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Digitalization Paradox

Digitalization triggers manifold growth opportunities. But despite the fact that product companies invest into digital technologies, they often fail to earn the expected benefits. This digital paradox is caused by insufficient modifications in the business models necessary for converting digital technologies into growth opportunities. By studying 52 companies, we make following contributions. We take a dynamic perspective on business models to identify five growth paths, namely, digital elements, connectivity, product as a service, customer process analytic, and digital platforms. For each growth path, we highlight the different steps and the necessary modifications in the business model components (e.g. value proposition, value-creation activities, and profit equation) in each of these steps. These growth paths inform a framework, which links growth paths with the two-by-two opportunity matrix and highlights the progress from gaining momentum to managing a portfolio of digital business models.

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Heiko Gebauer
Heiko GebauerProf. Dr.
Claudio Lamprecht
Claudio LamprechtResearcher