Exploring the strategic impact
of online communities:
A dynamic capabilities perspective
Dr. David Wagner (@dw_p)
Presenta...
2
Outline
1. Motivation
2. Theoretical Foundation
3. Research Design
4. Results
5. Discussion
6. Contributions
3
1. Motivation
• Focus of work: Strategic use of online communities
• Online communities are highly important in practice...
4
2. Theoretical Foundations
Online Communities (OCs):
• OCs are large collectivities “of voluntary members whose primary
...
5
3. Research Design
Explorative, multiple case study Yin (2009)
• Prominent method among strategy scholars (Eisenhardt, 1...
6
3. Results: Case Descriptions
Customer
Community
Innovation
Community
News
Community
Industry E-commerce Automotive Publ...
7
4. Results: Interview Quotes
Capability
Sample quotes*
(Interviews were conducted in German; the below citations have be...
8
5. Discussion
• OCs are organizational resources that can be used to implement
value-creating strategies (Barney, 1991; ...
9
6. Contributions
Contributions to Theory:
• Providing empirical insights into the strategic use of digital
technologies ...
10
Contact Details
Dr. David Wagner
Post Doc/Assistant Professor
Digital Strategy & Innovation
+49 (0)7131 6456 36-85
davi...
11
Key References
Bharadwaj A, El Sawy OA, Pavlou PA, Venkatraman N. 2013. Digital Business Strategy: Toward
a Next Genera...
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Exploring the Strategic Impact of Online Communities: A Dynamic Capabilities Perspective

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Presentation prepared for the 21st Conference of the International Academy for Management and Business, held in Montreal, QC, on May 19, 2016.

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Exploring the Strategic Impact of Online Communities: A Dynamic Capabilities Perspective

