Showing papers in "Electronic Markets in 2019"
TL;DR: It is concluded that smart service systems are characterized by technology-mediated, continuous, and routinized interactions.
Abstract: Recent years have seen the emergence of physical products that are digitally networked with other products and with information systems to enable complex business scenarios in manufacturing, mobility, or healthcare. These “smart products”, which enable the co-creation of “smart service” that is based on monitoring, optimization, remote control, and autonomous adaptation of products, profoundly transform service systems into what we call “smart service systems”. In a multi-method study that includes conceptual research and qualitative data from in-depth interviews, we conceptualize “smart service” and “smart service systems” based on using smart products as boundary objects that integrate service consumers’ and service providers’ resources and activities. Smart products allow both actors to retrieve and to analyze aggregated field evidence and to adapt service systems based on contextual data. We discuss the implications that the introduction of smart service systems have for foundational concepts of service science and conclude that smart service systems are characterized by technology-mediated, continuous, and routinized interactions.
223 citations
TL;DR: A multiple case study in the context of emerging Internet of things (IoT) platforms highlights that B2B platforms follow three standardized value co-creation practices, showing how platforms leverage different boundary resources in a process of standardization to develop a scalable infrastructure.
Abstract: Moving beyond value creation in individual companies, firms have integrated customers, partners, and stakeholders in a mutual value co-creation process. Examples are platforms such as Apple’s App Store, where external developers use boundary resources provided on the platform to develop and share applications in an ecosystem. While value co-creation on business-to-consumer platforms is common practice, research on their business-to-business (B2B) counterparts is still sparse. The goal of this paper is to analyze how B2B platforms utilize value co-creation practices. We conduct a multiple case study in the context of emerging Internet of things (IoT) platforms highlighting that B2B platforms follow three standardized value co-creation practices. The platform encourages the supply side through the (1) integration of complementary assets, the demand-side through (2) ensuring platform readiness and connects both processes by (3) servitization through application enablement. We conclude by showing how platforms leverage different boundary resources in a process of standardization to develop a scalable infrastructure that explains how platforms enable value co-creation within their ecosystem.
163 citations
TL;DR: The results of the case study suggest that different evolutionary paths can be pursued during the early stages of an MSP’s lifecycle, and advances the body of scientific knowledge with regard to data being a boundary resource on MSPs.
Abstract: The paper presents the findings from a 3-year single-case study conducted in connection with the International Data Spaces (IDS) initiative. The IDS represents a multi-sided platform (MSP) for secure and trusted data exchange, which is governed by an institutionalized alliance of different stakeholder organizations. The paper delivers insights gained during the early stages of the platform’s lifecycle (i.e. the platform design process). More specifically, it provides answers to three research questions, namely how alliance-driven MSPs come into existence and evolve, how different stakeholder groups use certain governance mechanisms during the platform design process, and how this process is influenced by regulatory instruments. By contrasting the case of an alliance-driven MSP with the more common approach of the keystone-driven MSP, the results of the case study suggest that different evolutionary paths can be pursued during the early stages of an MSP’s lifecycle. Furthermore, the IDS initiative considers trust and data sovereignty more relevant regulatory instruments compared to pricing, for example. Finally, the study advances the body of scientific knowledge with regard to data being a boundary resource on MSPs.
88 citations
57 citations
TL;DR: This work proposes a research model to explain crowdfunding success considering success factors and their interrelations and reveals that not only the factors themselves but also their inter Relations are important to explain funding success.
Abstract: Online crowdfunding websites are multi-sided platforms that offer project founders the possibility to publish their project ideas, to address potential investors, and to ask for funding. The successful funding of crowdfunding campaigns is important for founders, investors, platform operators, and diverse interest groups as well. As a consequence, research has already shed light on some success factors of crowdfunding campaigns, but the interrelations between the success factors have been neglected so far. Building upon previous research in the field of crowdfunding, investment decision making, and signaling theory, we propose a research model to explain crowdfunding success considering success factors and their interrelations. Our findings reveal that not only the factors themselves but also their interrelations are important to explain funding success. Our results are highly relevant for the stakeholders on crowdfunding platforms in order to prepare and identify successful project proposals.
