Abstract
Recognizing opportunities enabled by digital technology (DT) has become a competitive necessity in today’s digital world. However, opportunity recognition is a major challenge given the influence of DT, which not only disperses agency across various actors, but also blurs boundaries between customers, companies, products, and industries. As a result, traditional entrepreneurship knowledge needs to be rethought and the effects of DT on opportunity recognition need to be better understood. Drawing from opportunity recognition theory – as one of the central theories in the entrepreneurship domain – this study builds on a structured literature review to identify and explain three direct as well as three transitive effects of DT on opportunity recognition. These effects have been validated with real-world cases as well as interviews with academics and practitioners. In sum, this study contributes to descriptive and explanatory knowledge on the evolution from traditional to digital entrepreneurship. As a theory for explaining, the findings extend opportunity recognition theory by illuminating how and why DT influences opportunity recognition. This supports research and practice in investigating and managing opportunities more effectively.
Highlights
Thomas Edison presented the first light bulb in 1879
As outlined in the method section, we found during our literature review that digital technology (DT) affects opportunity recognition in the form of a holistic enabler, whereas its characteristics are inconsistently used in literature and can neither be unambiguously differentiated nor mapped with regard to the single effects
Future research could conduct a second structured literature review in the digital entrepreneurship (DE) domain or other DT-related domains to generate a broader sample of studies relevant to opportunity recognition in a digital world, and to validate and enhance our findings
Summary
Thomas Edison presented the first light bulb in 1879. Today, digital technology (DT) influences the entrepreneurial endeavors of lighting companies by pushing the innovation limits of their light bulbs. Recognizing the potential, Philips developed Hue bulbs which, for example, warn against burglars (ifttt.com/hue 2020). In this example, DT enabled novel opportunities that Philips leveraged in the form of the digitally connected and re-programmable Hue bulbs. DT creates novel opportunity spaces for entrepreneurial endeavors (Ciriello et al 2018; Henfridsson et al 2018; Oberlander et al 2021). It enables digitalizing functions of and adding digital capabilities to physical products (Yoo et al 2010), and provides new ways of interaction between customers and companies (Lokuge et al 2019).
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