Pathways to digital business models: The connection of sensing and seizing in business model innovation

Abstract

Digital business model innovation (BMI) is critical to achieving and sustaining competitiveness in technology-driven environments. In those environments, firms must not only sense changes to identify opportunities but also effectively seize them in BMI. Therefore, sensing and seizing cannot be considered as isolated dynamic capabilities, but must be combined for successful BMI. However, research on sensing and seizing does not offer compelling suggestions for firms that struggle with connecting both while pursuing digital BMI. We use qualitative configurational analysis (QCA) to analyze a sample of 49 case studies on digital BMI to identify the antecedents that firms sense before seizing these changes with digital BMI. Based on ten configurations of sensing (represented by six antecedents) and seizing (represented by four BMI types), we explain the relationship between sensed antecedents and seized digital BMI. In addition, we derived four variables that explain “what” and “how” firms connect sensing and seizing. Based on the sensing-seizing connection, we introduce consolidating BMI as a new type of BMI unique to the digital context. This novel type enables firms to exploit and explore new BMs and subsequent digital BMIs through the means of digital infrastructure. This study extends the understanding of how different business models emerge and how firms create digital BMIs.