56 citations
TL;DR: A structured literature search in which 109 relevant publications were identified shows that there is diverse knowledge related to the various topics associated with smart services and suggests that economic aspects such as new business models or pricing strategies are rarely considered in the literature.
Abstract: Smart services serve customers and their individual, continuously changing needs; information and communications technology enables such services. The interactions between customers and service providers form the basis for co-created value. A growing interest in smart services has been reported in the literature in recent years. However, a categorization of the literature and relevant research fields is still missing. This article presents a structured literature search in which 109 relevant publications were identified. The publications are clustered in 13 topics and across five phases of the lifecycle of a smart service. The status quo is analyzed, and a heat map is created that graphically shows the research intensity in various dimensions. The results show that there is diverse knowledge related to the various topics associated with smart services. One finding suggests that economic aspects such as new business models or pricing strategies are rarely considered in the literature. Additionally, the customer plays a minor role in IS publications. Machine learning and knowledge management are identified as promising fields that should be the focus of further research and practical applications. Concrete ideas for future research are presented and discussed and will contribute to academic knowledge. Addressing the identified research gaps can help practitioners successfully provide smart services.
56 citations
TL;DR: This study provides prescriptive knowledge for HI-DSS and contributes to previous work on decision support for business models, the applications of complementary strengths of humans and machines for making decisions, and support systems for extremely uncertain decision-making problems.
Abstract: One of the most critical tasks for startups is to validate their business model. Therefore, entrepreneurs try to collect information such as feedback from other actors to assess the validity of their assumptions and make decisions. However, previous work on decisional guidance for business model validation provides no solution for the highly uncertain and complex context of early-stage startups. The purpose of this paper is, thus, to develop design principles for a Hybrid Intelligence decision support system (HI-DSS) that combines the complementary capabilities of human and machine intelligence. We follow a design science research approach to design a prototype artifact and a set of design principles. Our study provides prescriptive knowledge for HI-DSS and contributes to previous work on decision support for business models, the applications of complementary strengths of humans and machines for making decisions, and support systems for extremely uncertain decision-making problems.
54 citations
TL;DR: A comprehensive taxonomy that identifies 43 characteristic functions of software-based business model development tools is provided, and a classification of existing software tools for the taxonomy is provided to support practitioners’ decision making on tool (re-)design and investment.
Abstract: Software tools for business model development hold great promise for supporting business model innovation, but nonetheless, virtually no design-relevant knowledge exists concerning the functions that such tools should possess. As a result, practitioners lack guidance for choosing software tools, and researchers lack a foundation for advancing knowledge on these tools in a cumulative way. To address these issues, we synthesize knowledge from research on software tools for business model development and adjacent fields with the results of an analysis of 24 software tools from practice. Our contribution is threefold. First, we provide a comprehensive taxonomy that identifies 43 characteristic functions of software-based business model development tools. Second, we provide a classification of existing software tools for the taxonomy and, on this basis, third, we derive an agenda for future research. We thus support practitioners’ decision making on tool (re-)design and investment, and provide the foundation for a cumulative stream of research on software tools for business model development.
52 citations
TL;DR: The resulting process model shows that MSPs follow a process of sense-making and bricolage to assemble a service-oriented architecture, contrary to the incumbent who adopts technologies according to its institutional logic to improve existing products and processes.
