Examining the Microfoundations for Digital Business Model Innovation of Developing Markets International New Ventures (2023)

In this article, we explore microfoundations for digital business model innovation. This is pertinent because little is known regarding how decision-makers manage the digitalization processes that require business model innovation. Building on dynamic capability and upper echelon theories, this article sheds light on the dynamic capability-driven antecedents of the digital business model innovation of developing market international new ventures (INVs). Using survey data from 145 Pakistani INV, the study reports that Internet capabilities (platform and web capabilities) positively influence digital business model innovation. The direct influences are mediated by strategic agility and moderated by the functional diversity of the top management team (TMT). The influence of strategic agility on the digital business innovation model is also positively moderated by TMT's functional diversity. The findings contribute to the nascent literature on antecedents for the digital business model innovation in an underexplored context of developing market INVs. Practical and policy related implications are also discussed.