Barriers to Business Model Innovation: Insights from SMEs in Switzerland

Abstract

Business model innovation (BMI) has become increasingly important in recent years, but the question remains as to why only a small number of companies are doing it. In addition, the rate of companies innovating in general is decreasing in Switzerland, especially among small and medium-sized enterprises (SME). Therefore, the aim of this study was to investigate the barriers to business model innovation among small and medium-sized enterprises in Switzerland. A quantitative approach with a written survey sent to 4000 companies was adopted. A sample of 405 company managers from the Swiss canton of Schwyz responded. The data were statistically analysed using SPSS.The results show that medium-sized companies and those in high-tech sectors are more likely to engage in business model innovation. In contrast, smaller companies and those in less technical sectors face more challenges. The analysis identified seven barriers to BMI that are significant. Two barriers turned out to be triggers for BMI rather than actual obstacles. Past barriers were more intrinsic, related to diversity, risk aversion and own expertise. For current BMI plans, the most relevant barriers are more likely to be related to cost, technology and capacity. Additionally, the relevance of BMI may increase as companies focus on data and digital business models. These findings can assist companies in identifying and overcoming barriers in the innovation process. Furthermore, organisations such as economic development agencies or higher education institutions can adapt their services to better support SMEs in overcoming these barriers and fostering innovation.