Lipsticks and razorblades: how the auto id center used pre-commitments to build the internet of things

This study explores the real-time emergence of the RFID (radio frequency identification) industry by investigating how the Auto ID Center, a MIT-based network of business organizations, is creating an infrastructure for computers to communicate with objects via The Internet of Things. The analysis shows how the Auto ID network originated in a “garbage can” fashion and used effectuation to grow through a series of stakeholder commitments. Effectual strategies are primarily means-driven and non-predictive. These strategies are directed at shaping—or designing—future markets rather than trying to predict them. Two theoretical mechanisms are used to frame the evidence in this study. First, the study builds on the concept of docility, originally devised by Simon (1993), by emphasizing the importance of reciprocal persuasion in new market creation. In free markets persuasion goes both ways in every interaction and the give-and-take of social advice is often a major help to people in their decision-making. Second, the study uses the concept of pre-commitment, which is a self-imposed non-negotiable constraint on our future choices. The Auto ID Center pre-committed to developing technology based solely on what stakeholder partners were willing to commit to. These two mechanisms are used to trace the temporal architecture of the Auto ID network. After originating in a garbage can, the network converged on increasingly specific goals as well as set in motion a widening process of mobilizing resources. The Auto ID network is bringing the idea of the Internet of Things to market piece by piece by transforming it into valuable new social artifacts, such as technical standards, infrastructure and markets for products and services.