AI and Business Model Innovation: Leverage the AI Feedback Loops

Evangelos Katsamakas and Oleg Pavlov


AI strategy, Business Model, Platforms, Digital Transformation, Dynamic Complexity


Purpose: The article analyzes the effects of Artificial Intelligence (AI) on Business Model Innovation (BMI), focusing on the platform business model.

Design/Methodology/Approach: Proposes a CLD (Causal Loop Diagram) model and analyzes the model to discuss insights about the structure and performance of the business model.

Findings: Shows that AI enables key strategic feedback loops that constitute the core structure of the business model.

Practical Implications: Managers and entrepreneurs who seek to leverage AI should invest in the AI feedback loops. An AI strategy for BMI should seek to create, strengthen, and speed-up AI feedback loops in the business model.

Originality/Value: Analyzes the effects of AI on BMI while accounting for dynamic complexity as a business model property to be understood and leveraged. Contributes to our understanding of the business value and impact of AI.