Innovation and Value Creation in Business Ecosystems

Abstract

Business ecosystems are an emergent type of organizational form that can be defined as “the alignment structure of the multilateral set of partners that need to interact in order for a focal value proposition to materialize” (Adner in Journal of Management 2017). Gulati, Puranam, and Tushman (Strategic Management Journal 33(6): 571–586, 2012) have identified such ecosystems as a novel type of organizational form, which combines open membership boundaries with a highly stratified and more hierarchical decision making. Such new organizational forms are increasingly important in highly competitive global industries (Ilinitch, D’Aveni, and Lewin in Organization Science 7(3): 211–220, 1996; Volberda in Organization Science 7(4): 359–374, 1996). A key decision for firms managing a business ecosystem is how to design such governance decisions, as they can impact the rate and degree at which innovations arise and value is created. This chapter focuses on how firms manage these interdependencies with other actors that emerge in business ecosystems, and how the strategic management of such interdependencies affects innovation and value creation in business ecosystems.