Value capture in IoT-driven business models: considerations about smart resources and isolating mechanisms in networked environments

Purpose-This conceptual paper aims to contribute to a better understanding of value creation and value capture with smart resources in the Internet of Things (IoT)-driven business models against the backdrop of an increasingly networked and connectivity-based environment. More specifically, the authors screen strategic management theories and adapt them to the specificities of new types of smart resources by focusing on a conceptual analysis of isolating mechanisms that enable value creation and value capture based upon different types of smart resources. Design/methodology/approach-By adapting the state of the art of the contemporary resource-based discussion (resource-based view, dynamic capabilities view, relational view, resource-based view for a networked environment) to the context of IoT-driven business models, the paper typifies valuable intra- and inter-organisational resource types. In the next step, a discursive discussion on the evolution of isolating mechanisms, which are assumed to enable the translation of value creation into value appropriation, adapts the resource-based view for a networked environment to the context of IoT-driven business models. Findings-The authors find that connectivity shapes both opportunities and challenges for firms, e.g. focal firms, in such business models, but it is notably social techniques that help to generate connectivity and transform inter-organisational ties into effective isolating mechanisms. Originality/value-This paper lays a foundation for a theoretically underpinned understanding of how IoT can be exploited through designing economically sustainable business models. In this paper, research propositions are established as a point of departure for future research that applies strategic management theories to better understand business models that work with the digitisation and connectivity of resources on different levels.