Innovations based on sustainable technologies have been widely considered as a remedy for addressing societal and environmental problems in many industries. However, the large-scale adoption of such innovations goes beyond technology and requires organizing the business in a way that drive industrial transformations across actors and system layers, such as market structures, institutional frames, consumer behavior, and business values. 

The aim of this dissertation is to understand how industrial firms organize for system change towards sustainability. The study is a compilation of two papers within the same research context: the development of sustainable technology in the construction industry. The overlapping unit of analysis for both papers is business model innovation. Paper I examines how industry firms combine and complement business models with different innovation types to accelerate sustainable technology. Paper II identifies how a change in the business model and value creation logic that occur on a firm level accelerate sustainable technology and shape the socio-technical system. Together, both papers help paint a more complete picture of the business model role in transitions towards sustainability. The theoretical frame of this dissertation spans several domains: business model, innovation management, and sustainability transitions. Building on a multi-disciplinary premise, the study takes into account the organizational and the systemic parts of the change process by linking the company perspective (business models) to the wider governance of sustainability transitions. 

The findings underline the importance of business models that combine production efficiency with higher customer engagement and more collective value creation for driving larger-scale transitions toward sustainability. Moreover, business models in combination with different innovation types, such as product, process and positioning, act together and complement each other to achieve high sustainability and business outcomes. 

Sustainability transitions are a significant challenge that requires established industries to adopt innovative ways of doing business. Research suggests that while this is possible through business model innovation (BMI), risk avoidance by regime actors and high levels of future uncertainty act as barriers to successful transitions. Specifically, we lack knowledge about how established companies innovate their business model (BM) to reduce uncertainty related to sustainability transitions. We explore the case of a large forest-based manufacturing company in the construction industry, Stora Enso. We find that, by pursuing transformative BMI and combining multiple value creation logics, a company can reduce different types of uncertainty while shaping its business ecosystem towards more sustainable opportunities. We show that the BM can serve as an organizational tool for collectively exploring new knowledge, reducing uncertainty and driving change in a business ecosystem.

Purpose Green innovation can promote both environmental sustainability and economic growth. However, its development and implementation can be complex due to the need to align innovation activities within and across companies. In this study, the authors examined how this complexity can be managed by analyzing how individual companies combine different innovation activities to develop green innovation, and how companies along the value chain align to implement these innovations. Design/methodology/approach The dataset comprises both interviews and a survey of senior executives from the Swedish wood construction industry. These data were first analyzed by using fuzzy set qualitative comparative analysis (fsQCA) to identify innovation activity configurations at the level of the individual company. The interviews were then analyzed to identify alignment mechanisms enabling the implementation of green innovation along the value chain. Findings At the company level, the authors found three innovation activity configurations with varying levels of complexity: (1) systemic innovation by proactive companies, (2) process innovation by reactive companies and (3) inaction by technology-independent companies. On the value chain level, the authors found three alignment mechanisms that facilitate the implementation of green innovation along the value chain. These mechanisms promote cooperation by increasing efficiency, opening up new market opportunities and increasing the level of servitization. Originality/value This paper analyzes the complexity of green innovation and provides novel insights into how complexity is managed at the level of both the individual company and the value chain.