Abstract
Knowledge management is a key capability for innovation. Prior research has typically conceptualized and examined knowledge management capabilities as a property of an individual firm or business unit. More recently, however, the locus of competition and innovation has started to shift from the individual firm to firms working together as an ecosystem. In light of these changing realities, we explicate a set of capabilities that are built, maintained, and exercised by the lead firm in order to enhance innovation within ecosystems. We highlight three knowledge management capabilities: (1) knowledge acquisition, (2) knowledge sharing, and (3) knowledge utilization. Drawing on open and closed action strategies firms use to foster team-based innovation, we develop propositions for the knowledge management capabilities of the lead firm. Our approach highlights three salient tensions that arise from team based innovation: autonomy–control, dissent–consent and uncertainty–certainty. We highlight how the three tensions need to be managed across knowledge management capabilities in order to increase the rate of innovation of the ecosystem. In doing so, we contribute to the evolving marketing literature on sensing and responding in ecosystems in order to provide customers with superior value. We discuss the implications for both managers and theory.
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Notes
Leverage refers to the means by which firms generate an impact that is disproportionately larger than the input required in order to create value and, hence, competitive advantage. Leverage could imply production leverage to achieve economies of scale and scope, transaction leverage to achieve transaction efficiency through pricing and market access, or innovation leverage to achieve the economics of innovation to facilitate the creation of new goods/services or business models (Thomas et al. 2014). The focus of this paper is on innovation leverage.
The term platform has been used in a variety of contexts. For example, the organizational context views a platform as organizational capabilities that enable superior performance; the product family context views a platform as a stable centre of family of products to enable derivative products; the market intermediary context views a platform as an intermediary between parties to a market based exchange; and, finally, the platform ecosystems context views a platform as a system that supports a collection of complementary assets (Thomas, Autio and Gann 2014, p. 200). Our use for the purposes of this paper is similar to the platform ecosystems context.
Some studies extend the notion of a platform to include network effects where there are demand side network externalities (Gawer and Cusumano 2014). Demand side network externalities imply that as more users adopt the platform, the platform becomes more valuable to other users. Demand side network externalities are not key to our use of the term in this paper.
The literature has used various terms such as lead firm, hub firm, network orchestrator, and keystone firm, among others. We use “lead firm” to denote leadership in the ecosystem.
This case vignette is based on author’s own interviews with ARM Holdings PLC.
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The author would like to thank Jan Heide and Sriya Iyer for helpful discussions. The author would also like to thank the Editor and the anonymous reviewers for their helpful comments on earlier versions of this paper.
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Velu, C. Knowledge management capabilities of lead firms in innovation ecosystems. AMS Rev 5, 123–141 (2015). https://doi.org/10.1007/s13162-015-0068-6
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DOI: https://doi.org/10.1007/s13162-015-0068-6