Designing Service Business Models for the Internet of Things: Aspects from Manufacturing Firms

The increasing pervasiveness of the Internet of Things (IoT) has offered a wealth of business model opportunities. Many conventional product-based companies are seeking to increase their competitiveness by moving toward a service-based business model where IoT can bring tremendous opportunities. These traditional product-sales manufacturing firms are required to look at business models beyond their conventional product-focused, firm-centric core competence business model innovation and respond to fast changing digitalization dynamics focused on promoting service-centric solution availability instead of physical products. However, studies and literatures have not yet provided profound and actionable approaches to service business models in IoT-driven environments for manufacturing firms. This research aims to fill the gap and elaborate the guiding principle for designing service business models for the Internet of Things in manufacturing firms. The guiding principles are derived from illustration of value of the Internet of Things and systemic review of academic literatures focusing on IoT business models. Exemplary real-world IoT service business models cases are demonstrating the applicability of the proposed guiding principles. Evaluation of the applicability of guiding principles pertaining to the emerging context of IoT business model can enable researchers and practitioners to visualize and analyze service business model design in a structured and actionable way.