In this paper, we expose how managers within one industry leverage interorganizational collaborations to create a new business model. Based on an inductive case study of an automotive GPS navigation company, we develop an emergent theory of how organizations use interorganizational collaborations to develop new business models.
Our preliminary findings suggest that organizations enact 3 practices: activation (clash between familiar and unfamiliar knowledge), combining (socially constructed projection of the future), and calibration (alignment of interests among partners). These practices enabled the co-creation of a pioneering business model involving four distinct but highly complementary partners. This study provides preliminary insights on a theory of business model innovation via interorganizational collaboration. More broadly, we help open up organization theory to a fresh conceptual lens—the business model—that highlights how organizations work and create value through collaboration.
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