Abstract: Multi-sided platforms (MSPs) are one of the dominant designs of the digital age. However, prior research focuses mainly on established MSPs, leaving little insight into their emergence. We use the literature on technological trajectories and technology diffusion to derive four propositions that increase our understanding on the emergence of MSPs. The propositions include the emergence of native MSPs based on the assimilation of technologies in technological trajectories; how uncertainty influences incumbents to not follow those trajectories; how native MSPs create new demand; and how this demand eventually triggers the transformation process of incumbents to transform toward an MSP provider. We conduct a multiple-case study in the context of mobility services with three native MSP companies along with an incumbent that is transforming toward an MSP provider. The resulting process model shows that MSPs follow a process of sense-making and bricolage to assemble a service-oriented architecture, contrary to the incumbent who adopts technologies according to its institutional logic to improve existing products and processes.
51 citations
TL;DR: This study guides the design of DVNs through employing service-dominant logic, a theoretical lens that conceptualizes value co-creation as well as business environments, and derives design requirements and design principles for DVNs and discusses how these design principles can be illustrated by expository design features for DVN.
Abstract: Information systems (IS) increasingly expand actor-to-actor networks beyond their temporal, organizational, and spatial boundaries. In such networks and through digital technology, IS enable distributed economic and social actors to not only exchange but also integrate their resources in materializing value co-creation processes. To account for such IS-enabled value co-creation processes in multi-actor settings, this research gives rise to the phenomenon of digital value co-creation networks (DVNs). In designing DVNs, it is not only necessary to consider underpinning value co-creation processes, but also the characteristics of the business environments in which DVNs evolve. To this end, our study guides the design of DVNs through employing service-dominant logic, a theoretical lens that conceptualizes value co-creation as well as business environments. Through an iterative research process, this study derives design requirements and design principles for DVNs, and eventually discusses how these design principles can be illustrated by expository design features for DVNs.
49 citations
TL;DR: The results show that current privacy risk factors dominate the perceived value of an individual to use PAYL services, and insurance companies, service providers and manufacturers of wearables must primarily work together and offer solutions for greater data security and data protection before focusing on gamification and functional congruence.
Abstract: The recent boom in wearable technologies generates enormous vital data sets, which are the ideal starting point for new service offers by Big Data Analytics. In a Pay-As-You-Live (PAYL) service, insured track activities, transfer current data on the lifestyles of users, who receive rewards from their insurance companies. The aim of this study is to investigate the readiness of customers to adopt PAYL services using wearable technology by comparing perceived privacy risks and perceived benefits. The research model is developed on a basis of a literature review and expert interviews. By conducting an online survey involving 353 participants, a structural equation modelling approach is used to test the research model. The results show that current privacy risk factors dominate the perceived value of an individual to use PAYL services. Insurance companies, service providers and manufacturers of wearables must therefore primarily work together and offer solutions for greater data security and data protection before focusing on gamification and functional congruence.
TL;DR: This paper proposes a fractional variant of the standard SGD, named as fractional stochastic gradient descent (FSGD), for recommender systems, and examines that the proposed strategy is more accurate in terms of RMSE than the standardSGD for all values of fractional orders and different numbers of features.
Abstract: Recently, recommender systems are getting popular in the e-commerce industry for retrieving and recommending most relevant information about items for users from large amounts of data. Different stochastic gradient descent (SGD) based adaptive strategies have been proposed to make recommendations more precise and efficient. In this paper, we propose a fractional variant of the standard SGD, named as fractional stochastic gradient descent (FSGD), for recommender systems. We compare its convergence and estimated accuracy with standard SGD against a number of features with different learning rates and fractional orders. The performance of our proposed method is evaluated using the root mean square error (RMSE) as a quantitative evaluation measure. We examine that the proposed strategy is more accurate in terms of RMSE than the standard SGD for all values of fractional orders and different numbers of features. The contribution of fractional calculus has not been explored yet to solve the recommender systems problem; therefore, we exploit FSGD for solving this problem. The results show that our proposed method performs significantly well in terms of estimated accuracy and convergence as compared to the standard SGD.
TL;DR: This study of five cases inside BMW assesses the usefulness of System Dynamics along the different phases of business model innovation processes and develops a set of 11 propositions that represents the core of the theoretical insights.
