Abstract
Following a new innovation strategy, software vendors move their software onto their software service platforms and open up their platforms to third-party software service vendors. Although many studies state that enlarging the scope of software service offerings is the goal of the platform providers, only a few studies have focused on the roles that the platform providers take on to achieve the goal. These studies identified that the platform providers not only manage the platform but also promote and regulate third-party software. In this article, we extend this research by analyzing the activities of how platform providers promote innovation. For the analysis, we use empirical data about software services gathered from AppExchange of Salesforce. The analysis identifies the clusters and positions of software services of Salesforce and third-party vendors in the software service network. Our analysis results show that Salesforce promotes innovation by provisioning software services that are in core positions or that are bridges between service clusters. Third-party vendors release software services that are complementary to those of Salesforce. Overall, the results suggest that platform providers need to position strategically their software services to build successful software ecosystems, and that research on innovation needs to analyze the roles and efforts of the platform providers in detail.
Highlights
O NE of the most interesting software innovation strategies is that software vendors create software service platforms for offering their software as a service and open up their platforms to attract third-party software vendors
While prior research suggests that a platform provider implements strategies for developing an ecosystem on the ground of its platform, our findings suggest to add the strategy of participating in the innovation that has been dedicated in prior research to the role of third-party vendors
We compared the positions of software services of a platform provider in a software service network with those of the third-party vendors
Summary
O NE of the most interesting software innovation strategies is that software vendors create software service platforms for offering their software as a service and open up their platforms to attract third-party software vendors. Collective intelligence enables the creation of new ideas through the voluntary sharing of knowledge and innovation resources of the platform users with each other, stimulating innovation beyond the individual stakeholder capabilities [1], [3]–[5]. This way, software can be reused to create new software, which would not emerge due to the limitation in resources otherwise. If it is possible to reuse software, a single software vendor, who has to focus on implementing a few features due to the development cost for software [6], can focus on the implementation of new innovative features instead of reimplementing existing features
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