Evaluation of Business Model Innovation towards Industry 4.0 via Cross-industry

Abstract

Innovation is one of the key drivers of growth, development, and profitability, which increases competitive advantages and has recently been moving towards industry 4.0 technologically. This motivates companies to update their business models (BM) towards industry 4.0. Moreover, there is a technique with the primary characteristics for achieving this motivation called "cross-industry innovation". Cross-industry innovation is a new method of innovation that concerns the creative translation and imitation of existing solutions from other industries for responding to the needs of the current market, sectors, areas, or domains. The challenge is to find out how far managers can rely on that to innovate their BM towards Industry 4.0. The aim of this study was to investigate the application of cross-industry innovation for designing industry 4.0 BM and explore the extent to which companies can rely on it as it has not been used for this purpose previously. This study utilized a database analysis to compare cross-industry innovation practices with industry 4.0 BM's characteristics in terms of value proposition, value creation, and value capture levels. In addition, some interviews were conducted with companies that had previously implemented cross-industry innovation to validate and generalize the results. The results indicated that cross-industry innovation practices can better fulfill flexible and dynamic networks, connected information flows, high efficiency, high scalability, and high availability in terms of value creation as well as variabilization of prices and costs in terms of value capture. Therefore, it demonstrated that cross-industry innovation was a more dependable and applicable strategy for designing the BM of Industry 4.0 than current practices.