Control Point Dynamics in Emerging Digital Business Ecosystems: The Case of the Digital Agriculture

With the emergence of digital technologies, companies move from vertically integrated value chains towards digital business ecosystems. In such ecosystems, companies leave their original bargaining position, where they are aware of who creates how much value and how much control they have in negotiating value capture. In digital business ecosystems, however, the control over value creation is dispersed among multiple actors, across different industries and encompassing different layers (e.g. physical devices, networks, services and content). As a consequence, tension between value creation and value capture increases, as value creation occurs by means of cooperation and value capture is determined by a bargaining relationship. Prevailing theories and concepts such as Porter’s five forces or the resource-based view provide an insufficient explanation of how companies manage to achieve a competitive advantage in a digital business ecosystem. This paper sheds light on the less explored concept of control points reflecting the dynamic bargaining situation in emerging digital business ecosystem. Therefore, we conduct a multiple-case study with 15 companies, industry associations and consultancies in the digital agricultural ecosystem. We identify nine different control point categories emerging on the way from the traditional linear value chain towards digital business ecosystems. Subsequently, we derive six exemplary strategies based upon various control point constellations and thus actor’s superior power in e.g. having digital or physical customer access or being able to provide the necessary infrastructure to connect various actors in the ecosystem.