A TIME TO RISK, A TIME TO PLAY IT SAFE: HOW TOP MANAGERS NAVIGATE BUSINESS MODEL INNOVATION

Business model innovation (BMI) is a critical mechanism for achieving competitive advantage, yet the cognitive factors shaping executives’ decisions to pursue it remain underexplored. We examine how perceived opportunities and threats, prior BMI experience, and temporal orientation influence BMI. Drawing on a behavioral experiment with 400 senior executives from Forbes 2000 firms, we find that perceived threats and prior failures reduce the likelihood of pursuing BMI. Temporal orientation moderates these effects: past-focused top managers are less likely to pursue BMI after failure, whereas a future orientation mitigates this effect. These findings extend behavioral theory of the firm and threat rigidity theory by incorporating temporal cognition as a key antecedent of strategic decision-making and offers insights into how executives evaluate BMI under risk and uncertainty.