The Influence of Business Model Changes on Competitive Advantage: A Case Study among Start-ups:

Abstract: Purpose - The purpose of this paper is to explore and to explain how changes in business models, as reflected in business model ontologies, influence the competitive advantages of firms. Design/methodology/approach - Drawing on the resource-based view, we build upon an intra-organizational perspective of competitive advantage. Six Internet start-ups in Stockholm and the Silicon Valley were analysed using a multiple-case design with single-units of analysis.Findings - Changes in business model alter the competitive advantage through changes in resources and capabilities. Further, four types of changes have been identified that explain how competitive advantages are sustained.Practical implications - A retrospective analysis, as conducted, can be insightful for practitioners to understand how the competitive advantage of their firm changed. A forward-looking analysis can be useful to understand which business model changes are necessary to sustain a competitive advantage.Originality/value - The paper contributes to the idea of business models as useful units of analysis and the research stream of competitive advantage. We offer a new perspective by showing how changes in the resources and capabilities inherent to the business model result in changes in the competitive advantage.