Impact of minimum viable product on software ecosystem failure

Context

Companies are interested in building successful value-producing ecosystems together to offer end users a broader digital service offering and better meet customer needs. However, most ecosystems fail in the early years.

Objective

We investigated one small software ecosystem from the planning phase to the operative phase, where the participating companies left one by one because the software ecosystem was unsuccessful, and the software ecosystem ended after four operative years. The software ecosystem provided a digital service offering based on the defined MVP (Minimum Viable Product). That is why we were interested in understanding the MVP's impact on the ecosystem's failure.

Method

We conducted a case study, the results of which are based on the semi-structured interviews of eight representatives of the software ecosystem.

Results

This study showed that the actors prioritized out functionalities from the MVP, and the MVP was no longer based on the defined value proposition, target customer groups, and customer paths. It was then difficult for the actors to achieve their objectives. The companies’ commitment depended on the set objectives, and when the objectives were not achieved, the actors left the ecosystem, and the software ecosystem failed.

Conclusion

The results show that the MVP can significantly affect the failure of the small software ecosystem, where all actors have a keystone role. The MVP largely defines what kind of digital service offering the software ecosystem provides and whether the actors can achieve the objectives, especially their sales goals. Thus, prioritizing the functionalities of the MVP is a critical activity.