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The influence of platform service innovation on value co-creation activities and the network effect

Wenhui Fu (China Europe International Business School, Shanghai, China)
Qiang Wang (School of Management, Xi’an Jiaotong University, Xi’an, China)
Xiande Zhao (China Europe International Business School, Shanghai, China)

Journal of Service Management

ISSN: 1757-5818

Article publication date: 18 April 2017

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Abstract

Purpose

The purpose of this paper is to explore the properties of platform service innovation and its relationship to value co-creation activities and the network effect. This is done over the course of a platform’s evolution through three stages: emergence, expansion and maturity.

Design/methodology/approach

Based on grounded theory, this study adopts a multiple case study research design. An in-depth analysis of the case data is done using ATLAS.TI software.

Findings

At the emergence stage, platform service innovations focus on building infrastructure. Platform owners stimulate the network effect directly via platform service innovations, rather than indirectly via value co-creation activities. At the expansion stage, the platform service innovations focus on building relationships among platform owner and different sides of participants. Platform owners stimulate the network effect indirectly, via value co-creation activities, rather than directly via platform service innovations. At the maturity stage, platform service innovations focus on building an environment for the platform ecosystem. Platform owners stimulate the network effect indirectly, via value co-creation activities rather than directly.

Originality/value

This research contributes to the service innovation literature by exploring the properties of platform service innovation and its relationship to value co-creation activities and the network effect from a longitudinal perspective. The principal managerial implication is that platform managers need to consider the developmental stage of the platform, as a mismatching of stage of development (emergence/expansion/maturity) and focus (an orientation toward building infrastructure, relationships or environment) may lead to a failure to stimulate or enhance the network effect.

Keywords

Acknowledgements

This research was supported by National Natural Science Foundation of China (71602159, 71090403/71090400, 71420107024).

Citation

Fu, W., Wang, Q. and Zhao, X. (2017), "The influence of platform service innovation on value co-creation activities and the network effect", Journal of Service Management, Vol. 28 No. 2, pp. 348-388. https://doi.org/10.1108/JOSM-10-2015-0347

Publisher

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Emerald Publishing Limited

Copyright © 2017, Emerald Publishing Limited