Recombination in digital innovation: Challenges, opportunities, and the importance of a theoretical framework

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Abstract

In this article I argue that the quest to establish digital innovation as a research domain is hindered by three challenges. As digital innovation research we are too often: a) reifying the agency of digital innovation actors; b) developing explanations of digital innovation detached from the specifics of digital technology, and c) developing overly specific explanations of digital innovation. I begin by providing a brief overview of the recombination perspective and considering why this perspective holds great appeal in the digital age. I then engage with Henfridsson et al.'s (2018) value spaces framework as a platform for framing value creation and value capture in relation to recombination in digital innovation. Next, I push Henfridsson et al.'s arguments one step further to discuss them in relation to what I consider to be the key challenges for digital innovation research. Illustrating with some of my own recent projects, I suggest that in order to fully address these challenges we need to (1) develop explanations of digital innovation acknowledging the complexity of sociomaterial interaction in digital innovation; (2) develop explanations of digital innovation building on the specifics of digital technology, and (3) develop explanations of digital innovation based on an oscillation between the specific and the general. The article concludes by pointing to future challenges and developments for digital innovation research.

Introduction

The concept of digital innovation has received much interest in recent years, both in research and practice. However, despite the burgeoning interest in digital innovation in both academic and public discourses, digital innovation is not yet a fully developed research field, rather it is an emerging body of theory and practice that draws from a number of different social science disciplines. Currently there are widely shared ambitions to progressively achieve theoretical and conceptual coherence in digital innovation research (Nambisan, Lyytinen, Majchrzak, & Song, 2017) so as to better inform research and practice (Nylén & Holmström, 2015). As such, there is a need for deeper theorization of digital innovation initiatives and broader processes of transformative change.

With the digitization of innovation, traditional assumptions of value creation are being challenged (e.g., Henfridsson, Mathiassen, & Svahn, 2014; Yoo, Boland Jr., Lyytinen, & Majchrzak, 2012), raising the need for new theory development and inviting alternative conceptualizations of value creation. An important contribution towards this end is the paper by Henfridsson, Nandhakumar, Scarbrough, and Panourgias (2018) where an ambitious agenda for understanding recombination in digital innovation is articulated. In their paper, the authors have turned a scholarly eye to the notion of recombination in digital innovation to unpack the conditions and mechanisms that make it work. Below I examine their value spaces framework followed by a discussion of some key challenges and opportunities for recombination in digital innovation, paving the path for new theory development. Based on this examination I conclude with an assessment of further avenues to pursue in digital innovation research.

Section snippets

Recombination in digital innovation: challenges and opportunities

Digital innovation refers the use of digital technology during the process of innovating or the outcome of innovation (Nambisan et al., 2017). The opportunity to innovate by digitizing products and offering digital services has proven to be challenging to firms in traditional industries (e.g. Henfridsson et al., 2014; Svahn, Mathiassen, & Lindgren, 2017). In contrast to a traditional value chain structure, typically present in traditional industries, value in digital innovation is created

Moving beyond the value spaces framework

Significantly, the value spaces framework is both scholarly and practical, making it a valued resource for not only for researchers but also for executives and others working to solve complex digital innovation challenges in practice. In generating essential theory for understanding the context, process, and outcomes of digital innovation Henfridsson et al. (2018) have leveraged the boundary between theory and practice to the benefit of both.

Juxtaposing the value spaces framework with the

Conclusions

Henfridsson et al. (2018) should be commended for their very ambitious approach to recombination in digital innovation by offering the value spaces framework as a tool for better understanding value creation and capture in digital innovation. I have tried, in this paper, to extend their analysis to address what I consider to be the key challenges for digital innovation research. I personally think that we have overemphasized the idea of induction in empirical digital innovation research,

Jonny Holmström is a professor of Informatics at Umeå University and director and co-founder of Swedish Center for Digital Innovation. He writes, consults and speaks on topics such as IT management, digital innovation, digital strategy, digital entrepreneurship, and strategies for leveraging value from digitalization. His work has appeared in journals such as Communications of the AIS, Convergence, Design Issues, European Journal of Information Systems, Information and Organization, Information

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    Jonny Holmström is a professor of Informatics at Umeå University and director and co-founder of Swedish Center for Digital Innovation. He writes, consults and speaks on topics such as IT management, digital innovation, digital strategy, digital entrepreneurship, and strategies for leveraging value from digitalization. His work has appeared in journals such as Communications of the AIS, Convergence, Design Issues, European Journal of Information Systems, Information and Organization, Information Systems Journal, Information Technology and People, Journal of the AIS, Journal of Information Technology, Journal of Strategic Information Systems, Research Policy, and The Information Society. He currently serves as senior editor for Information and Organization.

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