Vendor capabilities development in blockchain sourcing: A parallel play approach

Abstract

Vendor capabilities development has been an important research stream in the information systems (IS) sourcing literature. The existing research, which was based on the context of implementing centralized enterprise systems, focused on the adoption of deliberate learning and implicit learning, with the assumption that effective selection between these two learning approaches is sufficient for service providers to acquire vendor capabilities. However, this assumption may not hold in implementing a decentralized system based on enterprise blockchain. Because an enterprise blockchain system affords a new way of governing transactions and demands a new governance mode, it creates an uncertain and complex landscape in which the mere selection between deliberate learning and implicit learning becomes insufficient. Addressing this gap is crucial because many enterprise blockchain projects fail due to the incompetence of service providers. By conducting an in-depth case study of a successful blockchain service provider, our study reveals a new mechanism for developing vendor capabilities: parallel play. As with parallel play by preschoolers, the service provider combines a set of learning approaches featuring borrowing from peers and learning through experimentation. Our study extends the IS sourcing literature on vendor capabilities development from the context of implementing centralized enterprise systems to the context of implementing decentralized enterprise blockchain systems. Our findings also provide guidelines for blockchain service providers to follow when acquiring vendor capabilities and for clients to use when selecting service providers.