Linking technological system architecture and purchasing categories

Abstract

Though the link between technological system architectures and buyer-supplier relationships has been actively studied, no comprehensive framework connecting system structures and component purchasing categories exists. We examine the technological dependency structures of such systems by adopting the buyer’s viewpoint as system assembler and integrator. We articulate how system dependencies relate to switching costs and needs for investments and technological expertise in buyer-supplier relationships. By examining the extents and directions of indirect and direct dependencies at the technological systems level, we are able to identify the purchasing category to which each component is most likely to belong. We demonstrate our theoretical framework using an empirical example of a technological system from the energy industry.