Outline

The thesis comprises an introduction and six individual, complementary publications. The introduction is organized as follows. Following the discussion on the purpose of the study, and the identification of research gaps and research questions in the first chapter, the second chapter describes and justifies the ontological, epistemological, and methodological choices, and adopted reasoning logics of the dissertation. In addition, the second chapter includes an illustration of the utilized vehicle to build theory, the multiple‐lens perspective. The third chapter introduces and reviews three different conceptions of ecosystem architecture and synthesizes these to develop a framework of the structural properties and design dimensions of ecosystem architecture. The fourth chapter illustrates a summary of the publications and a review of the results. Finally, the fifth chapter closes by answering the research questions, by providing suggestions regarding the collective value creation potential of the ecosystem and individual value capture potential of a particular actor firm and by commenting upon the implications, limitations, and suggestions for further research.

21 2 RESEARCH DESIGN

The three cornerstones of research are theory, method and the empirical phenomena. The purpose of this chapter is to firstly, describe, discuss, and justify the choice of the philosophy underlying the scientific practice of this dissertation. The ontological assumptions and epistemological stance of the study are introduced which have guided the theoretical and empirical work. Secondly, this chapter introduces the multiple‐lens perspective as a vehicle to build the theoretical framework.

Thirdly, the methods of inquiry are introduced with a description of the data collection and analysis methods applied in each publication.

2.1 Ontology, epistemology and methodology

The philosophy of science, which informs us about the nature of the phenomenon examined and the methods for understanding it, underlies all forms of research. Understanding the implication of this choice is integral for any reflective and responsible scientific inquiry (Bechara & Van de Ven, 2007).

Too often, this choice is described only in terms of methods, and not in terms of ontology, epistemology, and methodology. The inquirer and the ontological and epistemological foundations of research are guided by a paradigm, which refers to the basic belief system of worldview (Greene, 2007). The inquiry paradigm defines the ontological questions (what is the form and nature of reality); the epistemological questions (what is the nature of the relationship between the knower and would‐be knower and what can be known); and the methodological questions (how can the inquirer go about finding out whatever they believe can be known), thus leaving the questions of methods secondary to questions of paradigms (Guba & Lincoln, 1994).

The historical and epistemological foundations of organization theory are grounded in integrating sociological theory with engineering discourse (Shenhav, 2003). This statement already implies that researchers in the field of organization and management studies subscribe to different inquiry paradigms. This was especially highlighted in the beginning of the 1990s and during the raging paradigm war between organization positivists or realists (Pfeffer 1982; Pfeffer 1993; Pfeffer 1995;

Donaldson 1985, 1996; Bacharach 1989), and constructivists (Lincoln 1985; Lincoln & Guba 1985;

Reed & Hughes 1992; Perrow, 1994; Van Maanen 1995; Alvesson & Deetz, 1996; Burrell 1996; Chia 1996).

Most typically, scholars in the field of organization and management science are categorized as positivists or constructivists. The former is said to have a “hypothetico‐deductive, particularistic, objective, outcome‐oriented, and natural science world view” and the latter is said to “subscribe to phenomenological, inductive, holistic, subjective, process‐oriented, and social anthropological world view” (Reichardt & Cook, 1979, p. 9‐10). Moving beyond the dichotomy, scholars such as Burrel and Morgan (1979) and Deetz (1996) have offered more detailed categorizations of paradigms and today, the field of organization science can be characterized as positive, interpretive, critical or postmodern science (Donaldson, 2003; Hatch & Yanow, 2003; Willmott, 2003; Chia, 2003; Hatch & Cunliffe, 2006).

The epistemological and ontological foundations of this study represent the post‐positivist paradigm. The ontological foundation of post‐positivism utilizes critical realism (Guba & Lincoln, 1994) or Campbellian realism (McKelvey, 1997). Both critical realism and Campbellian realism assumes realist ontology. The ontological problem that scholars in the field of organization and management science face is that most of the time we are simultaneously trying to accept the existence of idiosyncratic events and still pursuing the essential elements of justification logic

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which requires non‐idiosyncratic events (Hempel, 1965; Suppe, 1977; McKelvey, 1997). As idiosyncrasy will not disappear, prediction, generalization, and falsification cannot take place. In effect, we are wearing a normal science straightjacket (Daft & Lewin, 1990). Thus, this dissertation subscribes to Campbellian realism, which allows social scientists to accept real‐world phenomena as criterion variables against which theories may be tested without denying the reality of individual interpretation and social construction (McKelvey, 1997). Put in other words, there is “real” reality out there but only imperfectly and probabilistically apprehendable (Guba & Lincoln, 1994); a critical realist is critical of the ability to know reality with certainty. The epistemological foundation of post‐positivism and this study is modified objectivism, meaning that the notion of complete distinction between the investigation and the phenomenon being investigated is not required.

