Designing Business Models of Tomorrow : Exploring the Expansion of Cleantech-as-a-Service through an Agile approach

Abstract: Background: Three mega trends are profoundly changing today’s market dynamics; climate change, digitalization, and globalization. The increasing interconnectivity and omnipresence of digital technologies are blurring the boundaries of the physical and virtual reality, implying a shift in how digital companies create value and internationalize. Also, new policies and higher customer demand in greener and smarter technologies have created new opportunities for value creation to develop cleaner technologies that foster the growth of clean-technology firms. To be competitive and persist in a sustainable and digital economy, firms must be able to cope with changing market conditions. Strategic agility can support to avoid rigidity and benefit from change, which is fostered by strong dynamic capabilities. Knowledge gaps: The study aims to address shortcomings of digital sustainability business models and specifically characterize the emerging sector of sustainable software companies offering Cleantech-as-a-Service applications. The international potential of these ventures recognizes the need to elaborate on internationalization drivers. The globally competitive environment enforces the need to be strategically agile, whereby applying agile principles to an international context can bring a comprehensive view of internationalizing digital sustainability ventures’ critical capabilities and business model characteristics. The study will also assert the role of collaborative ecosystems in an entrepreneurial internationalization. Purpose: This study will explore the emergence of Cleantech-as-a-Service and investigate how these digital entrepreneurs achieve strategic agility in global pivoting and competitive environments. Our exploratory research aims to apply agile principles to entrepreneurial internationalization strategies, where we through six in-depth interviews will discover the role of digital cleantech firms’ dynamic business models, capabilities, and ecosystems when entering a foreign market. Theoretical framework: The conceptual frame of references is based on two major sections where the first considers the context of digital and sustainable firms and exhibits the essences of digital and sustainable business model designs and how to sustain competitiveness through the interrelation of dynamic capabilities and strategic agility. In the second section the study brings forward theory supporting the exploration of an agile internationalization for digital firms, such as virtual markets and ecosystems. The key theoretical forthcomings are summarized into a conceptual framework that combines the role and interplay of entrepreneurs, business models, as well as networks and ecosystems on the basis of strategic agility and dynamic capabilities, that jointly foster an agile and virtual internationalization. Methodology: The interpretive research used an explorative and abductive approach to perform a qualitative multiple case design. The empirical study was based on six Cleantech-as-a-Service companies where in-depth semi-structured interviews were conducted with the informants of significant positions. The thematic and content data analysis supported the identification of common patterns and themes through coding which guided the subsequent analysis chapter. Findings: Our study revealed characteristics and success factors of Cleantech-as-a-Service ventures operating on global volatile markets, which adopt a leagile approach. The findings supported a definition of the concept but also identified the dynamic capabilities and flexible business models leveraged to sustain international competitive agility. The key agile capabilities relate to networking, experimenting, and learning whereas business model characteristics confer resiliency, interdependency, and efficiency.