Year: 2021
Type: article
Abstract: This study seeks to provide new insights into the performance effects of firms’ business model innovation (BMI) activities. Adopting an institutional perspective, we hypothesize that there is an S-shaped relationship between a firm’s BMI intensity and financial performance, which is contingent on industry factors, particularly the average industry BMI intensity and industry growth. To test our hypotheses, we use 10-K annual reports from 6,678 publicly listed U.S. firms between 1994 and 2018, based on which we create a novel text-based measure of BMI intensity, as well as archival data. Our results support our prediction that the BMI-performance relationship is S-shaped. We further find that the average industry BMI intensity positively, and industry growth negatively moderates this S-Shaped relationship. Overall, our study contributes to a better understanding of the BMI-performance relationship and helps to reconcile competing perspectives (i.e., conformity vs. differentiation) on how far engaging in BMI activities.
Authors: Esau, Eduard, Jung, Christopher, Schaeper, Thomas, Piening, Erk, Foege, Johann Nils
Institutions: Leibniz University Hannover, University of Münster
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7008578712