Business model innovation in traversing developed and emerging economies: An integrated systematic literature review

Business model innovation (BMI) is a complex phenomenon, made even more so in the international landscape involving emerging economies. The environment often afforded to firms traversing developed and emerging economies means that BMI is not an end to itself but a regular process involving changes to business models. This paper departs from the usual entity-based ontology of BMI to a more process-based ontology that highlights the nuances of innovation in and with business models as the role of business model innovation in a bifurcated world of developed and emerging economies is addressed. In doing so, we undertake an integrated systematic literature review using the Context-Intervention-Mechanism-Outcomes method to analyze 72 research articles between 2003 and 2024. Using storytelling to present the findings, the narrative initially starts with context of firms, usually from developed economies, that are venturing overseas employing multiple business models, to seek opportunities. The midpoint (i.e., intervention and mechanisms) of the story contains rich and nuanced developments involving firm capabilities and knowledge management initiatives in addressing emerging economy innovation and reverse innovation. The findings culminate with varying forms of BMI as outcomes. This work contributes to the research on business models by showing that the concept is more nuanced, as notions of innovation-enabling business models and business model reinnovation are explored. In addition, this work highlights the traversing between the bifurcated worlds of developed and emerging economies as a boundary condition of business model reinnovation. Finally, using the profiting-from-innovation as a lens, we highlight how business models are deployed in emerging economies as orchestrative mechanisms that enhances firms’ ability to profit from their innovations. We offer a mechanism-based perspective of business models that enable firms to reflexively identify and integrate dominant designs of emerging product innovations, its complementary assets and optimise appropriation regimes.