THE OPEN BUSINESS MODEL IN A DYNAMIC BUSINESS ENVIRONMENT: A LITERATURE REVIEW

The open business model is the integration of open innovation with a business model. It is an important bridging construct between innovation and organisational performance in public and private organisation environments. The open business model is characterised by consistent change in the pursuit of competitiveness. Organisations’ inability to navigate environmental changes and challenges successfully, or their complacency about doing so, are major issues that have proved costly or lifethreatening for many firms. Organisations constantly face two issues: competitiveness, and changes in the business environment. The literature points to numerous contentions about the open business model construct, about which the professional and academic fraternities have not yet reached a conclusion. Interestingly, there is near-homogeneity in the findings that business models are naturally stable and that, therefore, the open business model requires conscious effort and ingenuity to adopt. The open business model is a rising construct of public and private organisation environments, arousing interest and raising a plethora of questions from multiple groups.


INTRODUCTION
South Africa considers innovation to be an important catalyst in the economy, and National Treasury has budgeted R13.6 billion over the medium term [1], with R1 billion set aside in 2018/19 for innovation-oriented activities [2].This is predominantly distributed through public sector-driven initiatives, some of which are partner-oriented.The extensive participation in in-licensing -for example, in enterprise resource planning (ERP) systems such as the Systems, Applications and Products (SAP) suite, and numerous public-private partnerships such as the Cisco Networking Academy -is only one of the many tools with which public sector organisations have harnessed and created value from open innovation.
Research still struggles to provide a unified and generally accepted definition of the open business model concept [3].Different domains, therefore, have used and developed the concept independently in silos [4].Based on the definition of the business model proposed by A. Osterwalder&Y.Pigneur [5], the open business model in this study is defined as a construct that transcends organisational boundaries and defines the rationale of how that organisation creates, delivers, and captures value.We posit that the open business model still seeks to achieve the same objectives as the business model, although external parties are explicitly involved.These parties are collectively referred to as the business ecosystem.
Research on open business models is still very new, and researchers have primarily focused on the benefits of open business models [6][7][8], developing typologies [9][10][11], identifying challenges associated with implementing open business models [12], and the link to performance [13].However, despite the undoubted relevance of openness and collaboration in today's networked economy, the majority of existing business model research is firm-centric [14,15] and the aspects and effects of openness are not sufficiently understood [11].

METHODOLOGY
In this study, a systematic literature review has been employed because it is replicable and transparent [16].It is also unbiased and comprehensive [17], trustworthy, rigorous and auditable [18], and provides a coherent overview [19].The systematic literature review also gives a theoretical grounding for envisaged further exploration, and allows the development of a framework or model.

Search strategy
Three databases -the ISI Web of Science, EBSCOhost, and Scopus -were chosen for the literature search.The ISI Web of Science's Social Sciences Citation Index (SSCI) database was chosen due to its status as one of the most comprehensive databases of peer-reviewed journals in the social sciences [20].Furthermore, it is known to employ strict inclusion evaluation processes [21].The EBSCOhost database was chosen because it is among the largest and most comprehensive databases for business-oriented scholarly full-text journals compared with other popular databases [22].Scopus was chosen due to its immense popularity alongside the ISI Web of Science, with some studies, such as that of Falagas, Pitsouni, Malietzis and Pappas [e.g.23] rating it the largest searchable citation and abstract source for literature.Scopus and the ISI Web of Science are two of the most extensive databases [24].
Questions around Google Scholar's transparency, precision, consistency, and completeness as a scientific resource informed the choice to use it as a supplement for retrieval rather than as a primary literature source [25,26].
Following in the footsteps of S. Schneider&P.Spieth [27], we adopted the three-stage process for systematic literature reviews suggested by D. Tranfield, D. Denyer&P.Smart [28].We identified our research objective and then designed our literature review process.This was followed by the review process itself, and a report on the review.

