Exploring the Process of Business Ecosystem Emergence from Value Chains: Insights from the Chinese Mobile Phone Industry

Abstract

A business ecosystem is a community of multiple co-evolving actors with interdependent product offerings organized around a specific value proposition. While the extant literature focuses on these two structural elements of ecosystems that existed ex ante, we challenge this notion with our core discovery that ecosystem actors emerge in an ex post dynamic process. With a longitudinal qualitative study of the vertically disintegrated part of the Chinese mobile phone industry, we develop a two-dimensional process model of ecosystem emergence, namely the temporal dimension that delineates three processal stages of ecosystem emergence and the spatial dimension that highlights an architectural pattern of reciprocities between value chain and resource pool to enable the ecosystem emergence. We also offer inter-temporal enabling conditions during ecosystem evolution. These findings enable us to complement the ecosystem literature by elaborating the antecedents, outcomes, and enabling conditions of ecosystem emergence in relation to multiple types of ecosystem actors. We also shed light on the value chain (re-)configuring process which derives from the reciprocity between value chains and ecosystem resources.

When and how do innovation ecosystems outperform integrated organizations? On technological interdependencies and ecosystem performance

“…Successful innovation in an ecosystem often hinges on the compatibility and complementarity between components produced by independent firms in the ecosystem (Adner and Kapoor, 2010;Ganco et al, 2020;Jacobides et al, 2006;Teece, 1986). Therefore, an innovation ecosystem cannot come into existence without collaboration and coordination between different actors such as the upstream component suppliers and downstream clients (Hou and Shi, 2021;Jacobides et al, 2018;Shi et al, 2022).…”

“…Third, our model demonstrates how various actors may join or exit the ecosystems, driven by innovation searching behaviors of focal firms. These changes in the ecosystem structure, over time, shape the ecosystem resources that focal firms may mobilize and allocate (Gao et al, 2019;Shi et al, 2022;Shi and Shi, 2021), which enriches our knowledge on ecosystem governance. In this sense, we instantiate how focal firms may deliberately alter the structure of ecosystems by deploying innovation searching behaviors and how focal firms' ecosystem strategy may shape the co-evolutions between modular structure and the value co-creation arrangements within ecosystems (Ganco et al, 2020;Hou and Shi, 2021;Jacobides et al, 2018).…”

Business model design and mass customization capability: is supply chain integration a missing link?

“…First, NBMD encompasses a set of business activities that consists of new partners applying new ways to transactions in a social network (Hou and Shi, 2021;Amit and Zott, 2015). Novelty BMD supported by the business ecosystem should be far beyond performing their activities and encourage implementing an extension process with leverageable resources (Liu and Stephens, 2019;Shi et al, 2021). Second, EBMD plays an efficient transaction with existing incumbents.…”

“…Establishing novel business models need to take into account new logic of the firm for products and services. When the focal firm pursues NBMD, they will seek to implement a set of activities to integrate the relationship with partners (Shi et al, 2021), thereby promoting the MCC. In particular, when designing the NBMD, the firms will better perform the customization according to the heterogeneity product and service requirements.…”

“…Establishing novel business models need to take into account new logic of the firm for products and services. When the focal firm pursues NBMD, they will seek to implement a set of activities to integrate the relationship with partners (Shi et al. , 2021), thereby promoting the MCC.…”