Platform-based service innovation and system design: a literature review

Publication Date11 Jun 2018
AuthorWenhui Fu,Qiang Wang,Xiande Zhao
SubjectInformation & knowledge management,Information systems,Data management systems,Knowledge management,Knowledge sharing,Management science & operations,Supply chain management,Supply chain information systems,Logistics,Quality management/systems
Platform-based service
innovation and system design:
a literature review
Wenhui Fu
China Europe International Business School,
Shanghai, China
Qiang Wang
School of Management, Xian Jiaotong University, Xian, China, and
Xiande Zhao
China Europe International Business School,
Shanghai, China
Purpose The purpose of this paper is to systematically review the platform literature and synthesize the
various topics of research into a common framework to reveal the relations between platform-based service
innovation, system design and other platform-related factors.
Design/methodology/approach A quantitativedescriptive analysisled to an overview of the distribution
of research focuses of the 187 samplearticles identified by a well-established searchstrategy. A qualitative in-
depth reviewwas then used to clarify the detailed research topics and generatean overall conceptual model to
link them, with a focuson platform-based service innovation and systemdesign.
Findings In total, 11 research topics of three research perspectives were identified and linked by a
framework that accounts for the relationships between platform-based service innovation and system design
and their influences on platform evolution. A small panel of industry experts validated the accuracy and
utility of the proposed framework.
Originality/value This paper provides an integrated framework for separately developed research
perspectives and the topics investigated in the platform literature. Through the proposed framework, this
paper helps to improve the knowledge on platform study and management, and lays a foundation for
exploring the research opportunities in platform-based service innovation and system design.
Keywords Service innovation, Literature review, System design, Network platform
Paper type Research paper
1. Introduction
Platform-based businesses have gained great popularity in recent years. An increasing
number of firms are adopting this model to meet the needs of heterogeneous users and to
exploit network effects and external resources that complement those of the firm
(Ceccagnoli et al., 2012). Consequently, platform studies have similarly burgeoned (Thomas
et al., 2014). Rooted in different intellectual traditions and based on distinct assumptions,
platform studies have been dominated by different theoretical perspectives, including the
engineering design perspective, an economics perspective and ecological perspectives;
research has been conducted at the level of individual products, product systems, industry
supply chains, markets, industries and even constellations of industries, covering a wide
variety of topics (Gawer, 2014; Thomas et al., 2014). However, as the platform concept
evolves and the application context expands, a limited and divided research agenda cannot
properly explore the increasingly complicated platform phenomenon (Gawer, 2014).
Industrial Management & Data
Vol. 118 No. 5, 2018
pp. 946-974
© Emerald PublishingLimited
DOI 10.1108/IMDS-03-2017-0129
Received 31 March 2017
Revised 31 October 2017
10 January 2018
Accepted 18 January 2018
The current issue and full text archive of this journal is available on Emerald Insight at:
This research was supported by National Natural Science Foundation of China (71602159,
71420107024, and 71572141).
This paper forms part of a special section Featured issue on supply chain innovation.
For example, traditional manufacturing firms may know how to design an efficient
product platform system, but they are likely to lack knowledge on how to attract various
external resources and stimulate network effects to expand their business (Fu et al., 2017).
On the other hand, many internet-based firms are good at developing innovative services to
attract external resources, but they sometimes face the system design problem such
as the mismatching between internal technological and external business systems
(Tiwana et al., 2010).
This situation calls for a comprehensive review of the different research streams and
some attempts have been made to do so (Tranfield et al., 2003; Thomas et al., 2014; Facin
et al., 2016). For instance, Tiwana et al. (2010) explored the co-evolution of platform
architecture, governance and environmental dynamics. Gawer (2014) bridged internal
platforms, supply chain platforms and industry platforms by combining their innovations
and competitions. Thomas et al. (2014) provided a model that allows different platform types
to be placed in context with others. Facin et al. (2016) clarified the evolutionary trajectory of
the platform concept. These literature reviews have helped to provide a coherent theoretical
grounding for platform studies. However, little attention has been paid to platform-based
service innovation and system design, when integrating different research streams.
A distinguishing feature of the platform business is that it is neither like a firm (which has
definite boundaries) nor like a marketplace (with more permeable borders); it is, rather,
a foundation created by a firm that lets other firms build products and services upon it as in
a marketplace(Kelly, 2016, p. 122). A platform owner, therefore, has to consider both the
system design actions that solve an essential foundationproblem and the innovative
service actions that stimulate complementorsincentives to co-create value as in a
marketplace(Gawer and Cusumano, 2002, 2008, 2014). This highlights the critical roles of
platform-based service innovation and system design in understanding the platform
phenomenon and developing platform-related theories (Gawer, 2014; Zhao et al., 2015).
Furthermore, understanding how these two critical factors interact with other
platform-related factors and jointly advance the success of a platform is also vital.
The objective of this review, therefore, is to provide an up-to-date and comprehensive
understanding on the research streams and topics related to platform-based service
innovation and system design, and on how they relate with other research issues in platform
studies. By systematically reviewing 187 papers on platform business between 2006 and
2016, this review synthesizes different research perspectives and research topics into a
comprehensive framework, which lays a foundation for an exploration of the research
opportunities in this area.
This review makes several contributions to platform studies and practices. First, by
using a hybrid research approach (a quantitative descriptive analysis and a qualitative
in-depth review), we clarify various research topics in different research perspectives.
Second, we delineate relationships between these separated research topics and provide a
comprehensive framework to reveal the mechanism of platform evolution driven by
platform-based service innovation and system design. This framework will help to enrich
the knowledge of platform development. For example, it will illustrate how firms with
different resource endowments (e.g. manufacturing-oriented or service-oriented firms) gain
heterogeneous capabilities (e.g. servitization or efficiency enhancement) in their process of
platformization, and how platform-based ambidextrous capabilities can be enhanced via
internal optimization vs external interaction, or a vertically integrated structure vs a
pluggable open structure.
The review proceeds as follows. In Section 2, we set out our search strategy and provide
an overview of the distribution of research focuses of the literature. The literature is then
reviewed by an in-depth analysis in Section 3. The analysis identifies 11 research topics,
explored from three perspectives: product family, multi-sided market and business

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