Innovating through collaborative business models: Generalizing business model innovation

The present paper presents a novel generalization of business model innovation as an activity taking place across a development and an extension zone, where business model innovation occurs as minor, medium and major changes within both zones. The model explains the process of creating new activity networks by exploring within the extension zone and exploiting within the development zone. While exploration and exploitation take place within both zones, the predominant logic is one of exploitation within the de-velopment zone and exploration within the extension zone, if the two zones are consid-ered as a coherent system. The generalization is explicated in terms of different domi-nant market logics in which collaborative efforts can be positioned. Underlying this presentation, the paper argues that business model innovation involves uncertainty to the degree that innovation is based on cooperative efforts, and that there exists a dialec-tical relationship between sources of selection and sources of survival, which tend to re-inforce one another. This constitutes a new aspect of business model innovation.