W6: Kapoor (2018): Ecosystems: broadening the locus of value creation Flashcards
Study’s aim
The utilisation of the term “ecosystem” within business contexts has seen a surge, prompting questions about its conceptual underpinning, its differentiation from conventional value and supply chain, and the practical implications of ecosystem research. The study aims to introduce readers to the field of ecosystem research, offering insights into its novely and utility while addressing inquiries, challenges, and opportunities
Historical trajectory of “ecosystem”
Traced from its conceptual origin in social science to its integration into the lexicon of business strategy. Over time, various definitions have emerged
Ecosystem
At its core, understood to encompass a network of actors contributing to the creation of a focal offer’s user value proposition. This is underpinned by theoretical considerations, particularly the notions of complementarity and interdependence among ecosystem actors
Value chain perspectives
Epitomised by Porter’s work. Focuses on dissecting internal firm activities to discern sources of competitive advantage. Emphasis is placed on understanding the interplay and interrelationships among these activities to achieve strategic superiority
Supply chain perspectives
Gained prominence in the 1990s. Prioritise the efficient coordination of upstream and downstream actors to optimise input-output flows and mitigate coordination challenges.
Value creation within an ecosystem
Facilitated by the presence of both complementarities and interdependencies among actors, forming the foundation for new theoretical inquiries and frameworks
Interdependencies
Signify the structural relationships between actors, delineating how their offers are interconnected to create value. These connections occur at both the functional and transactional levels, shaping the roles of different actors within the ecosystem
Bottlenecks
Emerge in any system comprising multiple components as constraints that hinder the system’s performance. Within an ecosystem, these are offers or components whose limitations impede the realisation of the focal offer’s value proposition. These can evolve over time, necessitating strategic responses from firms to mitigate their impact. Identifying and addressing them through R&D investments, alliances, or integration strategies become crucial for firms navigating ecosystem complexities
Complementors
Play a pivotal role in ecosystem dynamics by offering products or services that enhance the value proposition of the focal offer. Unlike suppliers, complementors engage in demand-side pooled interdependencies, necessitating collaborative alignment structures for joint value creation. The nature of complementarity varies, ranging from strict complementarity to supermmodular complementarity, each presenting unique challenges and opportunities
Alliance literature
Examines how firms voluntarily cooperate with each other, emphasising the importance of governance mechanisms and firms’ capabilities to manage these alliances
Strategic networks literature
Grounded in sociology and highlights how the social structure of ties, often formed through alliances, can provide firms with advantages in terms of information, resources, and status
Ecosystem research
Starts with the focal offer, rather than focusing on individual firms or alliances. The focus is on understanding the linkages between activities and actors contributing to the focal offer’s value proposition and their impact on firms’ strategies and performance outcomes
Emerging paradigm
Characterised by ongoing exploration of concepts, assumptions, mechanisms, and approahces. Research on ecosystems represents this. Achieving convergence in this area is challenging due to differences in research objects and methodological complexities. Often, research on ecosystems lacks consideration of interdependencies between different offers contributing to the focal offer’s value proposition, hindering the assessment of why the perspective is necessary
Organisation decision choices
Including technological considerations and input-output flows, it significantly influences value creation, actor roles, and interdependencies. Different organisational configurations, e.g. platform-based ecosystems vs. product-based ecosystems, have implications for how firms compete and create value. It extends to how activities are organised across firms within the ecosystem
Firm-complementor interdependence
Requires coordination on both supply and demand sides
