Designing Digital Infrastructures

Digital infrastructures are the fundamental information technologies and organizational structures with connected services and facilities required for an organization or industry to operate. Some examples of digital infrastructures are the Internet, EDI networks, ERP and CRM systems. Common for digital infrastructures is that they are shared by different users and are open, they are usually not designed from scratch, evolve over time and are composed of other IT capabilities which are emergent, evolutionary and nonlinear. Further, they are also path-dependent and subjective to network effects and unrestrained user and design learning.

So, as digital infrastructures are rarely developed from scratch, but are evolving and growing from an existing installed base, how do you design them? Before answering this question, let’s explain what an install-base is and why is it relevant for digital infrastructures:

Installed-base

The installed base is the number of components and users in the digital infrastructure. An installed-base pull in complementary products, which creates more attraction and use of the digital infrastructure by users. This, in turn, grows the size of the installed base, often referred to as the self-reinforcing mechanism which is a key attribute of a successful information infrastructure. In order to explain this simpler, think of your smartphone. The popularity of for example iPhones and Android is not just due to the quality of the smart phone itself, it is because of the vast number of apps and services you are able to download and use from third-party vendors. The more people use a smartphone platform, the more vendors see the potential of creating more services and apps.  Consequently, the installed-base keeps growing in terms of both end users and vendors creating the apps. This is the self-reinforcing mechanism.

Designing Digital Infrastructures

Further, digital infrastructures cannot be designed by traditional top-down approaches due to them being inherently generative and are founded on the notion that they are never complete. This generativity allows users (individuals, groups or organizations) from a bottom-up approach, to co-create and share new uses, such as new services, applications and content. So, as infrastructures are seldom developed from scratch and are subject to brownfield design, how do you design for the dynamic complexities of evolving numbers of systems shaped by an installed base?

Two recognized researchers from the Information Systems field, Hanseth and Lyytinen (2010) have gathered insight from a range of studies into a design theory for digital infrastructures. Their research study separates between two challenges when designing digital infrastructures; the ‘‘bootstrap problem’’, and the “adaptability problem’’. The bootstrap problem is based on the foundation of designing a new digital infrastructure, emphasizing the benefits of building on already existing installed-base. The adaptability problem addresses the growth of a digital infrastructure where unpredicted demands, opportunities, and barriers may develop. Below the design principles are outlined:

Design Principles

Design initially for direct usefulness
In regard to the bootstrap problem, the first design principle is to design initially for direct usefulness. When a large user-base cannot be projected, it is imperative to persuade the initial users through targeting their needs and prioritize instant use value. Scalability, extension, and the entirety of the solution come in later stages.

Build upon existing installed base
The next design principle is to build upon existing installed base, including building on an existing infrastructure, platforms or applications that are already in use. This can reduce the initial cost of the solution and switch cost for users.

Expanding the installed base by persuasive tactics to gain momentum
The next design principle is expanding the installed base by persuasive tactics to gain momentum. This generates positive network effects from extending the user base. Also, before new functionality is added, the installed-base should be big enough to sustain the added cost of development and learning.

Build flexible and adaptable digital infrastructures
Regarding the ‘‘adaptability problem’’, the aim is to build flexible and adaptable digital infrastructures, making the IT capability as simple as possible. It is important that your infrastructure is flexible enough to allow for frequent changes.

Modularize the information infrastructure
The last design principle is to modularize the information infrastructure, parting the layers of infrastructures from each other, utilizing gateways to connect layers and to preserve loose couplings between the connected digital infrastructures.

Consequently, next time you are concerned about how to design your digital infrastructure, the design principles outlined above should be considered- read more of Hanseth and Lyytinens literature on this. Furthermore, although these design principles are very useful, it is important to remember that politics in any organization plays an important role. The politics of digital infrastructure development and how to recognize, or manage the challenges of involving multiple stakeholders should also be addressed. The need to deal with the challenges of organizing, mobilizing and coordinating multiple independent stakeholders is important. Consequently, installed-base cultivation is imperative, but the design needs to deliberately include implementation strategies with the aim of minimizing the challenges related to stakeholder mobilization.