Value Destruction in Information Technology Ecosystems: A Mixed-Method Investigation with Interpretive Case Study and Analytical Modeling

Abstract

Value destruction is intertwined with value co-creation in the technology alliances and ecosystems; this is a key reason that most partnerships fail in the real world. Managers and policymakers will be enabled to identify destructive behavioral signals right from the onset drawing on our findings that opportunism, unjust appropriation of rents, shirking, exploitation of asymmetric power, and undue dependence can initiate the value destruction process. For the partners in an ecosystem, our findings underscore that opportunistic and exploitative behaviors do not pay off in the long run as these result in collateral and unintended losses for all. Dominant partner’s opportunism and exploitation of power asymmetry could give rise to a proverbial “pack of wolves,” a collective of resentful partners, for “challenging/killing the lion”—replacing the hub firm itself. In this vicious cycle, original intent of value co-creation gets lost with multidimensional losses on multiple fronts to the extent that opportunities open up even for the competitors with the help of hub’s former resentful complementors. Equipped with this knowledge, leaders can proactively manage ecosystem relationships keeping them on the path of originally intended value co-creation by remaining alert toward catching the signals of value destruction and reverting it deftly toward value co-creation.