Path Dependent Platforms : A Process Perspective on Enterprise Ecosystem Governance

In their editorial to the workshop on the role of platforms for enterprise ecosystems, Beimborn et al. (2011: 4) emphasize that “the emergence of platforms as backbones for inter-organizational cooperation and collaboration also impacts the way economic activity is organized.” In a similar vein, Tiwana et al. (2010: 686) argue that platform-based enterprise ecosystems actually constitute “complex alliance networks”, where an approach grounded in literature on inter-organizational relationships might be a helpful complement to “the burgeoning exclusively macro, two-sided markets literature in economics.” Conceptualizing the relationships between platform and module providers as historically contingent, inter-organizational processes exhibits both new explanatory potentials and methodological difficulties. Scholars in the tradition of the two-sided markets paradigm such as Economides and Katsamakas (2006) ask how collaborative or competitive the relationship between platform leader and providers of complementary goods should be. In contrast, focusing on inter-organizational relations (e.g., Dyer and Singh 1998) would acknowledge that such a question cannot be decided in the abstract but rather depends, among others, on a platform’s governance history and expected future. Coming from such an organization-theory perspective, it might sound odd to combine such an approach with insights from path dependence theory, which again roots in works by the economists David (1985) and Arthur (1989). The reason for this choice is threefold: first, while we do want to strengthen the role of managerial contingency in platform governance, we want to warn against overstating managerial leeway too. Second, as pointed out by Langlois (2002: 25), modular innovation promoted by platforms might come at the cost of increasing costs of systemic innovation. Third, recent applications of path dependence theory in an organizational realm (see, for example, Sydow et al. 2009; Dobusch 2010) sensitize for rigidities or even lock-ins in particular, which may result from initially successful governance practices. All these points taken together imply following the recommendation by Tiwana et al. (2010: 685) to “explicitly consider the possibility of nonlinear and threshold effects.

A Review of Positive Feedback Mechanisms in Technology Markets, Regional Clusters, and Organizations

The concept of path dependence has often been criticized as vague and only narrowly applicable. Although we can find some very refined definitions of the concept, we also find a wide range of empirical phenomena being described as path-dependent. We argue that more detailed accounts of the positive feedback mechanisms that form paths can take path dependence beyond this state of being overdetermined, but under-specified. Reviewing three well-described cases of path-dependent dynamics in technology markets, regional clustering, and organizations, we define a core set of positive feedback mechanisms that constitute path dependence at different analysis levels and clarify the relationship between positive feedback and increasing returns. We show that path-dependent processes, that is, processes driven by positive feedback that veer toward rigidity or lock-in, can be (but do not have to be) found under many labels, including structural inertia, coevolution, or institutional persistence. We conclude that a precise definition of path dependence does not need to be at odds with the concept’s widespread use in understanding organizational and industrial development processes

Making an Impression Through Openness: How Open Strategy-Making Practices Change in the Evolution of New Ventures

While previous open strategy studies have acknowledged open strategy's function as an impression management instrument, their focus has mostly been on short episodes. The impression management literature, meanwhile, pays openness scant attention. By studying how new ventures engage in open strategy-making, we track how open strategy-making and respective impression management benefits evolve over time. Specifically, we draw on a comparative case study of two firms' blog communication on strategy-related issues and corresponding audience responses over a four-year period. We identify three distinct modes of how organizations engage in open strategymaking with external audiences and show how each mode is related to a specific set of impression management effects. Having established the impression management functions of these modes, we then demonstrate how open strategy-making contributes to new ventures' quests for legitimacy as they evolve. In the launch phase, dialoguing with blog audiences helps a venture attract endorsements for its organization and products. As the venture grows, concentrating on broadcasting relevant strategic information may attract media audiences' additional support for pursuing openness as a desirable organizational practice

Transnational Copyright: Misalignments between Regulation, Business Models and User Practice

In this paper we analyse discursive struggles over what is referred to as legal and illegal user practices in the internet as an outcome of regulatory uncertainty. The latter, in turn, is examined in the context of a multi-layered transnational copyright regime characterised by three features: the absence of an universally recognized single authority in charge of law-making, fragmented and partially contradicting forms of regulation of global, national and sectoral scope, and considerable indeterminacy of rule interpretation and application arising from the variety and distinctiveness of local usage contexts. We argue that notions of legality and illegality are used strategically by different actors to resolve perceived misalignments between regulation, business models and user practices. The results indicate that the meaning of legality and illegality, while often presented as well-defined distinction, in the case of internet user practices is often far from clear-cut and generally accepted. In fact, copyright industry, intermediaries, users and regulators are involved in what Black (2002) refers to as “regulatory conversations”. Analysing these regulatory conversations offers a revealing entry point to study how under conditions of transnational regime complexity and diffusion of new technology solutions to regulatory uncertainty are negotiated in a multiplicity of social contexts

A Process Perspective on the Formation and Diffusion of Transnational Standards

Standards are receiving increasing attention, especially at the transnational level where standardization aims at coherence and social ordering beyond the nation-state. However, many attempts to bring about uniformity via formalized standards fail. To understand better how such rules successfully span national and organizational boundaries over time, we compare two cases of standardization in international business. Both Windows desktop software and International Accounting Standards demonstrate the need for a process perspective to understand and explain social ordering through standards. Long- lasting standardization processes require conceptualizing how different sequences of transnational standardization relate to each other. We find that at the core of such recursive cycles is the interplay of input and output legitimacy

