Proactive market orientation and business model innovation to attain superior new smart connected products performance

Abstract

Purpose Smart connected products (SCP) are the new archetype of products evolving. SCP are subtly changing the product-centric business to system-centric. Development and monetization of new SCP is an uphill task, it necessitates unique market orientation and business models. The purpose of this study is to establish a framework of variables influencing new smart connected products performance (NSCPP) at the market place, suggest methods to operationalize the framework. Design/methodology/approach The study identified key variables influencing NSCPP from existing literature. Conceptualized unique theoretical frameworks of these variables and empirically validated structural relationships. The study performed structural equation modeling using the data collected from 163 respondents having managed the development and monetization of 138 new SCP launches. Findings The study established structural relationships among selected variables proactive market orientation (ProMO), new product development proficiency (NPDPro) and business model innovation (BMoI). It revealed that the effect of ProMO is manifested through NPDPro. BMoI and NPDPro significantly influence NSCPP. Practical implications The study presented “ProMO Canvas” to plan and operationalize ProMO integrated with new product development (NPD) stage-gate activities. The study suggested the practitioners to execute ProMO activities preceding NPD activities and execute NPD, business model development activities in parallel to attain superior NSCPP. Originality/value This study is a novel effort to derive a unique empirical framework of variables ProMO, NPDPro and BMoI to attain superior NSCPP.