Ecosystems

Background

Ecosystems and why they matter

My definition of ecosystems

Dynamic, self-organizing networks of independent, autonomous actors that in interaction, are interdependent of each other for growth and survival.

Ecosystems are popular. Companies use them to create new revenue and drive innovation. Collaborating on something bigger also helps you grow.

But how does collaboration in complex ecosystems work? What are platform ecosystems? What works and what doesn’t when building an ecosystem? And where do you start?

Corporate leaders

According to EY research 68% of corporate business leaders say that ecosystems and partnerships are the only way to succeed in the market.

IBM research shows almost 70% of CEO’s partnered extensively in 2012.

Market value

Companies reported one-third of their market value depended on these partnerships. [1]

[1] De Man, A. 2013. Alliances, An Executive Guide to Designing Successful Strategic Partnerships, Chichester. 4

Ecosystems are all around us

We are all part of multiple ecosystems, whether we are aware of it or not.

Ecosystems

01/ Are demarcated

Ecosystems connect organizations across different sectors.

Participants depend on each other in multiple ways;
There is no hierarchical control;
You are either part of it or not.

02/ Are self-organizing

Ecosystems form, grow, and shrink on their own. As a participant, your influence is limited. This calls for a step-by-step, cyclical strategy. Three questions guide this process:

WHAT do you see happening right now?
SO WHAT does this mean for what you want to achieve?
NOW WHAT can you start doing as a first step for change?

And a new cycle starts.

This is the opposite of the oh so common “plan, design, determine and control.

03/ Dampen disturbances

Ecosystems ALWAYS respond to disruptions, both internal and external. They constantly move from balance to imbalance and to new balance.

An effective influence strategy is therefore to challenge the status quo.

Ecosystems are...?

When I asked the Linkedin Community that question, their voting resulted in:

Constructed and Developed 75% 75%
Found and Activated 25% 25%

So depending on your role in an organization and what you want to achieve, you look at your ecosystems differently.

There are roughly two reasons for ecosystem collaboration;

wanting to innovate for new potential. Here you usually try to construct an ecosystem. This assumes very much feasibility, design, predictability and control.
wanting to solve complex problems. Here you usually try to activate existing ecosystem players. It assumes equal collaboration, co-creation, giving meaning together, common values and greater purpose.

It’s two sides of the same change coin. But with different principles and process.

Do you have a case you would like to discuss?

contact

What about Your Ecosystem?

Is an ecosystem collaboration the right choice for your challenge?

Ecosystems are loosely coordinated (if at all)

Who would want to fly in a plane built by a loosely coordinated ecosystem of organizations? In this case, the complexity, focus on safety, and integrated nature of the design call for a much more tightly integrated collaboration model and a hierarchical supply chain.

In ecosystems, you can ask partners to co-create with you, but you don’t solely set the rules. A few questions to stimulate partner engagement:

How do we build our collaboration?
How do we share value?
How do the activities of different organizations come together?
Which organization’s procedures will change to align with the other’s? (a challenging question)

The need for the right orchestrator

In every ecosystem collaboration, there is at least one organization that takes on the role of the orchestrator. But this doesn’t necessarily mean it is the best fit for the job.

The orchestrator must be a key member of the ecosystem, controlling essential resources such as a strong brand, access to customers, or key skills.
The orchestrator should hold a central position in the ecosystem network, with strong dependencies on many other players and a resulting need and ability to effectively coordinate.
The orchestrator must be seen by others as a fair (or even neutral) partner, not as a competitive threat.
The best candidate is likely the player with the greatest net benefits from the ecosystem, and thus the ability to take on the largest initial investments.

Nothing happens until the puzzle is complete

Being the first doesn’t matter if the key partners in your ecosystem aren’t ready. Your success depends on the collective result, and that only happens when the last piece of the puzzle falls into place.

That’s why helping the weak link is always the best idea. It has a much greater impact on overall success than just strengthening your own part.

Start with your strategy

Organisations that actively involve their ecosystem in their strategy development are more flexible and resillient compared to organisations that don’t.

Here are four ways how ecosystems are used in Strategy Development. Your level of influence on your ecosystems starts with a strategic choice.

When ‘More of the Same’ no longer works in collaboration

Giving and Receiving

In ecosystem collaborations, you always get something back; maybe later or from someone else, but always from someone in the network. This applies even to competing organizations, especially in times of crisis.

How do you give and receive in your ecosystem?

Activating goodwill

Research shows that the ability to activate ‘goodwill’ within an ecosystem depends on two factors: the level of trust between people and how accessible the right people are.

How accessible and available are you in the ecosystem?

New Combinations

Research shows that innovation and change come from creating new combinations. The ‘new’ emerges by collaborating with people outside your usual network.

How open are you to collaborating with new organizations?