The Business Model Navigator, developed at the University of St. Gallen, is patented and used worldwide to integrate innovation into the practices of both large and small companies.
In the years when innovation is no longer just a metaphysical or abstract concept, used to embellish presentations and corporate reports, the critical questions arise: what does innovation truly mean?
How can innovation be organically implemented within a company? It is true that innovation is often a long and costly process, yet engaging with it is essential, as this force can undermine even the most solid competitive advantages.
A famous example is Kodak, among many others. Was the failure simply due to a wrong forecast of market trends? Perhaps, but the mistake was far more fundamental in the core market. At the time, the photography giant, despite being the first to patent the digital camera in the late 1970s and having formed an alliance with Microsoft, estimated in the late 1990s that digital cameras would account for only 5% of the market over the next decade, and therefore no special strategic actions were necessary. By 2009, however, 95% of the market had already shifted to digital, relegating analog to a mere 5% niche, ultimately leading to the bankruptcy of the Rochester-based giant in 2012.
“Kodak is by no means an isolated case; in fact, one could almost call it the rule. Another, perhaps even more current example, is the media sector, which today must navigate declining subscriptions, collapsing advertising revenues, and competition from the widespread availability of free information in the digital era. These factors combined have severely challenged the most traditional business models, particularly for local newspapers. Just consider the recent closure of Giornale del Popolo here in Lugano”, says Roberto Pezzoli, partner at Gruppo Multi, a firm with over forty years of experience in local consulting.
In this context, when the ability to innovate one’s business model increasingly becomes an essential competitive factor, the St. Gallen Business Model Navigator comes into play. “It is the result of over five years of research, systematically analyzing the most innovative business models of the past 25 years across more than 250 companies in various industries. This made it possible to identify 55 models, which, when recombined, form the basis of the strategy for 90% of the world’s most successful companies”, continues Pezzoli, active in Lugano.
The model is the result of a perfect collaboration between the real economy and academia, two inseparable and interdependent dimensions.
Structured from analyses conducted by academics, the model was created directly by professionals active in the business world. The choice of BMI Lab, a spin-off of the Technology Management Institute at the University of St. Gallen, as a strategic partner, “was primarily driven by its unmatched expertise, extensive experience, and close ties to the University, whose outstanding ranking in all major international lists undoubtedly facilitated the rapid dissemination of the model”, emphasizes Pezzoli.
At the core of it all is the Business Model Navigator, the book written by Professor Oliver Gassmann, director of the Technology Management Institute, Professor Karolin Frankenberger, and Michaela Csik. Translated into 11 languages and with over 60,000 copies sold, it has established itself as one of the key reference texts on business model innovation.
“For Gruppo Multi, it all began after the CAS in Business Model Innovation that I attended at the Universities of St. Gallen and Stanford. These topics know no boundaries, and even in Ticino, more and more companies are confronting issues related to the relevance of their own business models”, continues the manager. “It is mistaken to think that innovation belongs only to large companies, and therefore does not concern SMEs, the true lifeblood of the Swiss economy, as well as of other European countries”.
The effectiveness of the model has also been confirmed by two key factors. First, by the rapid development of BMI Lab, founded by Gassmann and Frankenberger, which quickly established a presence in Switzerland, Germany, the United Kingdom, and Japan, consolidating its working method through years of collaboration with numerous companies, and becoming one of the leading experts in this area of strategic consulting.
Second, by numerous documented success stories: the new home laundry service recently developed by the Migros Group is just one example of the innovation pathway implemented by BMI Lab.
The magic triangle of Gassmann and Frankenberger, founders of BMI Lab.