Under the new paradigm of an information society, Japan is experiencing a vicious cycle between non-elastic institutions and insufficient utilization of the potential benefits of IT that impedes the structural change efforts of firms. In parallel with this, the advanced innovation-oriented projects of firms are undergoing a structural change. However, a dramatic deployment of i-mode service (NTT DoCoMo’s mobile Internet access service) in the late 1990s provides encouragement that, once the potential is exploited, Japan’s institutional systems can effectively stimulate the self-propagating nature of IT through dynamic interaction with it. The advancement of enterprise resource planning (ERP) software in a co-evolutional way between convergence for vendor strength and divergence for satisfying diversified customer base demonstrates a similar expectation. This expectation relates to a business field in which the advanced innovation-oriented projects of firms under a new paradigm can be expected to develop in the process of embodying a self-propagating function. Prompted by this demonstration, this paper on the basis of a comparative empirical analysis of the interaction between a software vendor (ERP firm) and ERP customers with different business models towards creating a self-propagating structure based on a co-evolutional process between internal motivation of the vendor and external expectations raised by customers, attempts to identify key conditions essential to creating a self-propagating structure for advanced innovation-oriented projects of firms.