Abstract
In this empirical research, the author focuses on the enterprise resource planning (ERP) software market. Based on a contingent perspective of how markets emerge and can be shaped, the author asks the research question of whether the emergence of the ERP market was a necessary, strong, or weak consequence of the product innovation of Systems, Applications & Products in Data Processing (SAP), which was the pioneer innovator in this specific market. This question is answered with a graph theoretical model of contingency and causality in order to measure the causality between events occurring over historical time. In this sense, the research article provides an application of the method proposed by Lehmann-Waffenschmidt. The author finds that the emergence of the ERP software market is contingent and was not predetermined; path dependencies play a big role in the way how this market segment emerged. With respect to both entrepreneurial and economic factors of relevance, the case of the SAP is far from a predetermined success story. The results are relevant for a number of reasons. First, the results indicate that instead of talking about success stories, a new perspective in market shaping can highlight a more realistic way of the contingent nature of entrepreneurial activity and product innovations. Second, the results aim to bridge the gap between marketing and the emergence of markets, as it was indicated as a research gap by recent contributions in marketing science. Third, the introduction of counterfactual events in the business history of SAP indicate a methodological innovation that has not yet been considered by marketing and entrepreneurship scholars, which may be helpful regarding recognizing patterns from the past and also regarding contingent planning for the future.
Highlights
The evolution of a new market is an interesting phenomenon from the perspective of economics, because it reflects how intended human action may have unintended consequences, leading to a dilemma very often discussed, but never finalized by the discipline of economics [1]: On one hand, economic policies aim to provide suitable conditions and incentives for the emergence of new markets; on the other hand, the process of market emergence itself is a gradually self-organized, partially open-loop system characterized with the emergence of novelties
This section aims to present an analytical model of the evolution of SAP’s (Systemanalyse und Produktentwicklung in German, or, Systems, Applications & Products in Data Processing in English) product innovation “R” and the way it shaped the market over irreversible historical time
4.1, the author concludes that the emergence and the diffusion of an the software program (Ei ) and the event of successful market shaping
Summary
The evolution of a new market is an interesting phenomenon from the perspective of economics, because it reflects how intended human action may have unintended consequences, leading to a dilemma very often discussed, but never finalized by the discipline of economics [1]: On one hand, economic policies aim to provide suitable conditions and incentives for the emergence of new markets; on the other hand, the process of market emergence itself is a gradually self-organized, partially open-loop system characterized with the emergence of novelties This dilemma is reflected in the theoretical literature [1], and in the discussion on the relationship between economic freedom and entrepreneurial activity on the national level, where the factors of influence boil down to the infrastructural-institutional factors and factors associated with the activities of individuals on market shaping [2,3].
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