  1. 1. Exploring the strategic impact of online communities: A dynamic capabilities perspective Dr. David Wagner (@dw_p) Presentation prepared for the 21st Conference of the International Academy for Management and Business Montreal, QC May 19, 2016
  2. 2. 2 Outline 1. Motivation 2. Theoretical Foundation 3. Research Design 4. Results 5. Discussion 6. Contributions
  3. 3. 3 1. Motivation • Focus of work: Strategic use of online communities • Online communities are highly important in practice settings (Chui et al., 2012; McAfee, 2009; Kane et al., 2009; Treem & Leonardi, 2012) • Some contributions to the organizational and information systems literature (Aral et al., 2013; Faraj et al., 2011; Kane et al., 2013; Kraut et al., 2011) • Strategic implications largely neglected to date (Bharadwaj et al., 2013; Haefliger et al., 2011; Gulati et al., 2012; von Krogh, 2012) • Call to integrate online communities into dynamic capabilities research (Majchrzak, 2009) • Research question: How may online communities be used by organizations to adapt to a changing business environment?
  4. 4. 4 2. Theoretical Foundations Online Communities (OCs): • OCs are large collectivities “of voluntary members whose primary goal is member and collective welfare, whose members share a common interest, experience, or conviction and positive regard for other members, and who interact with one another and contribute to the collectivity primarily over the Net” (Sproull and Arriaga, 2007: 898). Dynamic Capabilities (DCs): • DCs are defined as a firm’s ability to continuously adapt its resource base to a volatile business environment in order to achieve and maintain a competitive advantage (Teece et al., 1997). • DCs can be “disaggregated into the capacity (1) to sense and shape opportunities and threats, (2) to seize opportunities, and (3) to maintain competitiveness through enhancing, combining, protecting, and, when necessary, reconfiguring the business enterprise’s intangible and tangible assets” (Teece, 2007: 1319).
  5. 5. 5 3. Research Design Explorative, multiple case study Yin (2009) • Prominent method among strategy scholars (Eisenhardt, 1989; Gibbert et al., 2008; Langley & Abdallah, 2011) • Much potential to advance knowledge on DCs (Teece, 2012) • Particularly suitable to theorize OCs (Urquhart & Vaast, 2012) • Multiple cases provide us with a richer understanding and allow us to compare OCs along key constructs. Field access: German Association for Community Management • Sampling strategy: Theory-based/criterion (Miles and Huberman, 1994) • Main source of evidence: Interviews with Social Media/Community Managers • Additional sources: Community data, on-site oberservations, prior studies, industry reports, press clippings, corporate documents
  6. 6. 6 3. Results: Case Descriptions Customer Community Innovation Community News Community Industry E-commerce Automotive Publishing Purpose Generation of product reviews Increase of ideas Generation of local news Capability Sensing Seizing Reconfiguration
  7. 7. 7 4. Results: Interview Quotes Capability Sample quotes* (Interviews were conducted in German; the below citations have been translated) Sensing “We recently switched shipping services from [Company A] to [Company B]. We now also offer deliveries via [Company C]. It was my task to oversee how people would react to these changes, whether there are any complaints. If so, I would need to speak to the board of directors to let them know what isn’t working. […] This is the reason why I’m invited to such meetings. I realize very quickly when things go wrong.” (Case 1) Seizing “The idea about [Product A] was initially posted to the community. It was taken up by the right people, who were also able to develop the idea further. The project was pitched in the right types of committees, later it received the necessary funding. Ultimately, [Product A] was developed and prototyped in cooperation with the same people who initially suggested it.” (Case 2) Reconfiguration “When we introduced the community, our editors were thrown in at the deep end. They were used to producing offline editorial content for the freesheets about once or twice a week. However, none of them had an affinity for producing content online, nor did they want to do it.” (Case 3)
  8. 8. 8 5. Discussion • OCs are organizational resources that can be used to implement value-creating strategies (Barney, 1991; Wernerfelt, 1984); commmunity- building is a key process for value capture (Kane et al., 2009; Kraut & Resnick, 2011). • OCs are central to strategy because of their potential to facilitate organizational adaptation to a changing business environment. • We define a community capability as a firm’s ability to create value through the business use of OCs; a community capability is a type of dynamic capability that is tied to OC contexts. • Caution: OCs do not necessarily take a strategic role, there may be a strategic misfit (Neumann et al., 1992), rival explanation: institutional isomorphism (DiMaggio & Powell, 1983)
  9. 9. 9 6. Contributions Contributions to Theory: • Providing empirical insights into the strategic use of digital technologies by organizations (Bharadwaj et al., 2013; Pan et al, 2015). • Integrating OCs into the DC framework by showing how online communities are mobilized to sense opportunities and threats, to seize opportunities, and to reconfigure the enterprise’s intangible and tangible assets, thus helping their host organizations to cope with changing business environments (Teece, 2007; Majchrzak, 2009) • Developing the notion of a community capability (Corley & Gioia, 2011; Puranam, et al, 2014). Contributions to Practice: • The results are relevant for practicing social media and community managers, helping them to understand the strategic role their communities (may) play and illustrating ways to employ them accordingly.
  10. 10. 10 Contact Details Dr. David Wagner Post Doc/Assistant Professor Digital Strategy & Innovation +49 (0)7131 6456 36-85 david.wagner@ggs.de www.kpsquared.org
  11. 11. 11 Key References Bharadwaj A, El Sawy OA, Pavlou PA, Venkatraman N. 2013. Digital Business Strategy: Toward a Next Generation of Insights. MIS Quarterly 37(2): 471–482. Faraj S, Jarvenpaa SL, Majchrzak A. 2011. Knowledge Collaboration in Online Communities. Organization Science 22(5): 1224–1239. Gulati R, Puranam P, Tushman M. 2012. Meta-Organization Design: Rethinking Design in Interorganizational and Community Contexts. Strategic Management Journal 33(6): 571– 586. Kraut RE, Resnick P. 2011. Building Successful Online Communities: Evidence-Based Social Design. MIT Press: Cambridge, MA. Haefliger S, Monteiro E, Foray D, von Krogh G. 2011. Social Software and Strategy. Long Range Planning 44(5–6): 297–316. Majchrzak A. 2009. Comment: Where is the Theory in Wikis? MIS Quarterly 33(1): 18–20. Pan, G., Pan, S.-L., & Lim, C.-Y. (2015). Examining how firms leverage IT to achieve firm productivity: RBV and dynamic capabilities perspectives. Information & Management, 52(4), 401–412. Puranam P, Alexy O, Reitzig M. 2014. What’s ‘New’ About New Forms of Organizing? Academy of Management Review 39(2): 162–180. Sproull L, Arriaga M. 2007. Online Communities. In Handbook of Computer Networks, Bidgoli H (ed). John Wiley & Sons, Inc.: 898–914. Teece DJ. 2007. Explicating Dynamic Capabilities: The Nature and Microfoundations of (Sustainable) Enterprise Performance. Strategic Management Journal 28(13): 1319–1350. Yin RK. 2009. Case Study Research: Design and Methods. Sage: Thousand Oaks, CA.

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