Socio-technical Complexity in Digital Platforms: The Revelatory Case of Helix Nebula: The Science Cloud

Abstract

(a) Situation faced: The digitalization case reported here refers to the digital platform Helix Nebula—The Science Cloud. Early after the go-live in 2014, Helix Nebula aimed to compete with leading digital platforms such as those of Microsoft and Alphabet. To this end, Helix Nebula extended its scale and scope of inter-organizational collaboration toward a digital ecosystem. In effect, four leading European information technology (IT) providers started cooperating with partners over a shared digital platform to deliver cloud services to client organizations. Value-destroying high levels of socio-technical complexity resulted. This complexity increasingly inhibited the digital platform Helix Nebula from thriving and growing. (b) Action taken: Helix Nebula implemented four consecutive and interrelated actions to counteract complexity. First, it modelled its digital ecosystem entailing platform owners, partners, clients, and subcontractors. Second, it agreed on a shared understanding of socio-technical complexity comprising four constituents: structural organizational, dynamic organizational, structural IT, and dynamic IT complexity. Third, it identified manifestations of these constituents in its digital ecosystem. Fourth, it took according countermeasures to reduce these manifestations. While two countermeasures (orchestration and standardization) reflect the need of maintaining organizational and technological integrity, the other two (autonomization and modularization) reflect the need of maintaining organizational and technological elasticity in digital ecosystems. (c) Results achieved: Helix Nebula has reduced its digital ecosystem’s socio-technical complexity to value-adding levels. This reduction contributed to realizing three interrelated improvements. First, Helix Nebula has scaled more effectively from initially 10 partners to currently 40. Second, partly owing to reduced socio-technical complexity, Helix Nebula has improved its efforts in co-creating value through more effectively exchanging, adding, and even synergistically integrating resources. Third, in implementing the countermeasures against socio-technical complexity, Helix Nebula has developed four capabilities for facilitating a thriving digital platform. These capabilities deal with the intricacies of digital ecosystems that substantially complicate digital platforms’ state of continued existence. (d) Lessons learned: First, facing considerable challenges in analyzing its evolving digital ecosystem, capturing all dimensions and characteristics of socio-technical complexity in digital platforms proved intricate. In effect, Helix Nebula managers have favored the parsimonious and succinct framework presented in this work conversely. Second, Helix Nebula managers adopt an ambidextrous approach to reducing complexity. That is, successful digital platforms balance (i) top-down, central control imposed by platform owners and (ii) bottom-up, decentral generativity imposed by platform partners, clients, and subcontractors. Third, complexity in digital platforms can pose both good effects (enabling, rewarding, value-adding, required, desirable) and bad effects (constraining, unrewarding, value-destroying, unrequired, undesirable).