Business model portfolio configurations and firm performance

Over the last years, the business model (BM) concept has attracted massive attention of researchers and practitioners. This is especially due to the progress of digitization and the success of start-ups threatening BMs of various incumbents. Incumbent firms typically operate a portfolio of BMs. The BMs in a firm’s portfolio often share resources or generate other forms of synergies. However, an incumbent’s BMs might also create conflicts that eventually lead to negative performance effects. Still, empirical studies in this context are rare, especially when it comes to the evaluation of the impact of different BM portfolio configurations on firm performance (e.g. Aversa et al., 2015). This is because of a lack of longitudinal empirical settings, the absence of valid measurements and high environmental complexity (Taeuscher, 2018).

To overcome these issues, we propose a “sandbox” approach in the airline industry. Over the last decades various airline carriers have operated with distinct sets of (well-defined) BMs (e.g. full service, no-frills, cargo etc.) resulting in different levels of performance. At the same time, (most) firms in the airline industry have focused on BMs in a single industry sector (transportation by air), which allows for studying BM portfolio configurations and their impact on firm performance in a rather homogenous empirical set-up.