TY - JOUR
T1 - Managing the Transition to a Dual Business Model
T2 - Tradeoff, Paradox, and Routinized Practices
AU - Visnjic, I.
AU - Jovanovic, Marin
AU - Raisch, Sebastian
N1 - Funding Information:
Financial support from the Spanish Ministry of Science, Innovation, and Universities [Grant PGC2018-101022-A-100]; the Swiss National Science Foundation [Grant 185164]; and the European Union [Grant 856688] is gratefully acknowledged.
Publisher Copyright:
Copyright: © 2021 The Author(s)
PY - 2022/9
Y1 - 2022/9
N2 - Building on an in-depth study of a manufacturing company's shift from a product to a product-service business model, we explore how single-focus companies transition to a dual orientation. Although companies generally use highly sophisticated practices to manage a dual orientation, those that transition to one successfully start with less sophisticated practices. Early on, the use of simple tradeoff practices, which maintain the product and service logics, helps single-focus companies explore the emergent tensions that their transition to a dual orientation causes. Conversely, adopting more sophisticated practices at this early stage overwhelms them. At a later stage, these companies' growing understanding of the tensions allows them to experiment with more comprehensive paradox practices that transcend the product and service logics. Conversely, maintaining simple practices at this stage prevents them from gaining the solution experience required to complete the transition. The evolutionary process culminates in sophisticated routinized practices that institutionalize recurrent tensions' solution, while allowing for further experimentation to deal with new tensions. The different practices' appropriate sequence and pacing during the evolutionary process facilitate companies' transition to a dual orientation.
AB - Building on an in-depth study of a manufacturing company's shift from a product to a product-service business model, we explore how single-focus companies transition to a dual orientation. Although companies generally use highly sophisticated practices to manage a dual orientation, those that transition to one successfully start with less sophisticated practices. Early on, the use of simple tradeoff practices, which maintain the product and service logics, helps single-focus companies explore the emergent tensions that their transition to a dual orientation causes. Conversely, adopting more sophisticated practices at this early stage overwhelms them. At a later stage, these companies' growing understanding of the tensions allows them to experiment with more comprehensive paradox practices that transcend the product and service logics. Conversely, maintaining simple practices at this stage prevents them from gaining the solution experience required to complete the transition. The evolutionary process culminates in sophisticated routinized practices that institutionalize recurrent tensions' solution, while allowing for further experimentation to deal with new tensions. The different practices' appropriate sequence and pacing during the evolutionary process facilitate companies' transition to a dual orientation.
KW - business model
KW - hybridity
KW - organizational routines
KW - paradox
KW - process
KW - tension
UR - http://www.scopus.com/inward/record.url?scp=85141233882&partnerID=8YFLogxK
U2 - 10.1287/ORSC.2021.1519
DO - 10.1287/ORSC.2021.1519
M3 - Article
AN - SCOPUS:85141233882
SN - 1047-7039
VL - 33
SP - 1964
EP - 1989
JO - Organization Science
JF - Organization Science
IS - 5
ER -