Business models and business model innovation: theoretical development of a conceptual, general business model framework illustrated with a case on Norwegian marine technology company Sea-Hawk Navigation AS

Abstract

The fields of business models and business model innovation are relatively new as research topics, and largely unexplored in academia. Still, the study of business models has perhaps never been more important than it is today. With this paper, we seek to contribute to the further development of business model theory. In order to do so, we employ a twofold approach that is part theoretical, and part practical. The theoretical part contains an elaborate literature review of four central contributions to the field, and our development of a conceptual, general business model framework. The framework we provide represents an amalgamation of the aforementioned four, reviewed contributions, and is furthermore explicitly connected to several key theories from the field of strategy. The practical part of our paper is an illustrative, qualitative case study on Norwegian marine technology company Sea-Hawk Navigation AS (Sea-Hawk). Sea-Hawk is a firm with close bonds to the oil industry, and is currently going through difficult times due to a drastic, seemingly lasting fall in oil prices. The need for innovation and restructuring in oil-tied companies and industries appears more pressing than ever, and therefore, Sea-Hawk provides an especially interesting case for the exemplification and testing of our theoretical business model framework. We find that, despite having clear limitations, our model was relatively successful in describing, categorizing and clarifying a range of components in Sea-Hawk’s business model that seemed to matter. Our model was additionally able to provide the foundation for several recommendations that might be helpful for the firm. In this regard, we mention that largely, Sea-Hawk’s business model appears to be sensible, sound and consistent. Except for certain, rather minor areas of possible improvement, the deterioration of Sea-Hawk’s main market, rather than their business model itself, appears to be the primary reason for the difficulties that the firm currently experiences. One main recommendation for Sea-Hawk is consequently that the firm from now on should seek to leverage their business model in industries other than seismic services for oil and gas. The firm itself has identified e.g. fishing vessels, rescue, and cruise and ferries as promising, prospect markets. In these markets, we believe that Sea-Hawk’s business model to a large extent could work, and be a means through which the firm can gain traction.We hope that our framework could assist a business model designer in mapping and understanding his business model, and in providing an overview of the toolbox of variables available to him for business model innovation. Moreover, we hope that our framework can serve as a basis for future research, of both practical and theoretical nature.