Harvard Business Review publishes an excellent article on ecosystems by Prof. Gianvitto Lanzolla (Bayes Business School) and Prof. Constantinos Markides (London Business School). This is a fantastic topic!
You may not realised it but roughly 50% of the top brands in the world are already managing ecosystems. You may think of Amazon, Salesforce, Google or Apple for instance. But it we look closely to it, the insurance industry has been working with ecosystems of partners for decades too.
Pivoting to an ecosystem strategy brings some good business perspective for an organisation. Opportunities are manifold:
– The leveraging of resources and capabilities that it does not have.
– The leveraging of others’ creativity, agility, and innovation mindset.
– Economies of scale.
– The potential to co-create new services and have new sources of revenue, etc.
As the authors mention it, switching to an ecosystem approach has challenges too. It may not be straightforward either and working with partners somewhat totally new to some organisations.
In many cases it requires moving from a siloed and linear operating model to a platform and ecosystem thinking. Many functional areas are impacted. This is a cultural change, throughout the whole organisation.
– How to identify and select the most appropriate partners? The ones that are complementary to my business, with similar business objectives, a good fit in terms of culture and strategy, and, of course, with good reputation and financial status.
– How do I onboard them efficiently?
– How do I exploit my ecosystem to drive new sources of revenues? I mean the co-creation and pricing of new bundles or services in some cases or the efficient distribution of my products in the case a “distribution-focused” ecosystem.
– How do I control the quality of services and trustworthiness of partners over time?
– How do I continuously align with my strategy?
There are a good number of questions to be addressed. Organisations may require the support of consultants to support them in the journey.