socio-technical mobility regimes, by offering much more to users than any corridor system can provide. Rather than people adjusting their behaviour to bus routes, schedules and operating times, they travel directly, whenever they want, on services running 24/7. Thus these new regimes could be more compatible with lifestyle and economic trends that comprise 21st century socio-technical landscapes. As such, they provide credible alternatives to the private car, and so hold potential to deliver major sustainability gains. But such transitions face major challenges from entrenched actors within the existing regime. Taxis, minicabs and bus operators would be threatened. If the Uber cab app is being blocked by incumbent actors, they look likely to be powerful opponents of autonomous vehicle based cab services. However, MK provides an interesting innovation context where there are several overlapping smart transport niches in different stages of development. As well as autonomous pods, demand responsive minibuses are planned and inductive changed electric buses are in service. If these projects build links to each other (niche accumulation), demonstrate economic value and reproduced beyond their original experimental spaces (niche proliferation), there is potential for them to overcome incumbent resistance. In Milton Keynes, these processes could be getting close to reaching critical mass, opening up the possibility of moving closer to radical regime transitions

The impact of Digital Platforms on Business Models: an empirical investigation on innovative start-ups

Digital platforms have the ability to connect people, organizations and resources with the aim of facilitating the core interactions between businesses and consumers as well as assuring a greater efficiency for the business management. New business concepts, such as innovative start-ups, are therefore created based on innovation, scalability and the relationships within the community around them. The purpose of this work is to deeply understand the evolution of business models brought by innovative and dynamic companies operating through online platforms. In order to achieve the objectives set, an exploratory multiple-case study was designed based on in-depth structured interviews. The aim was to conduct a mixed analysis, in order to rely both on qualitative and quantitative data. The structured interview protocol was therefore designed to collect and then analyse data concerning the company profile and managers’ perspectives on the phenomenon of interest. The interview protocol was submitted in advance and then face-to-face interviews were carried out with the following professional figures: Chief Executive Officer (CEO), General Manager, Chief Technology Officer (CTO), Marketing Manager and Developers. Collected data were analysed and processed through the Canvas Business Model in order to clearly outline similarities and differences among the sample. Results can be considered under two viewpoints. On the one hand, this work provides a detailed overview of the companies interviewed, according to the dimensions of: reference market dynamics, type and number of customers, scalability. On the other one, they allow to identify some success patterns regarding key activities, key resources, channel mix strategy, costs management, value proposition, customer segmentation, key partners and the way to obtain revenues. Results from the multiple-case study with 15 Italian start-ups provide interesting insights by comparing the innovative business models developed and highlighting key differences and similarities. verall, the start-ups analyzed, operating in several sectors, showed great growth prospects and the possibility to create value for their customers through innovative products and services offered through digital platforms

Roadmaps to Utopia: Tales of the Smart City

Notions of the Smart City are pervasive in urban development discourses. Various frameworks for the development of smart cities, often conceptualized as roadmaps, make a number of implicit claims about how smart city projects proceed but the legitimacy of those claims is unclear. This paper begins to address this gap in knowledge. We explore the development of a smart transport application, MotionMap, in the context of a £16M smart city programme taking place in Milton Keynes, UK. We examine how the idealized smart city narrative was locally inflected, and discuss the differences between the narrative and the processes and outcomes observed in Milton Keynes. The research shows that the vision of data-driven efficiency outlined in the roadmaps is not universally compelling, and that different approaches to the sensing and optimization of urban flows have potential for empowering or disempowering different actors. Roadmaps tend to emphasize the importance of delivering quick practical results. However, the benefits observed in Milton Keynes did not come from quick technical fixes but from a smart city narrative that reinforced existing city branding, mobilizing a growing network of actors towards the development of a smart region. Further research is needed to investigate this and other smart city developments, the significance of different smart city narratives, and how power relationships are reinforced and constructed through them

Defining and assessing the transformational nature of smart city governance: Insights from four European cases

Smart cities are a new approach to urban development based on the extensive use of information and communication technologies and on the promotion of environmental sustainability, economic development and innovation. The article is aimed at discussing whether the adoption of a smart city approach entails the transformation of existing institutional structures and administrative practices. To this end, four cases of European smart cities are analysed: Amsterdam, Barcelona, Turin and Vienna. The article describes their models of governance, investigates the level of transformation that occurred in their governmental structures, outlines the main drawbacks and identifies possible connections with the emergent paradigm of the New Public Governance

Digitalization and Innovation

Developments in digital technology offer new opportunities to design new products and services. However, creating such digitalized products and services often creates new problems and challenges to firms that are trying to innovate. In this essay, we analyze the impact of digitalization of products and services on innovations. In particular, we argue that digitalization of products will lead to an emergence of new layered product architecture. The layered architecture is characterized by its generative design rules that connect loosely coupled heterogeneous layers. It is pregnant with the potential of unbounded innovations. The new product architecture will require organizations to adopt a new organizing logic of innovation that we dubbed as doubly distributed innovation network. Based on this analysis, we propose five key issues that future researchers need to explore.innovation, innovation, product architecture, design rules

Evaluating the Design of Service-Dominant Business Models: A Qualitative Method

Background: Driven by factors such as digitization and rapid technological change, many contemporary organizations adopt a service orientation to sustain competitiveness and to improve their value propositions to customers. In doing so, organizations typically engage in collaborative service ecosystems to co-create value and exchange services, and conceptualize such collaborations using business models. The resulting models should be evaluated to support the development of service ecosystems and their long- term viability. Despite academic efforts on the evaluation of traditional, organization- centric business models, limited research is present supporting the evaluation of service- dominant business models, taking into account their key characteristics, such as service exchange and value co-creation in business networks. Method: Following a design science research methodology, we have iteratively designed a method addressing the qualitative evaluation of service-dominant business models, building on and integrating the theory on service-dominant logic, business model design and business model evaluation. To structure the steps of the design process, we leverage a situational method engineering approach, following a paradigm-based strategy. To evaluate the validity and utility our method, we have applied it to a real-life business case in the mobility domain, involving eight industry stakeholders in the process. Results: The method constitutes a set of guiding questions and a procedural description of their use, addressing the evaluation concerns of feasibility, viability, structural validity and robustness with respect to the service-dominant business model. The results of the evaluation demonstrate that the use of the method facilitates users to reflect qualitatively on design decision with respect the business model design and offers insights on its expected performance. Conclusions: This work contributes to extant research on service systems engineering and the instantiation of service-dominant logic, clarifying how service ecosystems can be evaluated through the business model concept and explicating how business models are impacted through service-dominant logic