Abstract: Business model innovation is a process that allows firms to build and maintain competitive advantages. However, it imposes major challenges to managers who rely on incomplete cognitive representations while attempting to understand the environmental dynamics that determine a business model’s prospective performance. System Dynamics is a computational approach potentially useful in enhancing managerial understanding and decision-making during business model innovation, yet its effects lack sound empirical evidence. This study of five cases inside BMW assesses the usefulness of System Dynamics along the different phases of business model innovation processes. In order to develop a nuanced understanding we triangulate insights from the multiple-case study approach with results from a Q-Sort exercise. Our emergent theory highlights that System Dynamics enables managers to develop more accurate cognitive representations about their business models. Unexpectedly, we find that this process leads to a cognition gap apparent in the communication with managers not involved in the modelling process. We observe two strategies to overcome this gap. A second key insight is that System Dynamics has a tendency to consolidate mental models by different managers that need to be managed cautiously. We develop a set of 11 propositions that represents the core of our theoretical insights.
TL;DR: Investigating user online browsing and purchasing behaviors, and predicts purchasing actions during a large shopping festival in China, and applies collaborative filtering based method to recommend items for different consumers, and predict whether purchase will happen.
Abstract: This work investigates user online browsing and purchasing behaviors, and predicts purchasing actions during a large shopping festival in China To improve online shopping experience for consumers, increase sales for merchants and achieve effective warehousing and delivery, we first analyse diverse online shopping behaviours based on the 31 million logs generated accompanied with online shopping during a rushed sale event on 11st November, 2016 Based on the obtained user behaviours and massive data, we apply collaborative filtering based method to recommend items for different consumers, and predict whether purchase will happen We conduct 5-fold cross validation to evaluate the collaborative filtering based recommendation method, and further identify the critical shopping behaviors that determine the precursors of purchases As online shopping becomes a global phenomenon, findings in this study have implications on both shopping experience and sales enhancement
TL;DR: The concept of customer-induced service orchestration and management shall empower customers to combine services from multiple service providers in order to address their problems in a transparent and white-box way.
Abstract: This position paper acknowledges that customer orientation is a key requirement for companies to be competitive in the marketplace. Customer orientation has led to concepts, such as personalization, one-to-one-marketing, mass customization and co-creation, which all strive for a strong alignment of individual customer demands and encounters with a company’s offerings. Despite the customer is increasingly regarded as an active partner, the overall perspective of customer orientation is still mainly provider-oriented. Adopting the perspective of customers, as argued in this position paper, would help recognizing that customer problems are often broader and more complex than the solutions of single providers. While intermediaries and, more recently, assistants based on artificial intelligence, have emerged to address this demand, their approaches are typically little transparent and follow a black-box paradigm. Using examples from multiple application domains, this position paper proposes elements that need to be addressed to overcome these shortcomings. The concept of customer-induced service orchestration and management shall empower customers to combine services from multiple service providers in order to address their problems in a transparent and white-box way. This approach could represent an important next step in customer orientation.
TL;DR: It appears to be beneficial to provide interdisciplinary teams a tool-based support for the design and evaluation of smart services, and the proposed tool provides benefits, especially in structuring the task for project teams.
Abstract: The emergence of data-driven services in the Internet of Things provides manufacturers of technical products the opportunity to become providers of services, which use data as primary input. The development of such smart services, however, is characterized by high complexity and uncertainty. To identify service ideas which are worth to pursue further, the potential financial impact is an important criterion. While the importance of a business case is acknowledged in service engineering, there is currently no concrete method that is integrated with the early design phases of smart services. Therefore, we propose a tool-based method for the design-integrated financial assessment of smart services. We use a design science research approach to develop a meta-model, which is implemented in a web-based tool. The experimental evaluation shows that the proposed tool provides benefits, especially in structuring the task for project teams. Therefore, it appears to be beneficial to provide interdisciplinary teams a tool-based support for the design and evaluation of smart services.
