THE GROWTH OF INNOVATION COMMUNITIES: COMMUNITY ECOLOGY AND DYNAMIC STRUCTURES

Abstract

IT innovations are enabling transformational change in many aspects of the economy and society, and can dramatically transform the way people live and organizations operate. The success and development of IT innovations depends on sustained investment and yet IT innovations are subject to rapid changes, significant uncertainty, and high risk of failure. As some IT innovations, such as thin-clients and specialized business programming languages, disappear; others, such as Customer Relationship Management (CRM) systems, become widely used. A lesson learned is that the development of successful IT innovations not only relies on inventing new technologies, but also on providing moderate deployment and sustained support. More importantly, the premise of developing successful IT innovations requires us to understand how, when, and in what context IT innovation occurs. Innovation communities and the participants within them are an important part of unpacking this complexity, as participants in the innovation communities constantly contributing to providing supports for developing IT innovations. Therefore, promoting and fostering successful IT innovations is dependent on the ability to support the development of IT innovation communities. Against this backdrop, using theories from sociology, information systems, and organizational studies, this dissertation focuses on two underexplored aspects of IT innovation community: ecology of IT innovation community and the dynamics of community structure. This dissertation fills a gap in prior research by applying organizational ecology theory to a mature IT innovation (CRM) at a community level, to explain the ecological evolution of an IT innovation and dynamic structural context of its associated community. Empirical studies were conducted to test hypotheses regarding ecological and network impacts. The study extends organizational ecology theory by considering the consequences of classic ecological forces (legitimation and competition) on multiple populations of organizations at a community level. Analysis of a longitudinal sample of 286 news articles from 1998 to 2007 suggests that the dynamics of the CRM innovation community are in part shaped by the entry rates of organizations participating as technology providers and adopters, and organizational entry rates are affected by ecological forces. Specifically, organizations' decision to participate in the CRM innovation community depended on two ecological forces: (1) legitimation of CRM attracted organizations to enter the CRM innovation community; (2) competition for resources deterred such entries. Additionally, this study tested the impact of dynamic community structure on organizations’ entry in an innovation community. To test if the network structure of the community was associated with a higher rate of entry by organizations participating as CRM technology providers, a network metric for community structure, scale-freeness, was added in classic density-dependence model. The results suggest that, beyond legitimation and competition, structure of the community that can utilize resources efficiently was linked to higher rate of entry by organizations participating in the CRM innovation community as technology providers. Overall, this dissertation brings organizational ecology theories of IT innovation from the population/industry level to the higher, community level where multiple populations/industries engage and adds additional insights to the repertoire of theories of IT innovation communities. In particular, this dissertation adds an organizational ecology explanation to understanding the evolution of IT innovation communities, recognizes the distinct populations and demonstrates their contributions to shaping the dynamics of innovation communities, and opens up new ways of thinking about how the network structure of the community interacts with organizations’ decision to enter the community, and affects the overall development of the IT innovation communities.