Business Model Innovation through Trial and Error learning

Question 1

What is the sustainability of a BM?

Answer 1

It can be very unclear due to changing market conditions.

Question 2

Why is collective knowledge important for the firm?

Answer 2

If the firm’s knowledge is recent and adapted enough to face environmental uncertainties then the company can survive.

Question 3

Trial and error

Answer 3

Retaining actions, which produce favourable results and discarding those who do not

Question 4

Organizational search

Answer 4

Trying actions and correcting and adjusting them during testing leads to learning.

Question 5

Two factors seem to play a role in trial and error experiments:

Answer 5

• Established firms usually start experimenting as a reaction to difficulties
• The cost should be small enough for the shareholders and management to approve

Question 6

What are the main stages of BMA?

Answer 6

Stage 1: Exploration
Stage 2: Exploration – Business Model Development
Stage 3: Exploitation – Scaling up the refined business model
Stage 4: Exploitation and further exploration

Question 7

How is BM development seen?

Answer 7

an initial experiment followed by constant fine tuning based on trial-and-error