Copyright reform and business model innovation: regulatory propaganda at German music industry conferences

Inspired by new digital technologies, diverse actors in cultural and creative industries propagate conflicting visions of how to adequately innovate – or rather preserve and strictly enforce – copyright-related business models, which has resulted in substantial amounts of regulatory uncertainty. Looking at a decade of regulatory discourse at industry events in the popular music industry in Germany, we investigate how these actors make sense of and strategically shape this uncertainty in the process of industry transformation. Our longitudinal argumentative discourse analysis reveals cycles of regulatory propaganda of two discourse coalitions that do not engage in debate, but aim to find support for competing business models among regulators and the public. Organizing, canceling, and participating in industry events are discursive strategies used effectively to transport their claims by both industry lobbyists and challenging actors, but industry incumbents are failing to use these sites for testing out and introducing new business models. We conclude that regulatory struggles, not least at industry events, mediate between disruptive technologies and business model innovation

"Why Is Economics Not an Evolutionary Science?" New Answers to Veblen's Old Question

Addressing the question why Economics as a discipline is not subject to evolutive processes itself, we explain the paradigmatical dominance of neoclassical theories in Economics as a path dependent process. Recognizing economics as "locked into neoclassical thinking," we first identify three positive feedback mechanisms leading to strong barriers to paradigmatic change: coordination, complementarity, and learning mechanisms. In a second step, we show how actors strategically enforce these mechanisms via distinct "amplifiers." We then try to use this theoretical perspective to cursorily describe potentially path-breaking strategies

Epistemic Communities and Social Movements: Transnational Dynamics in the Case of Creative Commons

While the existence of transnational communities is increasingly recognized in globalization studies, very little is yet known about their impact on global governance. Studies investigating the role of transnational communities in international rule setting tend to specialize in specific types, such as epistemic communities, social movements, or policy networks, and narrow down their effects to agenda setting or issue framing. In this paper, we choose a broader view. We examine the regulatory effects which arise when different types of transnational communities with a common goal operate in concurrence through all phases of the rule-setting process. The empirical research of this papers focuses on the transnational governance field of copyright. More specifically, we study transnational communities aiming to overcome limitations to the prevalent transnational copyright regime in the face of new information technology. On the basis of a longitudinal case study, we show how an epistemic community and a social movement came to interact around the non-profit organization “Creative Commons” in ways which provided unforeseen momentum for their rule-setting project. This impetus generated both functional and latent effects. While the rapid growth of the social movement enabled Creative Commons to successfully disseminate its private licenses among producers of digital intellectual goods, bypassing classical regulators and policy makers, it also threatened the goals and internal decision making of Creative Commons itself. Following the division of Creative Commons into two separate, but still connected, organizations, it remains to be seen how the interaction of the epistemic community and social movement will evolve in the future.Obwohl die Existenz transnationaler Gemeinschaften in der Globalisierungsforschung immer mehr anerkannt wird, bleibt deren Einfluss auf globale Steuerung und Regulierung immer noch größtenteils im Dunkeln. Studien über die Rolle transnationaler Gemeinschaften im Bereich internationaler Regulierung konzentrieren sich meist auf spezifische Typen, wie epistemische Gemeinschaften, soziale Bewegungen oder politische Netzwerke, und beschränken deren Effekte auf Agenda-Setting oder Framing von Themen. In diesem Papier wählen wir eine breitere Perspektive. Wir untersuchen regulatorische Effekte, die entstehen, wenn verschiedene Typen von transnationalen Gemeinschaften mit einem gemeinsamen Ziel gleichzeitig sämtliche Phasen des Regulierungsprozesses durchlaufen. Der empirische Teil des Papiers konzentriert sich auf transnationale Regulierung im Bereich des Urheberrechts. Konkret untersuchen wir transnationale Gemeinschaften, die Beschränkungen des vorherrschenden Urheberrechtsregimes angesichts neuer Informationstechnologie zu überwinden suchen. Auf Basis einer Längsschnittstudie zeigen wir, wie eine epistemische Gemeinschaft und eine soziale Bewegung rund um die gemeinnützige Organisation "Creative Commons" interagieren und so unvorhergesehenen Schwung in ihrem Regulierungsprojekt auslösen. Diese Dynamik erzeugte funktionale ebenso wie verborgene Effekte. Während das schnelle Wachstum der sozialen Bewegung die erfolgreiche Diffusion von den privaten Lizenzen von Creative Commons – vorbei an klassischen Regulierern und politischen Akteuren – unter Erzeugern von digitalen intellektuellen Gütern ermöglichte, bedrohte es Ziele und interne Entscheidungsstrukturen von Creative Commons selbst. Wie sich das Zusammenwirken von epistemischer Gemeinschaft und sozialer Bewegung nach der Teilung von Creative Commons in zwei getrennte, aber immer noch miteinander verknüpfte Organisationen weiterentwickelt, wird erst die Zukunft zeigen.1 Introduction 2 Conceptual framework: Transnational epistemic communities and social movements 3 Method and data 4 Technological and political context: The internet challenge to the traditional regulation of copyright 5 Creative commons: Epistemic community concurring with social movement Birth of an epistemic community and formation of a non-profit organization in the United States Transnationalization of epistemic community and organization Unexpected effects of success: Social movement organizations joining in Organizational decoupling: A split-up for unity 6 Conclusions Reference