Incumbent-Born B2B Platforms: Organizational Boundary Dynamics in Platform Creation

Abstract

This study examines the dynamics of organizational boundaries in B2B industry platform creation through an in-depth single-case study. Specifically, we address the question: How do B2B firms redefine their organizational boundaries when shifting from a pipeline model to an industry platform? This research question addresses two critical gaps in the platform literature. First, platform creation is a relatively underexplored topic, with limited attention given to organizational boundary choices in the pre-launch phase. Second, most insights stem from B2C settings, leaving the B2B context relatively overlooked. We examine the dynamics of organizational boundaries, drawing on the lenses of identity, power, competence, and efficiency, in a Finnish firm that began as a consulting firm, shifted to selling stand-alone software, and is now creating an industry platform, ultimately comprising three phases with two transitions in between. This article contributes to strategy discussions on industry platforms, specifically to boundary choices in B2B platform creation, by developing propositions that outline the dynamics of organizational boundaries in creating an industry platform through the intermediary step of offering a stand-alone product. Our study provides three key managerial takeaways for incumbents seeking to create industry platforms: phased challenge management, milestone-driven flexibility, and proactive harnessing of network externalities.