Network configuration, customer centricity, and performance of open business models: A solution provider perspective

Karolin Frankenberger, Tobias Weiblen, Oliver Gassmann
2013 Industrial Marketing Management  
While research has shown a positive impact of open business models on value creation, it has remained silent on the configuration of the corresponding partner networks and their effect on performance. Studying three cases of solution providers which involve external service partners for solution delivery, we find that solution customer centricitythe degree to which the focal firm focuses on solution customers in the joint delivery of solutionsmoderates the relationship between partner networks
more » ... nd open business model performance. For open business models with low solution customer centricity, a network configuration characterized by many weak ties to service partners leads to superior performance. Conversely, for open business models with high solution customer centricity, few but strong ties to partners lead to superior performance. Based on these findings, three ideal configurations of networks for open business models are derived: the controlled, the joint, and the supported model. The findings of this paper are especially relevant for managers of product-focused firms who seek guidance in evolving their business models into solution providers. The paper also contributes to business model research by linking extant insights from network research to open business model performance. Although open business models are by definition closely linked to the establishment and management of external networks, research falls short in explaining the configuration of these networks and their impact on the performance of open business models. Understanding these relationships is of particular relevance for manufacturing companies facing the organizational challenge to become solution providers. A solution provider manufactures stand-alone products as well as bundling them with related services into solutions that solve customers' problems ), but not the required network setup and logic for successful delivery of solutions. This raises two research questions we aim to answer in this article: Firstly, how do various network configurations in relation to service partners influence the performance of open business models? Secondly, what is the role of varying degrees of customer centricity of open business models in this setting? We study these questions in the context of solution providers as a good backdrop. To come to an answer we build on network theory, which argues that a network of relations of firms produces positive but also negative results (e.g., Lechner, Frankenberger, & Floyd, 2010) .
doi:10.1016/j.indmarman.2013.05.004 fatcat:pulaxgofkvhpjjtuw7ixyw4uge