Abstract
PurposeThe purpose of this paper is to understand which controlling and enabling practices are used, how the numerous supplying partners are managed and how positive network effects are generated in online service triads (multi-sided platform – supplying partners – consumers).Design/methodology/approachA single representative in-depth case study was conducted to refine theory on managing service triads. The main data source consists of field notes collected by one author, who held a temporary position within the organization. Additional data were collected from observations, internal documents, informal talks and 20 interviews.FindingsThe authors found controlling and enabling organizational practices in four main categories on two levels as follows: managing network composition (system level), managing order fulfillment and returns (operations level), category management (both levels) and capability enhancement (both levels).Research limitations/implicationsThe authors show that both controlling and enabling practices are present in online service triads. This enables platform owners and supplying partners to share responsibilities for creating positive network effects, i.e. to increase scale, which increases value, which again attracts more suppliers and consumers, which creates more value, etc.Practical implicationsThe authors present a range of and controlling and enabling practices that describe how multi-sided platforms can manage numerous supplying partners in an online context.Originality/valueThis study is the first to show that contractual and relational governance is insufficient in service triads in online settings with numerous supplying partners. Further, the authors provide empirical evidence that supply networks continuously adapt over time.
Highlights
Service supply chain management has had to change because of the increasing use of online service channels for communicating and providing services to consumers
We found that controlling and enabling practices of the organization occur on two following distinct levels of the organization: on the system level, which encompasses practices of a more strategic nature that are aimed at constituting the network, and on the operations level where daily processes are executed
Annual growth in sales volume of more than 20 per cent (2012-2016) coupled with an improved delivery performance provided evidence that the e-commerce platform was able to manage these balancing challenges and that the services provided by supplying partners directly to consumers were appreciated by consumers
Summary
Service supply chain management has had to change because of the increasing use of online service channels for communicating and providing services to consumers Consumers can order their products from home 24/7, with subsequent same-day or next-day delivery. Through using information and connected technologies, multi-sided platforms serve as intermediaries between consumers and suppliers (Hagiu and Wright, 2013). These platforms use an open business model that relies on independent participants (Parker et al, 2016) aiming to co-create and appropriate value (Eisenmann et al, 2006; Gawer and Henderson, 2007; Armstrong, 2006). Value appropriation can occur by generating positive network effects, i.e. a feedback loop where larger scale generates more value, which, in turn, attracts more suppliers and consumers, which, in turn, creates more
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