Abstract:We study the market for apps on Facebook, the dominant social networking platform, and make use of a rule change by Facebook by which highly engaging apps were rewarded with further opportunities to engage users. The rule change led to new applications with significantly higher user ratings being developed. Moreover, user ratings became more important drivers of app success. Other drivers of app success are also affected by the rule change; sheer network size became a less important driver for app success, update frequency benefitted apps more in staying successful, and active users of Facebook apps declined less rapidly with age. Our results show that social media channels do not necessarily have to be managed through hard exclusion of participants, but can also be steered through "softer" changes in reward and incentive systems.

Please scroll down for article-it is on subsequent pagesWith 12,500 members from nearly 90 countries, INFORMS is the largest international association of operations research (O.R.) and analytics professionals and students. INFORMS provides unique networking and learning opportunities for individual professionals, and organizations of all types and sizes, to better understand and use O.R. and analytics tools and methods to transform strategic visions and achieve better outcomes. For more information on INFORMS, its publications, membership, or meetings visit http://www.informs.org T he introduction of a new product generation forces incumbents in platform markets to rebuild their installed base of complementary products. Using three different data sets on the U.S. market for video game consoles, we show that incumbents can, to some extent, substitute for rebuilding their new installed base by making their new products backward compatible, which lets them draw on the installed base of software for the parent generation. However, while this positive direct effect of backward compatibility dominates in our setting, we also observe a (weaker) negative indirect effect working through the reduced supply of new software. We find that both effects are moderated by the age of the new technological generation and by the technological leap between generations: backward compatibility becomes less important with increasing console age and larger technological improvement between generations.

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Research Summary: Entry into dynamic environments can be challenging for firms. We study if, and under which circumstances, firms can use strategic flexibility to enter markets with variable demand. In the airline industry, we find broad support for our hypotheses. We observe less entry with more demand variation, more entry of more flexible firms, and that more flexible firms are more likely to enter markets with greater variation in demand. Furthermore, we find that this relationship is especially strong when variation in demand is harder to predict, which suggests that strategic flexibility is most valuable in unpredictable turbulent environments. Managerial Summary: We show that firms in the airline industry that choose strategic flexibility over operational efficiency are more likely to enter volatile markets. This finding is especially true when future demand is difficult to forecast using historical data. We conclude that strategic flexibility can be a useful complement to investments in business analytics. K E Y W O R D S airline industry, demand change, flexibility, market entry, uncertainty

* This version of the article has been accepted for publication and undergone full peer review but has not been through the copyediting, typesetting, pagination and proofreading process, which may lead to differences between this version and the publisher's final version AKA Version of Record.

* This version of the article has been accepted for publication and undergone full peer review but has not been through the copyediting, typesetting, pagination and proofreading process, which may lead to differences between this version and the publisher's final version AKA Version of Record.

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We address the contested state of theory and the mixed empirical evidence on the relationship between turbulence and vertical scope by studying how turbulence affects the benefits of commitment from integrated development of components and the benefits of flexibility from sourcing components externally. We show that increasing turbulence first increases but then decreases the relative value of vertical integration. Moderate turbulence reduces the value of flexibility by making supplier selection more difficult and increases the value of commitment by mitigating the status quo bias of integrated structures. Both effects improve the value of integration. Higher levels of turbulence undermine the adaptive benefits of commitment, but have a less adverse effect on flexibility, making nonintegration more attractive. We also show how complexity and uneven rates of turbulence moderate the nonmonotonic relationship between turbulence and integration. This paper was accepted by Jesper Sørensen, organizations.