Innovation Management on Online Platforms

In this thesis, I study operational decisions on online platforms (e.g., InnoCentive, Topcoder, Kickstarter, and Indiegogo) that facilitate crowd-based innovation and new product development, and I provide insights into how the economic value generated on these platforms can be enhanced. In the first two chapters, I focus on crowdsourcing platforms (e.g., InnoCentive and Topcoder) that create value by regularly organizing innovation contests to find solutions to their clients’ innovation-related problems from the crowd. Although the value generated on crowdsourcing platforms is highly dependent on contest organizers’ decisions on the contest rules such as award scheme, duration, and whether to allow team collaboration, these decisions and related trade-offs have received limited attention in the literature. To address this, in the first chapter, I analyze how an organizer should decide on the duration and award scheme for a contest; and in the second chapter, I study in what circumstances an organizer should encourage solvers to collaborate as teams or discourage team collaboration. In the third chapter, I focus on crowdfunding platforms (e.g., Kickstarter and Indiegogo), where entrepreneurs launch campaigns to crowdsource funding to bring their innovative ideas to life. Although crowdfunding is well recognized as an alternative means of funding, recent research and practice suggest that entrepreneurs often use crowdfunding as a mechanism for involving customers in product development. This motivates me to provide an understanding of crowdfunding as a product development mechanism and to study a key operational decision faced by an entrepreneur: whether to launch a crowdfunding campaign for a basic or enhanced version of a product