Governance is essential, however somewhat generic. We delve now into the idea of ‘information platform governance’. Is there anything specific to the governance of platforms? We distinguish three important features: the decision-making structure, control mechanisms and ownership structure.
Key words: governance, information platforms, ownership, control
Platform governance refers to the solutions that organizations devise for problems of coordination (Markus & Bui, 2012). There are two generic types of governance that are relevant to understanding platforms. On the one hand, governance refers to processes, social practices and activities, performed by institutions or actors (Bevir, 2013). This form of governance is not always tangible, may be informal and in essence concerns coordination and control of a social system. When we speak of governance in this handbook, we often mean this form of governance concerning – amongst other things – the power, interests and salience of actors involved in mobility data platforms. On the other hand, governance can also refer to a more tangible, formal part of the structure, control and processes for decision making and coordination of platforms (von Tunzelmann, 2003). This second form concerns instruments and mechanisms that are employed to exercise control over platforms, both in development and operations. Tools of governance can be rather generic such as laws, but also include administrative rules, practices, decision making processes and institutional arrangements used to align the various characteristics of demand (e.g. information users) and supply (e.g. information providers and IT-service providers) (Cusumano, 2005; Lynn, Heinrich, & Hill, 2000). In this column, we explore such more tangible and formal instruments of governance that are relevant in the governance of mobility data platforms.
Governance serves to come to agreements on (technical) standards and procedures that guide the activities of the large numbers of organizations involved in a platform. Governance is important because it is believed to contribute to the efficiency and effectiveness of inter-organizational arrangements (Provan & Kenis, 2008). Specifically related to platform governance, Tiwana et al. (2010) identify three main elements: the partitioning of decision rights, formal and informal mechanisms of control, and the ownership structure. We follow this structure and discuss each of them in turn, paying attention not only to the structural aspects of governance, but also to the process aspects.
The decision-making structure is about who decides, how, and on which components of the platform in terms of functionality, design and implementation. It also dictates who has control over the interfaces and thereby over the evolution of the platform (Baldwin and Woodard, 2009; Tiwana et al., 2010). There often is some degree of decentralization of authority and responsibility for different types of decisions. An important question is how and when decision rights should be shared, often a question of balancing autonomy of parties and coordination of the platform (Klievink, 2011; Tiwana, Konsynski, & Bush, 2010).
Tiwana et al. (2010) identify different formal and informal mechanisms of control over the platform (i.e. to encourage desirable behaviour by actors involved), including input control (where an owner decides what goes on the platform), process control (methods and procedures prescribed to parties), and informal control (e.g. values, norms, trust) (Tiwana et al., 2010). In business-to-government reporting, there typically is a formal relationship and an obligation to report to government. However, beyond that, parties are autonomous and thus the development of the platform needs to be in the interests of – indeed even driven by – the businesses, whilst at the same time offering the opportunity to government agencies to capitalize on these developments to transform the way they interact with businesses. This means that government agencies are stakeholders having their own interests and instruments (e.g. they can make it rewarding for businesses to configure and use the platform in a way that it facilitates business-to-government exchange), but without formal authority or hierarchical mechanisms to steer the platform entirely. Trying to impose constraints or incentives may remove the “luxury” of considering not to participate, but this may threaten the collaborative nature of the partnership underlying the platform (Johnston & Gudergan, 2007). Apart from the formal governance instrument (i.e. the agreed-upon decision making structure), overall a collaborative form of governance is needed, as traditional modes of governance (e.g. hierarchical, authoritative, contract-based) may be counterproductive in making the platform successful (Gawer, 2014). Balancing some kind of steering of (or control over) the overall platform with the autonomy of the actors that participate in it is especially challenging for platforms joining-up public and private parties; the innovations have to make business-sense, and advance the agenda of government agencies.
Next to the decision-making structure and control mechanisms, a third category in platform governance is the ownership structure (Tiwana et al., 2010). A platform can be proprietary to a single firm (i.e. the platform leader, especially if the platform is the core business strategy of the actor), or ownership is shared between multiple actors. In case the government puts heavy requirements on the platform without ensuring that the platform offers sufficiently for businesses, control over parts (e.g. the interfaces or at least the standards) are likely to end up with government. An important element especially in proprietary solutions or shared ownership is the (perceived) neutrality of the platform, especially when it comes to data that are commercially sensitive. If the platform is meant to (partially) fulfil a public role, governments may step in by on the one hand subsidizing parts of the basic infrastructure and on the other hand pushing for open standards to ensure flexibility. Open standards reduce the dependency on a specific platform and thereby weaken the position of the platform provider. In any case, the use of technological standards is needed to facilitate adoption, as a lack of standards lead to high investments by actors without the ability to re-use them in other connections (Markus, Steinfield, Wigand, & Minton, 2006).