Organization theory as a positive science aims at producing theories which explain how the world works (rather than being normative) and explanation takes place primarily in terms of causes that determine effects (Donaldson, 2001). Furthermore, the theory building and knowledge accumulation of the post‐positivist paradigm is based on the accretion of and addition to the edifice of knowledge (Guba & Lincoln, 2005). The following section explains the multiple‐lens perspective, which was adopted in the attempt to synthetize the relevant literature, the design of the overall research process and the research process of individual publication, all of which have been guided by the post‐positivist paradigm.

2.2 Multiple‐lens perspective

The name of organization theory suggests that there is a single, integrated, and overarching explanation what comes to the existence of organizations and organizing in general (Hatch &

Cunliffe, 2006). This might have been the case during the early years of organization theory (from the beginning of 1960s to mid‐1970s) when the field was characterized by a relatively high degree of consensus. In the early 1990s, the first concerns about knowledge fragmentation in the field of organization and management studies were raised. During the so‐called paradigm wars, Pfeffer (1993) was among the first to argue that due to scholarly specialization, knowledge creation tends to take place in silos (Pfeffer, 1993), leading to “Towers of Babel” (for opposing arguments and responses to Pfeffer (1993), see for example Cannella & Paetzold (1994), Perrow (1994), and Van Maanen (1995)). Ever since, scholars have drawn increasing attention to this danger which may limit the development of organization and management studies as a field (Pfeffer, 1993; Burrell, 1996; Okhuysen & Bonardi, 2011). Stated by McKinley et al. (1999, p. 643), “even a brief review of contemporary organization theory suggests that the discipline is composed of multiple, largely incommensurable theoretical frameworks or schools of thought”. Much of this holds true still today.

The pluralism in theories has been explained with various reasons, the most common one being the newness of the field. As many of the paradigms are quite recent, time is needed “for the weight of incremental refutations to finally scuttle strongly entrenched claims, paradigms, or schools”

(McKelvey, 1997, p. 354). Further (McKelvey, 1997) explains that there is reason to believe that the testability criterion has failed in organization science for two reasons: 1) prediction, falsification, and generalization do not work with organizational phenomena because much of it is idiosyncratic, and 2) subjectivist thinking is increasingly prevalent. In addition, pluralism has been explained with the presence of theory‐building approaches, such as borrowing and blending. As organization theory is an inter‐disciplinary field, having its roots in sociology, in the improvement of management control over work processes, and in economics (Fligstein, 2001), the scholars of this discipline are accustomed of borrowing and applying concepts and theories from its underlying disciplines. Whetten et al. (2009) distinguish between two types of borrowing: vertical and horizontal borrowing. Vertical, cross‐level borrowing refers to application of concepts and theories

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within one discipline but on a different unit of analysis, whereas horizontal, cross‐context borrowing refers to the application of concepts and theories from one discipline to another.

More recently, McKinley (2010) discussed the trend of migrating from theory validation to new theory development, calling this the displacement of ends. Further, McKinley et al. (2011) label this as low heed in organization theory. They argue that organization theory operates as a low heed discipline, in which scholars take minimal heed of the contributions of their fellows. This condition of low heed is revealed in several specific aspects of the discipline: lack of attention to testing previously published theories, lack of emphasis on the replication of published empirical research, low standardization of construct definition and measurement, and a minimally‐developed division of labour between theorists and empirical researchers.

In an attempt to elevate the heed in organization theory, this dissertation adopts an integrative perspective in building the theoretical framework with an aim to create a comprehensive approach to ecosystem architecture. The literature on inter‐organizational design issues has been growing in recent years with few signs of convergence. The vehicle to build the ecosystem architecture concept is to combine lenses to build theory. This multiple‐lens perspective produces synthetized coherence by citing and drawing connections between works and investigative streams not typically cited together to suggest the existence of undeveloped research areas (for a further discussion on the textual acts and rhetorical practices to construct synthetized coherence, see Locke & Golden‐Biddle (1997)). The aims of such an approach are: 1) to bring attention to, and invent or reinvent as topics for inquiry, subjects that are implicit in other works, 2) synthetize recent advances and ideas into fresh theory, 3) to integrate theories or theoretical perspectives to provide a theoretical structure that was not there before, and 4) to clarify a central construct and to position the construct within a constellation of antecedents and outcomes in ways that not only generate communication among scholars but also spark research aimed at resolving the theoretical puzzles and empirical questions illuminated in the study (Gioia & Pitre, 1990; Locke & Golden‐Biddle, 1997; LePine & King, 2010;

Okhuysen & Bonardi, 2011).

