Seeing through the network: Competitive advantage in the digital economy

Abstract

Firms operate in an environment that is increasingly permeated with digital technology. The incorporation of digital technology into products, services, and operations has significant implications on how firms can attain and sustain competitive advantage. Traditional strategic models of competitive advantage -such as the industry structure view, the resource-based view or the dynamic capabilities approach -are built on assumptions which lack validity in today's digital environments. Digitization radically changes the very nature of products, the process of value creation and, above all, firms' competitive environment. This study contributes to a better understanding of how firms may achieve sustained competitive advantage in this digital economy: It outlines a network-centric view which explains the competitive environment of firms being confronted with digital technology and its affordances. Based on the network-centric view, the firms may achieve competitive advantage by actively shaping the digital environment (i.e. applying a logic of effectuation) and by value co-creating of the interconnected firms in the digital environment. The framework may help firms to design and create strategies in order to attain and sustain competitive advantage in a digital economy.

Exploiting and Defending Open Digital Platforms with Boundary Resources: Android’s Five Platform Forks

“…We extend shared resource conceptualization in the ODP context by suggesting that platform complements, such as apps, should be viewed as a second type of shared resources. The above model remains consistent with the dominant cooperative perspective of platform strategy (e.g., Boudreau 2011, Eisenmann et al 2006) and with recent theorization on how competitive advantage relies on complementarities and network effects (Koch andWindsperger 2017, Sun andTse 2009). From this standpoint, our research presents boundary resources, such as an app store and an API, as means with which to extract appropriated relational rents (Lavie 2006) from the complementarities of the shared resources.…”

Conceptualising Capabilities and Value Co-Creation in a Digital Business Ecosystem (DBE): A Systematic Literature Review

“…In terms of the definition of DBE, most sources such as Benghozi and Salvador (2014), Korpela, Ritala, Vilko, and Hallikas (2013), Baggio and Chiappa (2013), Pan, Foo, and Tan (2014), Baggio and Del Chiappa (2014), and Koch and Windsperger (2017) inherit the DBE definition from scholars Nachira et al (2007) and Corallo, Passiante, and Prencipe (2007). (Kinnunen et al, 2013) x S-28 (Koch & Windsperger, 2017) x x x S-30 (Korpela, Ritala, et al, 2013) x x x S-20 (Lusch, Vargo, & Gustafsson, 2016) x S-40 x S-31 (Nagrath et al, 2015) x S-28 (Pan, Foo, & Tan, 2014) x x x S-42 (Pattinson & Johnston, 2015) x S-7 (Valkokari, 2015) x S-45 (Vargas et al, 2016) x S-6 (Weber & Hine, 2015) x Nachira et al (2007) define DBE as a business ecosystem catalysed by ICT, whereas Corallo, Passiante, and Prencipe (2007) propounds that DBE enhances traditional collaborative ventures such as centralised (client-server), distributed (peer-to-peer models) and hybrid (such as web services) models, to form a separate holistic model. Scholars such as Djatna and Luthfiyanti (2015), Graça and Camarinha-Matos (2017), Moisescu and Sacala (2016) suggest significant definitions for DBE.…”

“…Korpela, Ritala, Vilko, and Hallikas (2013), Graça and Camarinha-Matos (2017), Pattinson and Johnston (2015), and Baggio and Chiappa (2013) describe the characteristics of DBE from the metaphor of a biological ecosystem, where digital species have their independent behaviour and evolve overtime. A DBE possesses the business and technical perspective (Baggio & Del Chiappa, 2014;Djatna & Luthfiyanti, 2015;Koch & Windsperger, 2017). The business perspective studies the economy of society and how the business agents or stakeholders influence the formation of DBE or how the environment influences DBE (Graça & Camarinha-Matos, 2017).…”

“…The business perspective studies the economy of society and how the business agents or stakeholders influence the formation of DBE or how the environment influences DBE (Graça & Camarinha-Matos, 2017). The technology perspective elicits the technical infrastructure required in enabling a DBE (Baggio & Del Chiappa, 2014;Koch & Windsperger, 2017). The business and technology components are strongly coupled and co-evolve from time to time (Baggio & Chiappa, 2013).…”

“…DBE with its very distinct nature possesses many anticipated benefits. Baggio and Chiappa (2013), Djatna and Luthfiyanti (2015), Graça and Camarinha-Matos (2017), Koch and Windsperger (2017), and Korpela, Ritala, et al (2013) claim that by forming or joining a DBE enables businesses to gain a competitive advantage in the market. Information created and shared in a DBE is the key to achieving the competitive advantages by responding to the market demand in a timely and cost-efficient manner.…”