Reconstructing Business Ecosystem: A Phenomenon Review and Action-Centric Operationalization

Abstract

The business ecosystem phenomenon is a revolutionary that is causing a paradigm shift in strategy aggregation. However, lack of its operational definition stifles positivist research and impedes empirical verification, generalization, and application. The purpose of this essay is to investigate business ecosystem definitions through the lenses of business ecosystem and systems theory, with the goal of advancing a synthesized, operational definition. The authors performed an integrative and generative literature review using a meta-theoretical approach with lenses of systems theory and business ecosystem theory to reconstruct an action-centric operationalization of the business ecosystem phenomenon. The review finds that the interplay of collaboration, innovation and competition is not addressed, and the criterion construct of business ecosystem health is scarcely included in the definitions. A business ecosystem, according to the review, is "a meta-organization of interdependent entities orchestrated by a focal firm that aligns to a value proposition through collaboration and coevolves around an innovation, in order to achieve competitive advantage for delivering value to customers and to sustain the health of the ecosystem in a changing environment”. The operational definition posited reveals the hidden assumption of holism of the business ecosystem phenomenon, which professes systemic strategy investigation instead of narrow, firm level analysis, for configurational theorizing, invoking counterintuitive shift in scholarship and practice. The essay argues for transitioning the business ecosystem research mode from inductive to deductive and suggests new research direction.