Digital business ecosystems : a comparison of different industries

Titelangaben

Götz, Franziska ; Buck, Christoph ; Rosemann, Michael ; Meckl, Reinhard:
Digital business ecosystems : a comparison of different industries.
In: Baumann, Sabine (Hrsg.): Handbook on Digital Business Ecosystems : Strategies, Platforms, Technologies, Governance and Societal Challenges. - Cheltenham, UK : Edward Elgar Publishing , 2022 . - S. 530-548
ISBN 978-1-83910-718-4
DOI: https://doi.org/10.4337/9781839107191.00043

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Abstract

Digitization boosts the reduction of communication, information, and transaction costs; on the other hand, it breaks down industry boundaries, connects companies from different industries, and changes the traditional structure of value creation (Remane et al., 2017). Companies can react flexibly and quickly to market changes by breaking industry boundaries and companies’ linkage from various sectors (Lingens et al., 2019). They gain rapid access to allocating complementary resources and competencies from other companies (Zahra and Nambisan, 2012). Thus, companies concentrate progressively on their core competencies and cooperate with other organizations with the necessary complementary resources. Horizontal and vertical networking, progressive co-specialization for the joint development of competitive value propositions, as well as ever-increasing interactions between companies, characterize these cooperations and change not only traditional industry structures but also conventional business models of companies (Pütz et al., 2019; Riasanow et al., 2020).
In this context, the literature refers to so-called digital business ecosystems (DBEs), which have become increasingly important in various industries and have gained increasing attention in business literature in recent years (Jacobides et al., 2018). Ecosystems are referred to as concepts of new value creation approaches (Adner and Kapoor, 2010). The formerly company-centered value chain is becoming more of a value-creating network of different partners (Lingens et al., 2019). Hence, companies no longer act merely as individual players but are part of an entire ecosystem (Bharadwaj et al., 2013). Although DBEs are gradually establishing themselves in almost all industries, they show different development speeds, integration depths, and maturity levels. These differences are due to each industry’s characteristics and markets, which differ, for example, in terms of government regulation, competitive structure, degree of digitization, technological intensity, depth of value added, or servitization.
Driven by digitization, private customers and companies are becoming increasingly intertwined (Riasanow et al., 2020). Due to the highly dynamic nature of DBEs (Götz et al., 2020), companies must continuously review their business model to react to changing conditions, anticipate future trends, and promote their innovations. The choice of the appropriate business model is becoming more complex due to novel value creation by DBEs, since traditional business models can no longer be applied (Adner and Kapoor, 2010). DBEs transform the environment into a self-organizing, interactive market in which cost-efficient digital services and value-creating activities occur (Chang and West, 2006).
Changing customer behavior and digitization are the two most vital factors driving this change, restructuring and changing any industry (Pousttchi and Dehnert, 2018). Prominent examples from industries, such as the entertainment, media, and retail sectors, show that there is no time to cling to traditional business models. There is a need to further develop the business model and include digital business models. One of the best-known examples is probably the demise of video stores, which have missed the opportunity to adapt their business models in digitization (for example, on-demand video streaming) and have thus been replaced by market participants such as Netflix (Smolinski et al., 2017). In this context, more and more companies are trying to set up or be part of DBE. So far, the literature on DBEs focuses on particular industries (Baggio and Del Chiappa, 2014; Tan et al., 2020), or case studies (Senyo et al., 2016; Tan et al., 2009), or particular aspects of the DBE (Briscoe and Sadedin, 2009; Namugenyi et al., 2019; Razavi, 2007). The question of how far different industries have progressed in developing DBEs remains unanswered. Hence, it is essential to know what challenges each industry faces and how to react to them. For this reason, this chapter addresses the following research question: How are companies from traditional industries in Germany dealing with the challenges of increasing digitalization and the resulting melting of industry boundaries regarding the development and implementation of DBEs?
Based on interviews with industry experts and case studies, we analyze and compare the development and implementation of DBEs from German companies across four different industries. Following the work of Riasanow et al. (2020, p. 4), we gathered data through conducting interviews in “substantially transforming” industries, including the automotive, banking and finance, and insurance industries. At the same time, the sporting goods sector serves as a vivid example for an industry with a high potential for the expansion of a DBE. The industries referred to in this chapter are all international industries. Characteristics of these industries are that the underlying market structure of the industry is internationally comparable. The remainder of this chapter is structured as follows. First, we present the theoretical background of DBEs. Next, we introduce the reader to each selected industry’s status regarding the current development of DBEs. Finally, we conclude the chapter with a discussion of the results as well as a conclusion, limitations, and further research.