Digital Innovation and Ecosystems

(Bohnsack et al. 2021). In innovation ecosystems, while there is much knowledge on the parts of ecosystems, there is less knowledge about the whole (Wang 2021). With very few exceptions (Basole 2009), less is known about the causes and dynamics that result in ecosystem change. In this thesis, the focus is placed on industrial-age innovation ecosystems, which serve as the conceptual basis for the investigations on the transformative impact of digital technologies and innovation on ecosystems. In contrast to the scarcity of studies on digital innovation and industrial-age ecosystems, literature in the field of IS has created a large body of knowledge on purely digital ecosystems resulting from the increasing use of digital technologies. The following section provides an overview of this ecosystem research stream.

et al. 2016; Song et al. 2018). Complementors in this digital platform ecosystem are developing complementary goods and services (e.g., Hein et al. 2019). Thus, complementors are an essential part of the digital ecosystem, where success can be attributed to the engagement of complementors (Engert et al. 2022; Wang and Miller 2020). This engagement spans from developing, enhancing, and commercializing products to cooperate and ensure compliance (Engert et al. 2022). Given the essential role of complementors, platform owners sometimes choose to acquire them externally to improve the platform’s capabilities by including already developed innovations (Staub et al. 2021).

Moreover, research has investigated digital platform-based ecosystems by focusing on technical aspects, such as a digital platform’s architecture, which describes “how the ecosystem is partitioned into a relatively stable platform and a complementary set of modules that are encouraged to vary, and the design rules binding on both” (Tiwana et al. 2010, p. 677). Tiwana et al. (2010) have emphasized the interplay between platform architecture and platform governance, both as part of platform design and governance. While desirable from a platform owner’s perspective, an open platform’s governance design, resulting in more autonomy to third-party contributors that adopt the platform (Wareham et al. 2014; Benlian et al. 2015) might have unforeseen consequences for complementors’ survival and growth (Chen et al.

2021).

A large body of research has investigated the governance of digital platform ecosystems (e.g., Uzunca et al. 2022; Bonina et al. 2021; Wareham et al. 2014).

Several governance foci and mechanisms used in platform owners' and complementors' interactions were examined (Huber et al. 2017). By describing governance of a platform ecosystem as a process, Huber et al. (2017) have revealed that the relationship of a platform owner and complementors has potential to develop from arm’s length governance with strict rules and limited co-created value to a partnership with higher levels of co-created value. In a similar vein, Wareham et al.

(2014, p. 1210) have pointed out that “ecosystem governance must do far more than simply mitigate agency conflicts, with a far more complicated set of requirements and leverage points.” Hence, to successfully build and manage platform ecosystems, platform owners need to provide support for complementors in the form of boundary resources (Eaton et al. 2015; Ghazawneh and Henfridsson 2013) to enable resource sharing and foster external contribution (Eaton et al. 2015). Boundary resources are

commonly deployed by the platform owner (Ghazawneh and Henfridsson 2013;

Zapadka et al. 2022). Platform owners need to overcome knowledge boundaries, providing various resources at the boundary, such as information portals, documentation, helpdesks, and alignment workshops (Foerderer et al. 2019).

Formulating a sustainable value proposition is not only relevant for customers but also complementors (Wareham et al. 2014). Tiwana (2014) has highlighted additional areas that need to be managed or governed by a platform authority. Those include, first, gatekeeping to determine the internal and external actors of the ecosystem;

second, platform evolution, which involves deciding how a platform’s functionality evolves and who should influence that decision; and, third, decision rights, determining who has the authority to decide and what is the division of responsibility and authority between the platform owner and complementors (e.g., apps developers). Despite the seemingly symbiotic relationship between complementors and platform owners, complementors frequently are in danger of experiencing competition with the platform owner (Foerderer et al. 2018). Platform owners, such as Apple, Google, and SAP, frequently penetrate the product spaces of complementors by adding first-party features or incorporating already existing ones into the platform's core, thereby harming the operations of complementors (Bender and Gronau 2017).

With the increasing association of digital technologies and ecosystems leading to emerging digital innovation even in the established ecosystem context, the literature has described digital business ecosystems² (Nischak et al. 2017, p. 13) as a

“combination of heterogeneous actors, interacting co-opetitively by fundamentally drawing on a shared set of digital resources in conjunction with non-digital resources […].” Members of this ecosystem are related to each other by an underlying co- creation of value, contributing to a common value proposition. Digital business ecosystems describe digitalized business environments (El Sawy and Perreira 2013),

2The term “Digital Business Ecosystem” (Nischak et al. 2017) differs from an “Innovation Ecosystem”

described by the essential work of Adner (2017), as the study was published just before Adner. The rationale behind both perspectives is similar, as joint value creation for a focal value proposition is emphasized. This thesis follows the term “Innovation Ecosystem” as it more accurately reflects the subject of investigation.

in which ecosystems are predominantly founded on digital technologies, such as a digital platform (Tan et al. 2020; Suuronen et al. 2022).

The majority of studies on IS have concentrated on a particularly narrow range of topics, for example, emphasizing governance of digital platform-based ecosystems (Song et al. 2018; Huber et al. 2017); its platform resilience (Floetgen et al. 2021);

platform typologies (Ghazawneh and Henfridsson 2015); or IT capabilities (Tan et al.

2015). However, insights into the overall gestalt, structure, and ecosystem composition and changes from such a broad perspective are missing in IS research (Wang 2021; Ghazawneh and Henfridsson 2013; Jha et al. 2016). Scholars have predominantly focused on purely digital contexts or the IT industries (e.g., Basole 2009; Beltagui et al. 2020; Schreieck et al. 2021), although the literature has recognized that established contexts and ecosystems are also affected by emerging digital technologies and digital innovation (Yoo et al. 2010; Bohnsack et al. 2021).

Finally, even though the literature has extensively differentiated between the two ecosystem roles of platform owners and complementors, IS research has so far refrained from elaborating ecosystem roles suited to contexts that differ from purely digital instances.