Essays on innovation ecosystems in the enterprise software industry

Innovation ecosystem strategy is often adopted by platform technology owners to seek complementary innovation from resources located outside the firm to exploit indirect network effect. In this dissertation I aim to address the issues that are related to the formation and business value of platform innovation ecosystems in the enterprise software industry. The first study explores the role of three factors – increased payoff from access to platform owner’s installed base, risk of misappropriation due to knowledge transfer, and the extent of competition – in shaping the decisions of third-party complementors to join a platform ecosystem. The second study evaluates the effect of participation in a platform ecosystem on small independent software vendors’ business performances, and how their appropriability strategies, such as ownership of intellectual property rights or downstream complementary capabilities, affect the returns from such partnerships. Built upon resource based view and theory of dynamic capabilities, the third study reveals that users’ co-innovation in enterprise information systems, measured by their participation in online professional community networks, constitute a source of intangible organizational asset that helps to enhance firm level IT productivity.