relationship between business model innovation and productivity following the adoption of digital technologies

On the search for value, many manufacturing firms have undertaken significant financial efforts in order to digitalise their value chains. This paradigm of an 'Industry 4.0' promises an unprecedented growth in productivity, a key figure, generally associated
with the competitiveness and profitability of companies. However, despite large investments, many manufacturing firms are currently facing a stagnation or even a decline of their productivity. This paradox development, widely known as the 'Productivity Paradox', poses a large structural problem. It critically reduces the competitiveness and profitability of manufacturing firms which are standing under high economic pressure
in today's increasingly globalised markets. A comprehensive theory to explain and solve this paradox suggests that manufacturing firms often don't target and extract the full value of innovative digital technologies. Due to elaborate organisational processes, neglected market opportunity analyses and missing rewards they fit them often into already existing Business Models. Therefore, manufacturing firms achieve usually only
incremental product- or efficiency improvements. To exploit their full value throughout the value chain, however, it would be necessary to pair the new digital technologies with an adequate innovation of the underlying Business Model - the value capturing,
proposition and creation mechanisms of a company. Promising support for this theory can be found in different literature streams. Nonetheless, although the attention for Business Model Innovation and their role in the digitalisation of firms is growing quickly, the theory has so far not been corroborated empirically. A large fraction of the connections between Business Model Innovations and their value enhancing capabilities in the context of digital technology remain unexplored. This research gap leaves scholars as well as practitioners clueless about why
the digital transformation of European manufacturers is failing on such a large scale. Resembling a 'call to action', the purpose of this dissertation is to tackle this important research gap. As part of my management and engineering master theses with Prof.Leifer in Stanford and Dr. Velu in Cambridge I have already been gathering knowledge in this field, analysing different aspects of Business Model Innovations and their value
enhancing capabilities of digital technologies over the last 12 months. The results show that there is in fact a significant connection between Business Model Innovation and productivity growth in the automotive manufacturing sector. However, despite this very
promising finding the study also revealed that a large fraction of root causes and conclusive connections still lack theoretical underpinning and empirical analysis in order to confirm that Business Model Innovations are a solution to the productivity paradox. Thus, the purpose of this PhD is to contribute to the management research- and digital transformation literature in order to fill this research gap while meeting the high demand of executive managers and practitioners for frameworks, tools and answers which could help to solve the productivity crisis.