Governance of innovation network in services: The case of Alibaba

Abstract

The governance issues of the innovation networks in services are less studied. The case study of Alibaba presents an example of how an innovation network in services is governed and how the governance provides the key resources for business model innovation. Alibaba establishes its innovation network by setting collaborative relationships with or acquisition of leading companies from different sectors of e-commerce industry. Three different governance mechanisms are defined for this case as equity-based governance, contract-based governance and trust-based governance. The well governed relationships between Alibaba and its partners in the innovation network are playing an important role in the business model innovation of Alibaba.