Platform-based Innovation Management: Directing External Innovational Efforts in Platform Ecosystems
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Platform-based Innovation Management: Directing External Innovational Efforts in Platform Ecosystems Simone Scholten & Ulrich Scholten
Received: 17 May 2011 / Accepted: 21 November 2011 / Published online: 13 December 2011 # Springer Science+Business Media, LLC 2011
Abstract Modular platforms have become the centerpiece of collaborative value creation in platform ecosystems. Platform ecosystems co-create the platform’s value proposition and support its market adoption as the more complementors join the ecosystem to supply complementarities, the more valuable the platform becomes to consumers due to a greater variety of choice. This poses new requirements on managing innovation in open platform environments. While academic research stresses the relevance of external complementary innovation for platform success, it lacks, however, a concrete understanding to guide platform owners in directing external innovational efforts in coopetive platform ecosystems to co-create and deliver value while ensuring the overall quality, reliability and consistency of the ‘whole’ solution. Based on the challenges platform ecosystems place on innovation management, this paper explores and categorizes control mechanisms leading platform owners in the ICT industry have implemented to steer external complementary innovation efforts. From that an overall platform-based innovation management process is developed. Keywords Two-sided platform businesses . Platform ecosystems . Innovation management . Control mechanisms
Introduction Global economy migrates from vertically integrated enterprises towards specialized enterprises inter-operating to create end-to-end value to consumers. The driving
S. Scholten (*) SAP Research, Dietmar-Hopp-Allee 16, 69190 Walldorf, Germany e-mail: [email protected] U. Scholten Karlsruhe Institute of Technology (KIT), Englerstraße 11, 76131 Karlsruhe, Germany e-mail: [email protected]
J Knowl Econ (2012) 3:164–184
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force is the consumers’ demand for “product and service customization, speed and high levels of quality of service, all in a seamless fashion and preferably from a single owner. In many instances, consumers will only use and continue using products and services if their value preferences and criteria are met or exceeded by the services owner” [4]. Preferences change rapidly, driven by demand for innovation, flexibility and shorter time-to-market [9]. Market requirements may even change while the product is still under development [34]. In consequence, corporate innovation efforts become riskier and more costly. In order to cope with these challenges, while keeping the focus on core competencies and cost efficiencies, companies, i.e. in High Tech industry, are implementing open modular platform concepts, enabling them to create vibrant ecosystems of innovation around their offerings [13, 31]. This process cannot be reduced to simple outsourcing decisions, but is part of renewed strategies of open innovation in an increasingly dynamic economic climate. Therein, companies are forced to
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