TL;DR: The holistic architecture of these systems is described and the main enablers underlying the development of SESs in terms of internet of things, social media, mobile internet, big data analytics and cloud computing are analyzed.
Abstract: With the ongoing progress in cloud computing, big data analytics (BDA) and other burgeoning technologies, the integration of intelligence and e-commerce systems now makes it possible to build e-commerce systems with enhanced efficiency, reduced transaction costs and smart information-processing patterns. However, despite the fact that smart e-commerce systems (SESs) offer great opportunities to the business field, the development of SESs is still in its infancy. Numerous issues still need to be resolved. To offer a better comprehension of SESs and facilitate future research, this paper first describes the holistic architecture of these systems and analyzes the main enablers underlying the development of SESs in terms of internet of things (IoT), social media, mobile internet, big data analytics and cloud computing. Then, the key challenges and issues pertaining to current SESs are presented, and some possible research directions are also proposed. Finally, the paper presents qualitative and quantitative depictions of SESs from a complex systems perspective, which provides a brand new idea of how to address the current SES issues.
TL;DR: The results indicate increased comprehension of data processing practices when privacy policies are transparently disclosed, whereas acceptance rates do not vary significantly.
Abstract: Smart devices provide unprecedented access to users’ personal information, on which businesses capitalize to offer personalized services. Although users must grant permission before their personal information is shared, they often do so without knowing the consequences of their decision. Based on the EU General Data Protection Regulation, which mandates service providers to comprehensively inform users about the purpose and terms of personal data processing, this article examines how increased transparency regarding personal data processing practices in mobile permission requests impact users in making informed decisions. We conducted an online experiment with 307 participants to test the effect of transparency on users’ decisions about and comprehension of the requested permission. The results indicate increased comprehension of data processing practices when privacy policies are transparently disclosed, whereas acceptance rates do not vary significantly. We condense our findings into principles that service providers can apply to design privacy-transparent mobile apps.
TL;DR: This research examines the effect of buyers’ uncertainty perceptions on SCA behaviour, and prescribes the ways to mitigate them, and identifies seller uncertainty, description uncertainty, and performance uncertainty as the key antecedents of SCA.
Abstract: Shopping cart abandonment (SCA) is the phenomenon whereby an online buyer places items into her virtual shopping cart but eventually chooses to abandon payment. This research examines the effect of buyers’ uncertainty perceptions on SCA behaviour, and prescribes the ways to mitigate them. Building on the e-commerce literature, we identify seller uncertainty, description uncertainty, and performance uncertainty as the key antecedents of SCA and explore their relative influences on customers’ intention to finalize the transaction. Drawing upon uncertainty reduction theory (URT) from the communication literature, we theorize critical communication capabilities and discuss their relative effectiveness and boundary conditions in reducing different types of uncertainty perceptions. Survey data were collected from 237 online shoppers who were hesitating to checkout items in their virtual shopping carts. The results provide support for our structural model and hypotheses in general, with a few interesting exceptions. We suggest a plausible explanation of these results and point out their implications for future research. Suggestions for e-commerce practices are discussed.
TL;DR: This study proposes an architecture for an inter-organizational platform that facilitates the provisioning of collaboration services and concludes that the platform approach is beneficial in achieving increased flexibility in business-to-business collaboration.
Abstract: Organizations operating in a network require strong information technology support to successfully collaborate. In a business service network, the links between partners must enable quick connect and disconnect relationships, in order to harness market opportunities. Scholars claim that information technology platforms are necessary to enhance this quick connect capability and to transform business networks into digital ecosystems. However, the state of the art in inter-organizational collaboration relies on static collaboration patterns between individual partners, and current systems are engineered without interoperability in mind. In this study, we follow a design science approach to promote the concept of platform-based collaboration. More precisely, we propose an architecture for an inter-organizational platform that facilitates the provisioning of collaboration services. Furthermore, we present a prototype in the context of e-commerce as a means of evaluating the proposed design. We conclude that the platform approach is beneficial in achieving increased flexibility in business-to-business collaboration.
