Abstract: The competition among enterprises is not between products, but also between business models. Business model is an important source of competitive advantage. The research about business model innovation has attracted the great attention of both domestic and international academic scholars, but their researches focus mainly on the characteristics and evolution of business model innovation, as well as the systematic structure of business model innovation. There are following gaps in previous researches on business model innovation: (1) Not considering the special situation in China; (2) In the research of business model innovation, more considerations were focused on the value-added of users or "three win effect" (referring to consumption, businesses partners and the company itself), while less consideration was to "multi-win effect" (considering other third party and more parties outside the original business system). Based on the literature review, this paper firstly cites the definition of business model as a business activity system that changes the value of an enterprise through the value-added process of users and the effects of "multi-win effect". Then, from the horizontal and vertical perspectives of China′s development, this paper respectively chooses the human relationship society and the government′s systems and policies in a specific period of time, focusing on the six aspects of situation, competition environment, internal environment, value proposition, business system and profit model, to construct the situational application model (SAM) of business model based on the iceberg theory.This paper choose Suzhou L.vending Intelligence IOT Technology Co., Ltd. (hereinafter referred to as "L.vending Intelligence") as the research object to explore the business model innovation SAM model based on the unique situation in China. First of all, it compares two business models of L.vending Intelligence applied, namely, traditional business model and innovative business model; Second, we analyze the two business models by using the iceberg theory from five perspectives: competitive environment, internal environment, value proposition, business system and profit model; Third, we use the business model innovation SAM model to further explore the business model innovation of L.vending Intelligence. The research shows that the success of L.vending Intelligence is based on the situation of relationship society and the national policy of "mass entrepreneurship and innovation". The findings of this paperare as follows:(1) The business model innovation of an enterprise cannot be separated from a specific situation, which is the source of business model innovation.(2) When an enterprise innovates its business model, it needs to consider the application of situation for the business and the process design based on the changes of competition environment and internal environment.(3) Business model innovation needs to be expanded the original stakeholders, but at the same time it should break through the original value proposition to achieve "multi-win effect".The SAM model of business model innovation introduced in this paper is not only the supplement and improvement of the existing business model innovation, but also the expansion of the iceberg theory, which provides the experimental and theoretical support for China′s business model innovation.Finally, this paper gives the following management enlightenment from both enterprise and government perspectives: For enterprises: (1) Enterprises need to keep consciousness and motivation on business model innovation; (2) Situation is the key source of business model innovation, they need to seek for business model innovation based on Chinese situation; and (3) Enterprises can analyze six factors of SAM model to find the path of business model innovation.For government: (1) Create a good environment for business model innovation and encourage business model innovation based on Chinese situation; (2) Relevant systems or industrial policies should be timely issued to guide enterprises to achieve business model innovation based on the requirements of economic development; and (3) To promote the theory and practice research of business model innovation in China. As the Chinese situation is different from the western countries, it isn′t unsuitable if we apply the theory of business model innovation and practice research based on the western situation for the Chinese enterprises according to the echo what the theory says, which is not conducive to the transformation, upgrading and innovation development of Chinese enterprises.

Key words: situation, business model innovation, iceberg theory, SAM model, case study