Development Strategy, Viability, and Economic Institutions: The Case of China

development strategy, institution, viability, trinity system

Identity Projection Strategies for Non-Focal Actors in Digital Ecosystems

In digital ecosystems, non-focal actors cannot survive without working on the identity of their apps. The identity expresses what the app is about to customers. However, it also projects an image of the role of the non-focal actor in the larger ecosystem. Such identity projection is relevant for managing the relationship with focal actors of the digital ecosystem. We outline and test three strategies for identity projection (identity conformity, identity differentiation, and identity refinement). Using panel data of social networking applications in the iOS appStore in China between 2014 and 2019, we investigate the influence of non-focal actors’ identity projection on their survival in digital ecosystems. Our result shows significantly increased app survival for those who actively pursue the identity projection strategies in three directions. Thus, we shed light on the role of platform identity in navigating platform competition in the digital age when participation across ecosystems becomes compulsory for every digital business

Unpacking platform business scaling in the digital age

Today’s increasingly pervasive digital technologies have radically transformed the competition landscape of the business world. To succeed in the digital age, digital businesses must establish and strengthen their ecosystem positions through rapid scaling. While extant literature in platform ecosystems identified the urgency of scaling for focal platforms, there is little recognition that non-focal actors (i.e., complementors) typically pursue their own growth ambitions. If successful, these ambitions may even shift the complementor’s position as a non-focal to a focal actor in the digital ecosystem. While such a scaling process opens new possibilities for the complementor, it also challenges its relations with focal platforms in the ecosystem on which it depends. This is what we refer to as the complementor’s dilemma: how can a non-focal actor pursue growth ambitions while maintaining favourable relationships with the focal platforms on which they grow? To address this research problem, a sequential mixed-method project combining qualitative research approaches with computational techniques was conducted. Developing on an in-depth embedded case study of the Chinese short video platform Douyin from its inception as a complementor in 2016 to its rapid establishment as a focal actor in 2018, we further test and generalise the findings for the entire social networking ecosystem in China. This allows for new empirical and theoretical perspectives on the navigation process of digital business scaling through identity projection. The findings suggest that non-focal businesses must continually locate and re-locate who they are in the moment and the trade-off of two, or multiple, future scenarios regarding their relationship with focal platforms, to cope with the complementor’s dilemma as they grow. Four identity projection strategies are further conceptualised as a powerful toolkit for balancing growth ambitions and dependency on other ecosystem actors during the scaling process. These findings contribute to the platform literature by offering a process model for non-focal businesses’ identity projection as they grow in digital ecosystems. The model offers important implications for our understanding of complementarity as a dynamic process involving purposeful identity re-projection, as non-focal businesses attempt to navigate tensions with focal platforms in digital ecosystems during growth. It also contributes to our understanding of digital business scaling beyond a high-growth consequence of firm size — a turbulent, uncertain, messy process to economies of complementarity in digital ecosystems

Going Digital First while Safeguarding the Physical Core: How an Automotive Incumbent Searches for Relevance in Disruptive Times

Incumbent firms typically face significant risk of losing the relevance of their physical core when facing industry disruption driven by digital technologies. Existing literature emphasizes a digital first approach, whereby firm offerings are fundamentally redeveloped from a digital point of view, from the point of conception. While this prescription can help accelerate innovation, it does not tell us how incumbents might safeguard the relevance of their traditional physical core resources when going digital first. This is important, since major discontinuities in strategic repositioning, while often celebrated in digital innovation and transformation literature, create significant risks to firm survival. To this end, we conduct a grounded analysis of a European automotive firm’s innovation journey over an eight-year period. We contribute to the digital innovation and transformation literature by developing a process model explaining how a digital first approach can be employed in a way that also safeguards the physical core

Growing through Platform Distinctiveness in Early Saturated Markets

High-growth ambitions are typically vital in platform markets. Yet, it is increasingly clear that the time window to occupy a novel platform market before it becomes saturated is surprisingly short. To this end, a differentiation strategy based on distinctive positioning across markets is increasingly prominent for new entrants to be competitive in early saturated markets. In the literature, two types of such tactics figure: (i) platform bundling, which aims to replicate the functionality of incumbents as part of a multimarket bundle, and (ii) platform piggybacking, which aims to tap into the functionality of incumbents through boundary resources use. In this paper, we employ a fixed-effect time series modelling approach using data from Apple’s App Store to develop and test the influence of these two tactics on platform competition in terms of user base and user engagement in early saturated app markets. We contribute to a distinctiveness logic of platform competitiveness by leveraging the dualism of digital platforms as both markets and technological architectures

Development strategy, viability, and economic institutions: The case of China

This paper explores the politically determined development objectives and the intrinsic logic of government intervention policies in east developed countries. It is argued that the distorted institutional structure in China and in many least developed countries, after the Second World War, can be largely explained by government adoption of inappropriate development strategies. Motivated by nation building, most least-developed countries, including the socialist countries, adopted a comparative advantage defying strategy to accelerate the growth of capital-intensive, advanced sectors in their countries. In the paper we also statistically measure the evolution of government development strategies and the economic institutions in China from 1950s to 1980s to show the co-existence and coevolution of government adoption of comparative advantage defying strategy and the trinity system