TL;DR: A longitudinal case study on HSPC, a platform jointly provided by a consortium led by multiple U.S. health care providers, and a platform management framework to capture and reconstruct the influence and interdependencies of choices over time are done.
Abstract: Multi-sided platforms have become the hallmark of the digital economy. However, their impact varies profoundly across different markets. We have done a longitudinal case study on HSPC, a platform jointly provided by a consortium led by multiple U.S. health care providers. Our focus is on the development processes of the platform over a period of five years and the underlying management decisions and design choices. We have developed a platform management framework to capture and reconstruct the influence and interdependencies of choices over time. The case highlights distinct strategic choices aiming at scaling of the platform and competitive positioning at an early stage of platform evolution. Our findings show four main conflicts regarding the implementation and scaling of the platform and its services as well as the processual interplay and interdependencies between different management areas. The paper thereby contributes to a process view on platform management and offers an understanding of specifics of platform evolution in health care.
TL;DR: A multi-period, multi-party simulation study that evaluate crowdfund raisers’ project positioning decisions and investors' project funding decision in a massive market reveals that dynamics of a crowdfunding market are rather complex.
Abstract: In recent years, as a novel financing mechanism, crowdfunding has gained popularity worldwide. In China, Crowdfunding started in 2011 and has experienced extremely fast growth since then. Several studies have identified success factors for crowdfunding. While these studies help infer the dynamics of crowdfunding, such dynamics have not been sufficiently examined, particularly by large-scale empirical studies. In addition, the relationship between crowdfunding market characteristics and project funding success remains fuzzy. In this research, we first empirically assessed the effect of crowdfunding success factors using a large sample (N = 5128) collected from Taobao.com
, a leading crowdfunding platform in China. Built upon these factors, we conducted a multi-period, multi-party simulation study that evaluate crowdfund raisers’ project positioning decisions and investors’ project funding decision in a massive market. In the simulation study, we varied market characteristics such as the number of projects, number of investors per project, entrepreneurs’ moral risk, and ratio of community over financial benefits, to observe their effect on participants’ decisions and consequently, project funding success rate. Results reveal that dynamics of a crowdfunding market are rather complex. These insights contribute to a more in-depth theoretical understanding of crowdfunding, as well as provide useful guidance for crowdfund raisers, investors, and administrators.
TL;DR: The findings presented here could assist product or service marketers who use Plurk or similar microblogging platforms better focus their limited financial resources on potential online customers to achieve maximum sale revenue.
Abstract: This study adopted a sentiment word database to extract sentiment-related data from microblog posts. These data were then used to investigate the effect of different types of sentiment-related words on product recommendations. The results indicate that posts containing strong sentiments received more clicks than posts containing neutral sentiments. Posts containing more than one positive sentiment word generate more effective recommendations than posts containing only one positive sentiment word. This study also demonstrated that posts with a negative polarity classification received more clicks than those with a positive polarity classification. Additionally, the microblog posts containing implicit sentiment words received more clicks than those containing explicit sentiment words. The findings presented here could assist product or service marketers who use Plurk or similar microblogging platforms better focus their limited financial resources on potential online customers to achieve maximum sale revenue.
TL;DR: This study enhances the understanding of the utilities roles of digital platforms and interaction between platform ecosystems and vertical integration and finds that the more platforms a cinema chooses to link with, the higher efficiency the cinema will achieve.
