Grassroots Resistance to Digital Platforms and Relational Business Model Design to Overcome It: A Conceptual Framework

Abstract

Although extant research has studied incumbent resistance to digital platforms, it provides little understanding about when grassroots collective action by other ecosystem stakeholders against the digital platform is likely. In this paper, we identify the scope conditions detailing when local stakeholders can initiate grassroots collective action against the digital platform, a unique context characterized by fast growth, distributed innovation, role flexibility, and direct local connectivity, and propose viable solutions. Our conceptual framework suggests that grassroots collective action against the digital platform is most likely when the digital platform operates with localized scarce assets or localized precarious labor and when actors express their grievances through formalized channels. We combine business model design and stakeholder management perspectives to develop design-based solutions that involve a multisided business model structure, an inclusive stakeholder value proposition, and an ecosystem-centered governance. We call the combination of such design efforts relational business model design. To the incipient theory of digital platforms, we contribute a stakeholder-centered view of platform business models operating within local ecosystems, bridging research on collective action and stakeholder management with strategic management of platforms.