Okhuysen and Bonardi (2011) discuss the different types of multiple‐lens perspectives in more detail. According to their definition and in order to build theory, different theoretical lenses are combined. These theories can be either compatible or incompatible in regard to their underlying assumptions, and they can either address substantially similar (or even the same) phenomena or different ones. More specifically, the degree of compatibility between the underlying assumptions of the lenses being combined is “the degree to which the theories brought together rely on similar or dissimilar individual decision‐making processes, organizational mechanisms, or other properties in the development of their explanations” (ibid., p. 7). The other dimension, the proximity of the theoretical lenses which are combined, refers to “the conceptual distance that exists between the phenomena that the lenses address in their original conception” (ibid., p. 7). Based on the degree of compatibility and proximity Okhuysen and Bonardi (2011) establish four different types of multiple‐lens perspectives, illustrated in Figure 1.

24 Figure 1: Different types of multiple‐lens perspective

Multiple‐lens perspective builds upon the argument that the use of any single research paradigm produces too narrow a view to reflect the multifaceted nature of organizational reality (Burrell &

Morgan, 1979; Gioia & Pitre, 1990). This perspective helps organization theory to step away from mere borrowing (Oswick et al., 2011) to highlight areas of overlap or complementarity for example (Okhuysen & Bonardi, 2011). In the identified conceptions, the boundary conception of ecosystem architecture itself has elements of this theory‐building approach. When building transaction cost economics, Williamson (1985) combined the lenses of economic changes (Hayek, 1945), governance (Barnard, 1938), bounded rationality (Simon, 1957), and institutional perspective (Commons, 1932) thus establishing an interdisciplinary research project in which law, economics, and organization theory are joined. This, in terms of Whetten et al. (2009), represents horizontal, cross‐context borrowing. Given the recent advancements in the theoretical underpinnings of this study, vertical, cross‐level borrowing is also witnessed in both the boundary concept and design concept more from firm‐level analysis to ecosystem or meta‐organization level.

Feyerabend (1980, p. 47) pointed out that “a scientist who is interested in maximal empirical content, and who wants to understand as many aspects of [his or her] theory as possible, will accordingly adopt a pluralistic methodology, [he or she] will compare theories with other theories . . . and [he or she] will try to improve rather than discard the views that appear to be lost in the competition”. As researchers from different disciplines generally use different methods and have different interests toward their object of study, approaches such as the multiple‐lens perspective allow them to see things that might not be recognized or might appear inconsequential to an insider (Carlile & Christensen, 2004). Further examples of such efforts include Porter’s (1980) work on strategy by combining business policy and industrial organization economics and Baldwin and

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Clark’s (2006) work on modularity by combining options theory from finance and studies on product development.

In order to enhance the understanding of ecosystem architecture design, the suggested explanation builds upon organization design, sociologically‐rooted network theory, and economics, varying significantly in their proximity. However, the underlying assumptions of the lenses are compatible, implying a fit between the selected lenses to combine. Thus this integrative attempt to provide a new theoretical structure represents the type I multiple‐lens perspective. Focusing explicitly on these three conceptions may entail the exclusion of some potentially applicable theories. For example, from the economics side, literature on industrial organization has recently paid much attention to near‐by phenomenon, and two‐ or multi‐sided markets (Evans, 2003; Evans &

Schmalensee, 2007). This stream of industrial organization literature was utilized in publications I, II, V and VI. However, as the abductive interplay between theory and empirical observations progressed, it was noted that the excessive focus on the nature of the context and pricing as the key to encourage access and adoption of particular ecosystem (Gawer & Cusumano, 2012) and only vague explanations of the structural characteristics of an ecosystem led to the exclusion of the industrial organization perspective from the final framework. Similar arguments can be made about a second supplement of transaction cost economics, the property rights theory and incomplete contracting. Thus, the transaction‐cost‐economics‐(and evolutionary economics)‐based ecosystem architecture explanation was chosen.

In addition, perspectives such as organizational ecology (Okoli, 2007), value networks (Allee, 2000;

Kathandaraman & Wilson, 2001), and the applications of financial portfolio theory on the examination of inter‐organizational arrangements (Chandra & Shadel, 2007; Srivastava & Gnyawali, 2011) were excluded. Exclusion of some perspectives and justification of the selection is based on the purpose of the study to understand the actor‐structure duality, the structural properties of the architecture and the processes to manage and design the properties. The individual conceptions and their contributions are discussed in the sections 3.1 – 3.3. Further, section 3.4 presents a synthesis of the conceptions and discusses the implications of the conception for value creation and appropriation.

