Searching for innovation: Product, process, and business model innovations and search behavior in established firms

Prior research indicates that search practices are an important part of the innovation process. But where established firms search for different innovation types is not clear. Drawing on knowledge based theory of innovation and using state-of-the-art statistical techniques (copula with Bayesian inference), we find that established firms predominantly rely on several external sources (broad external search) when introducing new business models, on internal and external sources with high intensity (deep search) when innovating processes, and on broad and deep external search when innovating products. We explain that broad external search is important for business model innovation (BMI) because increased exploration is needed when introducing new business models that rely on general rather than specialized technical or tacit business knowledge. We contribute to the innovation and business model literatures by nuancing the differences between innovation types (BMI, product, and process innovation) and the associated search behavior. It is important to consider these differences because they give us clues to understand how established firms can explore unfamiliar territories through BMI.