Stuck in the Conflicted Middle: A Role-Theoretic Perspective on B2B E-Marketplaces1

Abstract

Over the years, research on the implications of information technology on network governance structures has explored the “move to the market” and the “move to the middle” hypotheses. The middle is a space in which the logic and modalities of markets and hierarchies are intermingled. There is increasing evidence that most network relations reflect mixed-mode or hybrid logic. Despite the apparent advantages that make the middle so populous or “swollen” (Hennart 1993, p. 472), Kambil et al. (1999) highlight that it is riddled with uncertainty and high transaction costs. They label it “the conflicted middle” and propose that online marketplaces, specifically all-in-one markets, are capable of resolving this conflict. Unfortunately, however, Kambil et al. provide limited insight into both the nature of the conflict that plagues the middle and the ability of all-in-one markets to resolve it. To address these questions, this paper applies a role-theoretic perspective to the study of an e-marketplace that served the energy industry and evolved into an all-in-one market. Relying on an interpretive case study, this paper addresses the following research questions: (1) What is the nature of the conflict that characterizes the conflicted middle? (2) How do e-marketplaces, specifically all-in-one markets, help resolve this conflict? Our research highlights that brokers, trading partners, and agents who operate in the middle (where the contradictory logic of markets and hierarchies are mixed) experience goal, behavior, and identity conflict. All-in-one markets can help resolve these conflicts by supporting role integration at the group level and role segmentation at the individual level.

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