Why does Innovation often Requires Changes in the Business Model?

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Why does Innovation often Requires Changes in the Business Model?
Anneke Zwart, Student (University), Netherlands, Member
In cases of major product/technical/process innovation, it is often necessary for organizations to also adapt or reinvent their business model. Why is the reinvention of a business model in case of innovation often necessary?
  1. MAXIMIZING REACH AND SUPPORT: Usually the innovation will already spark disruption, but changing the business model is necessary so as to expand the reach of this innovation and to develop a comprehensive value network so as to maximize the support of the innovation.
  2. ALIGNMENT: In order for innovations to be efficiently designed, implemented and/or launched, the innovation needs to align with the organizationís strategy and its business process, and this requires the reinvention of the business model. An innovation without a business model that aligns with the innovation often leads to cases in which the innovation completely misses its target.
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  Is Business Model Change a Necessity in Innovation?
Derek Lark, CEO, Australia, Member
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