Structure and evolution mechanism of the enterprise innovation ecosystem in terms of modularity: A longitudinal case study on Haier Group from 2005 to 2019

ZHENG Shuai; WANG Hai-Jun

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Science Research Management ›› 2021, Vol. 42 ›› Issue (1) : 33-46.

Structure and evolution mechanism of the enterprise innovation ecosystem in terms of modularity: A longitudinal case study on Haier Group from 2005 to 2019

Zheng Shuai^1,2, Wang Haijun¹

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Abstract

Upon the transformation of manufacturing enterprises into the ecological innovation strategy, how can the hub firm make technological and commercial decisions to enhance long-term competitiveness with the evolution of innovation ecosystem? The existing literatures have focused on the study on what innovation ecosystems are and how they operate, and most of them have neglected the impact of the external environment. This research aimed to complement the literatures by investigating when and why ecosystems emerge, as well as how the contexts lead to the co-evolution of innovation ecosystems? Based on the research framework of "situation-structure-mechanism", this paper explored the structure, evolution mechanisms and path characteristics of enterprise innovation ecosystem through a longitudinal case of Haier Group from the modularity perspective. The findings are as follows:
First of all, contexts dominate the realization of technological innovation. According to the remarkable events in the development of strategic transformation of Haier′s modular ecosphere, Haier Group has experienced three stages of the netting period for developing new resources, the webbing period for expanding new businesses, and the integration period for disruptive innovation. And this paper revealed the interactive evolution process of the enterprise innovation ecosystem with three situational factors: technical standards, user needs and policy supports.
Secondly, through the systemic analysis, this paper summarized three important characteristics of the structure of the enterprise innovation ecosystem: modularity of innovation architecture, open interface and embeddability of network governance. Thus the evolution path of Haier Group innovation ecosystem is starting from the internal-R&D-oriented innovation system, and transferring to the industry-chain-integration-oriented innovation system, and ultimately to the customer-requirements-oriented innovation ecosystem, which are driven by modular innovation architectures, practically speaking from product and production modularity, organization modularity to ultra-modularity in turn.
Last but not least, the innovation realization mechanism of the enterprise innovation ecosystem is manifested in leverage, synergy and mutual benefit mechanism. By revealing the structural characteristics of the innovation ecosystem and the operation logic of the implementation mechanism: (a)this paper put forward Haier had adopted the modular innovation architecture to maximize the leverage effects of the innovation ecosystem, keeping the structure open without sacrificing the decision-making openness, and the evolutionary path of leverage mechanism is starting from reusing module resources, and transferring to platform resources, and ultimately to ultra-modular scene resources. (b) Haier has facilitated external coordination through the cognitive embeddability of network governance which has laid the foundation of complementors′ trusts, as well as managed internal coordination through the modular innovative architecture. Thus the role of the hub firm has grown from the decomposer, the platform leader to the innovation integrator through cooperative mechanism. (c) Haier has created a more open and fair benefit-sharing contexts through open and transparent decision-making, the management of intellectual property rights and so on. Thus the mutual benefit mechanism has changed from enterprise leading to open market determining.
The results are important for complementing and developing the theory of the innovation ecosystem, and provide enlightenment on the design alternatives for manufacturing enterprises transforming to the innovation ecosystem strategy.

Key words

enterprise innovation ecosystem / modularity / evolution mechanism / longitudinal case study

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Zheng Shuai, Wang Haijun. Structure and evolution mechanism of the enterprise innovation ecosystem in terms of modularity: A longitudinal case study on Haier Group from 2005 to 2019[J]. Science Research Management. 2021, 42(1): 33-46

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