Study selection
The first phase of the electronic database search selected articles that were published between 2002 and April 2017.The search used the key phrases 'open innovation', 'business model', and 'open business model'.The second phase eliminated articles that did not meet the inclusion criteria, such as the key phrase, the category or domain area of the study, and the publication and document type.It was critical that each article be vetted against relevant inclusion criteria in order to maintain the validity and reliability of the review [29].Further elimination was based on the methodological screening template (see Table 1).These selection criteria were similar to criteria followed by L. Pittaway, M. Robertson, K. Munir, D. Denyer&A.Neely [30].One assumption of citation analysis is that authors cite their influences; so citations serve as surrogates for the influence of the cited work [31].Our elimination of papers with no citation (criterion γ) over three years is based on this understanding, with the interpretation that such papers have yet to influence the research field.

THEORETICAL BACKGROUND
We

Open innovation
Open innovation is best understood from the original definition as a paradigm that assumes that organisations can and should use external and internal ideas, as well as internal and external paths to market, as they look to advance their technology [33].The well-documented cases of open innovation champions in the USA, such as IBM and Procter and Gamble, have helped to catapult growing worldwide interest in this paradigm [34] (see Figure 2).  2 depicts open innovation practices as inbound or outbound, which denotes the direction of knowledge flow.Chesbrough [36] defines outside-in (or inbound) as knowledge sourced from outside the organisation for internal application, and inside-out (or outbound) as knowledge produced internally and released for external application.

Open innovation practice
Author(s)

Business model
While various authors have studied the business model construct, which provides valuable insights, there is currently no consensus about definitions and conceptual boundaries [60].There are broad understandings of the business model, such as "framework for making money" [61], a "blueprint for how to run a business" [5], and "the logic of the firm, the way it operates and how it creates value for its customers" [62].More comprehensive definitions are available in the literature.We prefer the ones of C. Baden-Fuller&M.S. Morgan [63], who describe how a firm organises itself to create and distribute value in a profitable manner, and A. Osterwalder&Y.Pigneur [5], who describe the rationale of how an organisation creates, delivers, and captures value.The business model of A. Osterwalder&Y.Pigneur [5] became the business model canvas (BMC) (see Figure 3).This is used by various large organisations, small and medium enterprises (SMEs), and potential entrepreneurs.B.W. Wirtz, A. Pistoia, S. Ullrich&V.Göttel [64] summarise previous definitions for business models by regarding the purpose of a business model's contents as leading to keeping the promise of service, the satisfaction of needs and profitability, and providing the assurance of a long-term competitive advantage.A deeper understanding of the purpose of the business model can be achieved by focusing on the elements.The BMC, arguably the most popular business model framework, was applied as the benchmark for comparing the business model elements mentioned in various sources (see Table 3).

Open business model conceptionan alternative view
One stream in the literature, represented by Davey .The scholars in the latter stream reiterate that the "openness to innovations and the openness of business models need to be adequately recognised, understood and treated as separate phenomena" [11].
M. Heikkila&J.Heikkila [76] noted that this difference appeared markedly between American and European scholars.The American school of thought mainly concentrated on classifying and using business models in a context of open innovation [77,78], while the European school has focused more on the ontologies and design methodologies of business models [5,79].Proponents of the former have had a larger share of coverage in the literature than the latter, for whom (including Weiblen [e.g.80]) the alternative view of an open business model is more attractive.[11] took a slightly different approach by looking at the implicit duality of openness: openness to innovations, and openness of business models.Either explicitly or implicitly, the universally accepted view is that the open business model is a way of connecting strategic decisions with value creation to customers (business or managerial strategy), through the mechanism employed to capture it (innovation strategy), and converting it to profit (financial or economic strategy).Some prominent scholars have called for open business model research to be diverted from the current line of argument (as noted between the American and the European schools of thought), and rather be viewed as a continuum of practices [e.g. 9, 58].

