Chapter 6: Affiliated or Aligned?: Orchestration Modes of Multipartner Innovation Among Incumbent Firms and New Ventures

As technologies become increasingly specialized and customers require more modular, flexible, and interconnected solutions, single firms face increasing difficulties in serving these demands on their own. Hence, joint innovation of multiple firms gains in importance. While earlier research stressed the comembership in networks and associations as catalyst for creating innovations together with diverse partners, more recent research focuses on ecosystems thriving on complementarity and modularity—independent of membership contracts—as drivers of multipartner innovation. However, the increasing divergence between these two perspectives, that is, ecosystem-as-affiliation and ecosystem-as-structure, impedes a structured decision-making process among the different options for multipartner innovation. We therefore delineate an integrative framework of four member-based modes of orchestrating multipartner innovation (i.e., following the ecosystem-as-affiliation paradigm) and of four value-proposition-based modes of orchestrating multipartner innovation (i.e., following the ecosystem-as-structure paradigm), depending on the type of orchestrator: (1) no orchestrator (i.e., based on standards), (2) incumbent firms as orchestrators, (3) third-party organizations as orchestrators, and (4) new ventures as orchestrators. By distinguishing these orchestration modes from the perspectives of incumbent firms and new ventures, we provide clarity on the objectives of each type of firm to derive key challenges (e.g., determining memberships, selecting complementors) and opportunities (e.g., pooling common interests to commercialize novel technologies, creating novel value propositions). We conclude with two mode choice frameworks—one for incumbent firms and one for new ventures—that explain key decision criteria for each orchestration mode.