Paper info

Business Models and Networks: Assets and Capabilities in Software Businesses

Mika Westerlund and Risto Rajala

The paper was published at the 20th IMP-conference in Copenhagen, Denmark in 2004.

In this study, we focus on the assets and capabilities of software companies from theperspectives of business models and value-creating networks. Prior to analyzing thekey assets and capabilities in connection with diverse business models, we review theliterature of related topics, including interorganizational exchange, strategic networksand capabilities. Then we present a classification scheme for distinguishing betweendifferent types of software business models. We classify software business models withtwo dimensions: the level of involvement in customer relationships and the level ofhomogeneity of offerings for multiple customers. In the empirical part of our research,we explore the key assets and capabilities, i.e. resources, in four different businessmodel types. Finally, on the basis of our data, we identify acquisition and developmentof these resources either internally or externally through networks. Our aim is to studyassets and capabilities in association with business models of software companies inorder to understand the development of resources in specific business contexts.