Abstract: Online to offline (O2O) is defined as e-commerce that combines searching and booking products or services online, and consumption in brick-and-mortar stores. Both China and other countries have witnessed the rise of O2O e-commerce platforms in recent years. This paper explores this rapid development from the supply side of O2O e-commerce platforms. Drawing upon the utilities roles of digital platforms and resource dependence theory, we propose and validate hypotheses on the relationships between platform choice and suppliers’ efficiency, using cinemas as an example. The findings support the significant and positive impact of platform choice on cinemas’ efficiency. Furthermore, we find that the more platforms a cinema chooses to link with, the higher efficiency the cinema will achieve. Our empirical results partially support that vertical integration has a negative impact on the relationship between platform choice and suppliers’ efficiency. This study enhances the understanding of the utilities roles of digital platforms and interaction between platform ecosystems and vertical integration.
TL;DR: This paper analyzes the state of the art in research and practice in order to develop a reference model of the value network for the insurance industry and categorizes MSP with regard to their relation to traditional insurance companies, resulting in a classification scheme with four MSP standard types.
Abstract: Multi-sided platforms (MSP) strongly affect markets and play a crucial part within the digital and networked economy. Although empirical evidence indicates their occurrence in many industries, research has not investigated the game-changing impact of MSP on traditional markets to a sufficient extent. More specifically, we have little knowledge of how MSP affect value creation and customer interaction in entire markets, exploiting the potential of digital technologies to offer new value propositions. Our paper addresses this research gap and provides an initial systematic approach to analyze the impact of MSP on the insurance industry. For this purpose, we analyze the state of the art in research and practice in order to develop a reference model of the value network for the insurance industry. On this basis, we conduct a case-study analysis to discover and analyze roles which are occupied or even newly created by MSP. As a final step, we categorize MSP with regard to their relation to traditional insurance companies, resulting in a classification scheme with four MSP standard types: Competition, Coordination, Cooperation, Collaboration.
TL;DR: The results prove that the extended concept of information sensitivity leads to a better understanding of privacy-related concepts especially in an interdependent privacy setting.
Abstract: From a theoretical point of view, previous research has considered information sensitivity in terms of potential negative consequences for someone who has disclosed information to others and that information becomes public. However, making information public could also have negative consequences for other individuals as well. In this study, we extend the concept of information sensitivity to include negative consequences for other individuals and apply it in a quantitative research study. The results prove that the extended concept of information sensitivity leads to a better understanding of privacy-related concepts especially in an interdependent privacy setting. We contribute to theory by defining the extended concept of information sensitivity and by drawing conclusions on how to use it in future privacy research studies.
TL;DR: A novel framework to explore the relationships between different types of entrepreneurial bricolage and online store performance is presented and it is shown that inputBricolage has a positive effect on efficiency performance and market bricolages has apositive effect on sales performance.
Abstract: Third-party e-commerce platforms (such as eBay and Taobao) provide great opportunities for small or minor sized enterprises (SMEs) to overcome technological challenges to enter e-commerce markets. However, SMEs still encounter other market entry barriers such as resource constraints and institutional challenges. We apply entrepreneurial bricolage theory to the context of online businesses operating on third-party e-commerce platforms in order to shed light on how SMEs could possibly cope with these challenges. We present a novel framework to explore the relationships between different types of entrepreneurial bricolage and online store performance. The research hypotheses were evaluated by survey data collected from a sample of small online stores operating on the largest third-party e-commerce platform in China, Alibaba’s Taobao.com
(NYSE: BABA). Results show that input bricolage has a positive effect on efficiency performance and market bricolage has a positive effect on sales performance, and the relationships between input (and market) bricolage and store performances are significantly stronger with higher level of institutional bricolage. Contrary to our expectations, the effects of input bricolage on sales performance and market bricolage on efficiency performance are positive but not significant. The study contributes to the development of entrepreneurial bricolage theory literature by providing a fine-grained analysis of the varying effects of different types of entrepreneurial bricolage on organizational outcomes. The findings of the study also provide guidelines for SMEs to effectively make use of resources at hand through the practice of entrepreneurial bricolage.