Service innovation structure analysis for recognizing opportunities and difficulties of M2M businesses

•We propose an innovation structure analysis for M2M service businesses.•A novel model (SCAI model) is introduced to explain optimization and identification values as M2M business opportunities.•Difficulties for M2M businesses are classified using a fishbone diagram.•Opportunities and difficulties are structured as a map by backcasting from a future M2M infrastructure to discuss strategy.•A smart home case is used for explaining effectiveness of our proposed model.

With the popularization of high-speed and high-capacity communication infrastructure, Machine-to-Machine (M2M) communication has received significant attention. However, even though the related technologies have been actively investigated, creating new businesses based on M2M communication is not easy. This study proposes a service innovation structure that visualizes the opportunities and difficulties of M2M service businesses. In our proposal, opportunities are classified as two types of value proposition (optimization and identification values) using the Sharing-Connecting-Analyzing-Identifying (SCAI) model. In addition, difficulties are discussed using a fishbone diagram. The SCAI model pays particular attention to the identification value, which tends to be ignored in other models. Opportunities and difficulties are structured as a map according to backcasting from a desired future M2M infrastructure. The backcasting approach is effective to untangle the intertwined difficulties. Using this opportunity-difficulty map, we can discuss and model M2M service businesses more clearly and strategically by recognizing the opportunities and the difficulties with stakeholders. A smart home case is used for explaining the effectiveness of our proposed model.