Horizontal disruption forces in the vertically integrated electric power industry
Linnankoski, Tommi (2017)
2017
Kauppatieteiden tutkinto-ohjelma - Degree Programme in Business Studies
Johtamiskorkeakoulu - Faculty of Management
This publication is copyrighted. You may download, display and print it for Your own personal use. Commercial use is prohibited.
Hyväksymispäivämäärä
2017-06-05
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:uta-201706131973
https://urn.fi/URN:NBN:fi:uta-201706131973
Tiivistelmä
Vertically integrated and constructed industries have dominated businesses for the past century. In particular, these have been established in the utility industries: the telecommunications industry, the water industry and the electric power industry. The dominant model of these vertical industries saw the integration of separate value chain parts to drive economies of scale profit formation further. Advances in technology have now put these dominant vertical structures under pressure. These forces open industries for new kinds of business models and new forms of market creation.
This study focuses on the currently on-going technological transformation of the electric power industry by examining key effects of these technological drivers of change. The research objective of this study is to describe and analyse the key emerging forces of technology-driven horizontal pressures on the dominant vertical electric power industry. The electric power industry has traditionally operated under a vertical structure and has remained virtually unchanged until recently. This has been the case especially in developed markets including Europe and North America.
This study was conducted as a qualitative case research. A theoretical framework was built to examine the empirical section of this research report. The framework first presents the theory of value development and co-creation. These fields of literature are then tied into theories of platforms and ecosystems. The empirical part of this study presents the dominant vertical structure of the electric power industry. Horizontal forces of disruption that are affecting this dominant structure are then presented.
This research finds that horizontal forces are challenging the dominant vertical structure of the electric power industry. These forces include new technologies, platform development and co-creation. Horizontal forces are changing the dominant pipeline of the industry towards a focus on individual platforms. This is resulting in a development of a broad horizontal electric power ecosystem. This research raises the question of 'industry' as the traditional unit of analysis and how the platform model challenges this view.
This study focuses on the currently on-going technological transformation of the electric power industry by examining key effects of these technological drivers of change. The research objective of this study is to describe and analyse the key emerging forces of technology-driven horizontal pressures on the dominant vertical electric power industry. The electric power industry has traditionally operated under a vertical structure and has remained virtually unchanged until recently. This has been the case especially in developed markets including Europe and North America.
This study was conducted as a qualitative case research. A theoretical framework was built to examine the empirical section of this research report. The framework first presents the theory of value development and co-creation. These fields of literature are then tied into theories of platforms and ecosystems. The empirical part of this study presents the dominant vertical structure of the electric power industry. Horizontal forces of disruption that are affecting this dominant structure are then presented.
This research finds that horizontal forces are challenging the dominant vertical structure of the electric power industry. These forces include new technologies, platform development and co-creation. Horizontal forces are changing the dominant pipeline of the industry towards a focus on individual platforms. This is resulting in a development of a broad horizontal electric power ecosystem. This research raises the question of 'industry' as the traditional unit of analysis and how the platform model challenges this view.