The value of system dynamics' diagrams for business model innovation
ISSN: 0025-1747
Article publication date: 25 August 2021
Issue publication date: 21 March 2022
Abstract
Purpose
System dynamics (SD) is emerging as a powerful approach to understand, analyse, simulate and predict complex and dynamic business processes. In particular, it is true in the process of business model innovation (BMI) and not only as a computational approach. Due to the visual and diagrammatic tools employed by SD, innovation managers overcome humans' mental limitations and improve knowledge management in the BMI. This paper discloses the value of SD's visual tools, i.e. causal loop diagrams and stock and flow diagrams, to contribute to the “Knowldege Visualization” research line, and promote the application of SD as a powerful approach to support decisions in BMI.
Design/methodology/approach
Given the explorative nature and the “how” question driving the research, the methodology involved is a single, holistic case study. In particular, the case is about a business model (BM) diversification, in which an information and communication technology service provider has added to its existing business model a new BM based on a digital multi-sided platform, for passengers transportation.
Findings
The diagrammatic tools of SD, that is causal loop diagrams and stock and flow diagrams, allowed entrepreneurs to overcome the complexity of the business parameters concurring in the design of the BM.
Originality/value
The value of this research is in the exploratory approach and in the originality of the perspective by which SD is analysed: the visual knowledge perspective.
Keywords
Acknowledgements
The research activity reported in this work is based on the project funded by POR CALABRIA FESR-FSE 2014-2020 “Moving+: dati in movimento” (CUP J28C17000300006).
Citation
Ammirato, S., Linzalone, R. and Felicetti, A.M. (2022), "The value of system dynamics' diagrams for business model innovation", Management Decision, Vol. 60 No. 4, pp. 1056-1075. https://doi.org/10.1108/MD-02-2021-0172
Publisher
:Emerald Publishing Limited
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