RESULTS AND DISCUSSION
Using the selection criteria described at the end of the methodology section, articles were imported into the EndNote reference management software, and quality checks -such as duplicate elimination and full-text search -were undertaken.Some 120 articles were then selected for review (see Table 4).See Table 5 below for the list of journals found to be most popular across the three domains, shown by the number of articles and their proportion of the total.It can be noted from Table 5 that five journals together accounted for over half of the total number of articles.A geographic perspective was also taken, which indicated that of the 120 articles identified, the largest number of authors came from the USA, followed by Germany and Spain.A number of countries were represented by only one author, while none of the articles reviewed had any author from Africa. Figure 4 depicts the number of articles reviewed in relation to the country of domicile of the author(s).The proportion of the number of articles per country relative to the total is also given as a percentage.

Figure 4: The number and proportion of articles by country of author domicile
As can be deduced from Figures 4 and 5, European countries had the largest representation in the articles reviewed.Asia was represented by five countries, each with between one and three articles.
No African country is represented in the review; but it is interesting to note that three of South Africa's partners in the association of five major emerging national economies: Brazil, Russia, India, China and South Africa (BRICS) are represented.The three are Brazil, China and India.

Figure 5: Proportion of articles by continent of the domicile of the author(s)
The review was further structured into the open business model's main functions and objectives, as well as elements of an archetype framework, as discussed in the next section.A crucial premise that underpins the discussion that follows is the inherent need for the adaptation and renewal that underlies the business model, which is often represented in a systemic form as a collection of elements and their underlying relations.Like any living system, these elements and their relations give business models their own life cycle [60].S.G.Winter&G.Szulanski [82] argue that "the formula or business model, far from being a quantum of information that is revealed in a flash, is typically a complex set of interdependent routines that is discovered, adjusted and fine-tuned by 'doing'".

The open business model as a bridging construct between innovation and organisational performance
One of the biggest challenges currently facing the open innovation community is proving the actual benefit of openness, especially due to a lack of value measurement instruments [56].Some companies pursue openness simply because it is a popular phenomenon at present, not because of forecast revenue streams.The (open) business model has the difficult responsibility of defining the mechanism for these revenue streams.
The literature noted multiple conflicts, with one prominent conflict in the link between dynamism and organisational success.The majority of the relevant studies found that successful organisations are dynamic in undertaking inbound and outbound, as well as short-and long-term, targets [83].
However, others such as Wei, Zhao and Zhang [85] argue against this notion.Some older studies also indicated their failure to link dynamism and firm performance [e.g.84].A similar contradiction is noted in studies that look at only one of the two dimensions, with the majority of studies finding that there is a positive relationship between inbound open innovation activities and innovation outcomes [e.g.85,86]; other studies [e.g.43,87] show that the effects of this relationship can also be negative.D.J. Teece [70]'s study [70], however, revealed that the business model and enterprise performance relationship are not entirely conclusive; rather, they are context-specific.D.J. Teece [70] found that a great business model does not necessarily lead to better enterprise performance.V. Van de Vrande, J.P.J. de Jong, W. Vanhaverbeke&M.de Rochemont [48] and U. Lichtenthaler [88] found that SMEs predominantly embark on openness to keep up with their competition or to avoid being pushed out of business.On the other hand, large corporations embark on openness to achieve an iron grip on markets.The literature has yet to show how the benefits map out in collaboration engagements.
The previous generation of strategy scholars argue that survival (a basic achievement that organisations seek before expecting to attain performance) depends on exercising strategic leadership; building dynamic core competencies through both in-house development and strategic partnerships; focusing on and developing human capital; effectively using technologies; and implementing new organisational structures and culture [89].Further exploration of these could establish precise mapping between innovation and performance.

