Business model innovations (BMI) represent a major shift in how an organization provides value to its clients, whether via the creation of new revenue streams or avenues for distribution. Despite increasing academic interest, existing research has paid little attention to establish linkage between the value outcomes of coopetition and BMI. Authors explore how BMI in coopetition alliance leads to value creation and value appropriation. Further, it aims to explain the relationship between value creation and value appropriation through BMI in context of coopetition alliances. Grounded on extended resource-based theory, this paper conducts a qualitative investigation based on in-depth interviews with senior executives from the Indian banking sector.
The authors’ empirical context aims at studying business model innovations in coopetition partnerships in the Indian banking industry between 1996 and 2023. It is based on in-depth interviews with business heads and CEOs. A series of key questions were used in semistructured interviews to help identify the topics to be investigated and to provide room for deviation by the interviewer or respondent to delve deeper into an idea or response. The transcribed interviews were coded using NVivo and a series of propositions laid for future researchers.
This paper’s first contribution is to the dynamic adaption of these business models, which will enable organizations to leverage shared resources of partners (Venkatraman and Henderson, 2008; Zott and Amit, 2017). The authors find that business model innovation is vitally important, and yet very difficult to achieve (Chesbrough, 2010). The findings collaborate (Baden-Fuller and Morgan, 2010) that technological innovation is in fact a requirement for the evolution of business models. The second contribution extends the works of (Lavie, 2006; Mathews, 2003; Lewis et al., 2020) on how shared BMI resourced lead to value creation and value appropriation through a framework (Garcia and Aguilera, 2014; Ritala and Tidstrom, 2014).
To the best of the authors’ knowledge, this paper is one of the first to study coopetition alliances using the Extended Resource Based Theory which highlights the development of competitive advantage in situations where resources and capabilities are held beyond the boundary of the firm (Lavie, 2006; Arya and Lin, 2007). The authors extend this by saying that in today’s dynamic world firms may organize themselves and share resources to ensure competitive parity. As competitive advantage is difficult to sustain in the long term (McGrath, 2013), coopetition firms are now innovating their business models looking toward competitive parity.
