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Light the way for smart cities: Lessons from Philips Lighting

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  • Brock, Kati
  • den Ouden, Elke
  • van der Klauw, Kees
  • Podoynitsyna, Ksenia
  • Langerak, Fred

Abstract

Smart cities are one of the dominant manifestations of digitization with a multimillion dollar potential, where cities and companies alike are looking for ways to create and capture value. Technology-driven companies are key to making smart cities a reality, but their current product-centric business models do not meet the changing needs anymore. Based on an in-depth study at Philips Lighting of four smart city cases across a period of five years, our article illustrates four distinct business models that enable incumbent organizations to enter this smart city market. We develop and contrast the four types of business models on individual and joint value creation and value capture dimensions and show how each business model can be of value to an incumbent, depending on the project and ecosystem. We illustrate these business models with insights from Philips Lighting's transition from public lighting to smart cities and provide specific implementation suggestions for incumbent companies.

Suggested Citation

  • Brock, Kati & den Ouden, Elke & van der Klauw, Kees & Podoynitsyna, Ksenia & Langerak, Fred, 2019. "Light the way for smart cities: Lessons from Philips Lighting," Technological Forecasting and Social Change, Elsevier, vol. 142(C), pages 194-209.
    • Handle: RePEc:eee:tefoso:v:142:y:2019:i:c:p:194-209
    DOI: 10.1016/j.techfore.2018.07.021
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    3. Bencsik, Barbara & Palmié, Maximilian & Parida, Vinit & Wincent, Joakim & Gassmann, Oliver, 2023. "Business models for digital sustainability: Framework, microfoundations of value capture, and empirical evidence from 130 smart city services," Journal of Business Research, Elsevier, vol. 160(C).
    4. Andrea Ciacci & Enrico Ivaldi & Reyes González-Relaño, 2021. "A Partially Non-Compensatory Method to Measure the Smart and Sustainable Level of Italian Municipalities," Sustainability, MDPI, vol. 13(1), pages 1-24, January.
    5. Baogui Xin & Yongmei Qu, 2019. "Effects of Smart City Policies on Green Total Factor Productivity: Evidence from a Quasi-Natural Experiment in China," IJERPH, MDPI, vol. 16(13), pages 1-15, July.
    6. Michelangelo Scorpio & Roberta Laffi & Massimiliano Masullo & Giovanni Ciampi & Antonio Rosato & Luigi Maffei & Sergio Sibilio, 2020. "Virtual Reality for Smart Urban Lighting Design: Review, Applications and Opportunities," Energies, MDPI, vol. 13(15), pages 1-26, July.
    7. Linde, Lina & Sjödin, David & Parida, Vinit & Wincent, Joakim, 2021. "Dynamic capabilities for ecosystem orchestrationA capability-based framework for smart city innovation initiatives," Technological Forecasting and Social Change, Elsevier, vol. 166(C).
    8. Ancillai, Chiara & Sabatini, Andrea & Gatti, Marco & Perna, Andrea, 2023. "Digital technology and business model innovation: A systematic literature review and future research agenda," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    9. Kummitha, Rama Krishna Reddy, 2020. "Why distance matters: The relatedness between technology development and its appropriation in smart cities," Technological Forecasting and Social Change, Elsevier, vol. 157(C).
    10. Ivana Rakonjac & Ana Zorić & Ivan Rakonjac & Jelena Milošević & Jelena Marić & Danilo Furundžić, 2022. "Increasing the Livability of Open Public Spaces during Nighttime: The Importance of Lighting in Waterfront Areas," Sustainability, MDPI, vol. 14(10), pages 1-25, May.
    11. Gabrielli do Livramento Gonçalves & Walter Leal Filho & Samara da Silva Neiva & André Borchardt Deggau & Manoela de Oliveira Veras & Flávio Ceci & Maurício Andrade de Lima & José Baltazar Salgueirinho, 2021. "The Impacts of the Fourth Industrial Revolution on Smart and Sustainable Cities," Sustainability, MDPI, vol. 13(13), pages 1-21, June.

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