Adaptation mechanisms related to environmental change
Openness is generally reflected as a feasible bridge for organisational performance and as an adaptation mechanism for organisations that face environmental change.These general benefits include numerous formal and informal, direct and indirect, planned and derived, and primary and secondary benefits.Despite these benefits and the general dichotomy in the literature, it is conceded that openness can be excessive and that there is a risk of alliance partners appropriating innovation output to other parties not intended by the focal organisation [90].Therefore, organisations seem to use formal contracts to organise their open innovation activities with specific partner organisations, rather than engaging in open disclosure [91].Whatever the need for it, the literature again shows that contracting may not be sufficient for the effective governance of open innovation projects, but that good social relations (non-contractual) may be invaluable [92].
B. Elvesaeter, A.J. Berre, H. de Man&M.S. Li [93] noted a movement towards a broader concept of value creation beyond economic value, which includes defining new measurements for success beyond economic performance.This movement predicts that enterprises of the future will be better off embracing the different perspectives of sustainability, as the environment continuously changes.Customer demands and regulations that target specific environmental and social practices that are undertaken by organisations will increasingly have economic consequences [93], as would advances in information and communication technologies [94], globalisation, reduced product lifecycles, increased customer demands for new and reliable products and services, and reduced barriers of entry for new competitors [95].

Elements of an archetype framework of the open business model
Multiple studies tend to recommend openness [e.g.42,74,96].However, there is no explicit directive about what managers have to deal with or how they should overcome the challenges brought about by openness.A strategic and operating management model, or rather a toolkit, is necessary.In more progressive organisations, business model change is not necessarily motivated by poor organisational performance, but can even occur while the organisation is thriving [97].Such proactiveness could anticipate a decline in performance, or offer foresight into better returns with a new configuration.The development of new organisational routines, such as evaluation procedures and metrics of performance [74], could be considered to be the foundation of business model archetypes.
Furthermore, the literature generally agrees that enterprises, when operating under uncertainty, should experiment with a range of business models [98].Through experimentation, the initial value proposition evolves into a viable business model by using a series of trial-and-error changes that are pursued along various dimensions [99].
An open business model archetype does not need to digress from existing knowledge.Only a new configuration of existing elements is necessary.Table 6 indicates the attributes that should be considered in an archetype framework of open business models.

CONCLUSIONS
The three main findings of this review are the following: 1. Open business model studies are almost exclusively American and European.Studies on or in Africa could not be detected using the selection criteria of this study.Most of the existing research in the field focuses on the potential benefits of openness rather than addressing the disadvantages.This could lead to a biased literature, as noted by L. Dahlander&D.M. Gann [58].
Based on numerous scholars' predictions of continuing environmental change, the entire economic paradigm for business may change in the long run, leading to a fundamental transformation of the understanding of, and approach to, business models.The usefulness of a business model can be measured when it has been implemented and the consequences of this implementation have been revealed (eventual success or failure).Assessment methods that allow the qualification of new theoretical business models before their implementation, in order to choose, configure, or define appropriate business models prior to application, are necessary.In fact, the lack of ex-ante assessment methods often turns business model selection into a purely intuitive choice that is not based on rational criteria.
conducted a review of the open business model construct and expanded it to include the basic constructs of a business model and open innovation to achieve completeness and finality.Our understanding of the open business model, as defined above, follows the work of H. Chesbrough [32].Furthermore, the components of open innovation and the business model ultimately define the components of the open business model.Thus the study and comprehension of these concepts are critical.An alternative view of the open business model's conception is also offered.Figure 1 is a simplified depiction of our understanding of the open business model.

Figure 1 :
Figure 1: Conception of the open business model

2 .
Scholars have not reached a conclusion about comprehending the conception of the open business model.Literature that is more recent challenges and antagonises older, more established literature.3.There is no archetype of the open business model.The requisite elements are known -the central one being value -but the need for competitiveness and the ever-changing business environment have made the open business model immensely relevant in this era.
, Brennan, Meenan and McAdam [e.g. 7, 73, 74], and others, closely links the open business model to openness about an organisation's research and development activities in relation to the open innovation paradigm defined by H.W. Chesbrough [33].This view subscribes to the centrality of open innovation in the open business model construct.The other stream does not necessarily see the open business model as requiring openness and collaboration to reside in (open) innovation activities [e.g.11, 12, 75]

Table 3 : Matching business model elements in the literature against the business model canvas
[81]opman[81]explicitly describe the open business model as a type of business model with a direct association with open innovation.A.B. Holm, F. Gunzel&J.P. Ulhoi