2.3 Reasoning and methods

How tempting would it to be to describe the research process in the following linear and sequential way: a problem was identified that is of interest to the research community, specific research questions or hypotheses were formulated relying on the theoretical resources of the research community, appropriate research strategies based on either or both deductive or inductive logic were elaborated, qualitative or quantitative measures were chosen and put to work, data compilation and analysis followed, and, with pluck and luck, plausible (or verifiable) inferences and conclusions resulted; end of story (Van Maanen et al., 2007). Van Maanen et al. (2007, p. 1146) point out that matters of how the actual research process proceeded are rarely discussed (at least in print) since in reality:

the flow on research is lengthy and uneven, is seen most clearly in hindsight, and perhaps most important, is contextually idiosyncratic, often chaotic, and always personal; how we arrive to conclusions is difficult to penetrate when publication norms do not favour the presentation of results in the manner in which they evolved and when the personal history of how the research process unfolded over time may be revised or forgotten as the project moves toward its final printed version.

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The ironic description of the research process illustrates the overly simplified and idealized version of the interplay between theory and data which serves as the general form of representation of the results in academic writing (Van Maanen et al., 2007). Luckily, inch by inch the cognitive limitations of researchers are being incorporated into the discussion regarding the process of doing research (Alvesson & Kärreman, 2007; Van Maanen et al., 2007) and reasoning (Mantere & Ketokivi, 2013).

The interplay of theory and data does not usually follow this prescribed, almost magical, sequence (Van Maanen et al., 2007); it is more a sense‐making venture that evolves over time (Bailyn, 1977;

Weick, 1989; Alvesson & Kärreman, 2007).

Regarding the abductive reasoning logic of the dissertation entity, the following notions on the interplay of theoretical and empirical observations are in order. Understanding on the variation in ecosystem architecture was sought against the theoretical backgrounds of two‐sided markets, value co‐creation, and business models. For example, before turning to industry architecture literature, explanation about the phenomenon was sought from literature on industrial organization and two‐

sided markets (see publications I, II, V and VI). Further, in order to explain how and upon which template a firm organizes its transactions with suppliers, complementors and customers, explanation was sought from business model literature (see publications II and IV) before turning to literature on meta‐organization design. The theoretical explanations from two‐sided markets, value co‐creation, and business models literature were not seen as comprehensive enough to address the phenomenon of interest and thus they were excluded.

The research design of the overall dissertation and the individual publications is depicted in Figure 2, illustrating the different reasoning logics and related methodologies. In addition to this introductory part, the dissertation comprises six separate publications, each focusing on different aspects concerning the subject under scrutiny.

27 Figure 2: Research design of the dissertation

The essence of an argument is to proceed from premises to conclusions in a credible manner and to defend the claims made in these conclusions (Toulmin, 2003). In order to bridge premises with conclusions, scholars as scientist use various reasoning principles (Mantere & Ketokivi, 2013), namely deduction, induction and abduction. Mantere and Ketokivi (2013) explain the difference between deduction, induction and abduction in the following way. For deductive reasoning, the rule and the explanation are the premises and based on these, the observation is derived. Thus a conclusion about the particular is drawn based on the general. For inductive reasoning, the observation and the explanation are the premises and based on these, the rule is derived. Thus conclusion is drawn from particular to general. For abductive reasoning, the rule and the observation are the premises and based on these, the explanation is inferred if it accounts for the observation in light of the rule.

As depicted in the figure above, the overall research design can be characterized as interplay; the theoretical framework evolved simultaneously and interactively with empirical research (Dubois &

Gadde, 2002; Van Maanen et al., 2007; Dubois & Gibbert, 2010). As labelling the research deductive, inductive, or abductive does not by itself tell how the research process proceeded nor justify the methodological choices (Eriksson & Kovalainen, 2008), Table 1 further summarizes more precisely the research design adopted in complementary publications of the dissertation in terms of reasoning logics, methods and analysis, and the data used in the publications. The characteristics of

Gadde, 2002; Van Maanen et al., 2007; Dubois & Gibbert, 2010). As labelling the research deductive, inductive, or abductive does not by itself tell how the research process proceeded nor justify the methodological choices (Eriksson & Kovalainen, 2008), Table 1 further summarizes more precisely the research design adopted in complementary publications of the dissertation in terms of reasoning logics, methods and analysis, and the data used in the publications. The characteristics of