This paper aims to explore how manufacturing firms pursue business model innovation (BMI) through their use of outside-in thinking.
Survey data were collected on 175 Chinese manufacturing firms. A regression model was used to verify the research results.
Manufacturing firms rely on outside-in thinking to develop BMI under different market and institutional environments. From a whole-value-chain perspective, interacting with customers and sharing information with suppliers are two key ways to develop BMI.
Firms focus on customer needs, sense the dynamics of external markets and technology and seize market opportunities to measure outside-in thinking. Empirical results suggest using other measures of outside-in thinking. BMI itself can be multidimensional, so scholars could consider BMI’s diverse dimensions and measurements, which may demand different kinds of outside-in thinking.
Manufacturing firms can use outside-in thinking to overcome inertia and rigidity and increase their knowledge, information and technology. Managers should develop outside-in thinking to respond quickly to emerging economies. Managers should use value chain collaboration and improve the firm’s capacity to interact with customers and suppliers to apply the benefits of outside-in thinking to their BMI.
The study explores how outside-in thinking is a key driver of BMI. Applying the whole-value-chain view, it finds that interacting with customers and suppliers connects outside-in thinking with BMI. It also highlights the effects of intense market competition and volatile government regulation on BMI.
