Business model innovation for sustainability: A system dynamics approach

Recently, sustainability has been gaining momentum both in research and practice. Firms aiming at sustainability purpose have to renew their entire Business Model (BM). Sustainable business model innovation refers to the redesign of the BM's components and the linkages between them to accommodate the adoption of sustainability-based strategies. Extant literature presents valuable contribution, initiating a debate on business model innovation for sustainability. The intersection between the sustainability literature and the business model one is mostly characterized by qualitative studies, highlighting a lack of quantitative research, which could contribute to shed light on the links among micro-dimensions underlying the business model innovation process. Specifically, few studies embrace a system thinking approach, considered appropriate for analyzing a complex and dynamic system such as business model. This study advances the current body of knowledge of business model innovation process for sustainability, by specifically leveraging on system dynamics method. The core mechanism of a sustainable business model is a reinforcing feedback loop between value offering to customers and value captured by the firm and the natural environment. Our study provides a conceptualization of business model innovation process for sustainability through a casual-loop diagram, showing the theoretical interlinks between the different components of the business model.