Comparing Operating Models to change to Business Ecosystems
Forget how you operate in traditional business models if you are considering the value and benefits of applying Ecosystem thinking and designs. You really have to think radically differently.
There are significant differences in how we (can) operate and appreciate the distinctive aspects between our traditional management approach and applying Ecosystem thinking and design. Initial assessments are highly valuable before you embark on participating in Ecosystem collaborations.
There are several emerging frameworks that provide for both universal and distinct application stages. There is always a need to emphasis “contextual nuances” and those “triggering points” but those are further critical aspects to explain for gaining a deeper understanding of Business Ecosystem distinctiveness in future posts.
My aim is to encourage business thinking around Collaborative Ecosystem Management for the future. Considering and then undertaking Business Ecosystems has a very different organizational impact and significant changes to be considered to be built and then put into place.
One exercise I recently undertook was to compare traditional to ecosystem distinctiveness. I offer here ten key distinctive areas for comparison. Let me share these:
There are many aspects to evaluate. Here I provide a handy comparison of existing and necessary changes likely to be made for Ecosystem management. Take a look at many of the principle differences.
I have put these into ease-of-reference set of tables.
Do you recognize the distinct differences between what and how we undertake business and the ecosystem alternatives that can provide such richer options and avenues to future impact and growth.
Value Creation and Flow in approaches and distinctiveness
| Traditional Approaches | Ecosystem Distinctiveness |
| Linear value chains | Multi-directional value flows |
| Predictable supplier-customer relationships | Value multiplication through network effects |
| Value flows mostly in one direction | Dynamic value exchange |
| Clear industry boundaries | Industry boundary blurring |
| Limited to resources & time available | Co-creation opportunities |
Typical Relationship Structures
| Traditional Models | Ecosystem Distinctiveness |
| Fixed, contractual relationships | Flexible, modular partnerships |
| Hierarchical structures | Non-hierarchical networks |
| Limited partner types | Diverse partner types |
| Controlled interactions | Open collaboration |
| Tightly controlled | Self-organizing participants |
Innovation Patterns
| Traditional Models | Ecosystem Distinctiveness |
| Internal R & D driven | Distributed innovation |
| Protected intellectual property | Shared capabilities |
| Controlled product development | Co-creation with partners |
| Scale through ownership and control roll out constrained by one driving force | Scale through orchestrations & Collaboration |
| Controlled experimentation | Rapid multiple experimentation |
Customer Engagement
| Traditional Structures | Ecosystem Distinctiveness |
| Direct customer relationships | Network of customer touch-points |
| Product-centric offerings | Broader Solution-centric offering |
| Fixed value propositions | Evolving and dynamic value proposition |
| Limited customization | Mass customization |
| Lacking consistent dialogues, more static | Integrated experiences real time |
Technology Architecture
| Traditional thinking | Ecosystem distinctiveness |
| Closed systems | Open API’s |
| Proprietary technology | Platform thinking and participation |
| Point-to-point integration | Standardized interfaces |
| Limited data capturing and sharing | Data-sharing frameworks |
| Lacking ability to multiple data sources | Real-time integration |
Competitive Dynamics
| Traditional models | Ecosystem distinctiveness |
| Zero-sum competition | Coopetition driven and exploring |
| Market share focus driven | Market making emphasis- open spaces |
| Industry-specific rivalry | Cross-industry competition |
| Resource ownership advantage | Resource orchestration advantage |
| Market-bound in “known” spaces | Network effects dominance |
Growth Mechanisms
| Traditional Approaches | Ecosystem Distinctiveness |
| Linear Scaling | Exponential scaling potential |
| Assess-based growth | Network-based growth |
| Marker penetration emphasis | Market creation dynamics |
| Vertical integration | Horizontal expansion emphasis |
| Staged to single source capabilities | Platform economics and scale |
Risk & Resilience.
| Traditional Outlooks | Ecosystem Distinctiveness |
| Concentrated risks | Distributed Risks |
| Direct control | Shared Resilience |
| Limited redundancies sought | Build-in redundancy framed |
| Fixed capabilities | Adaptive capabilities, more fluid |
| More constrained tolerances | Dynamic -resource allocation |
Governance Models
| Traditional Thinking | Ecosystem Distinctiveness |
| Hierarchical control | Distributed governance |
| Fixed contracts | Flexible per-discussed agreements |
| Clear boundaries | Permeable boundaries |
| Direct oversight | Orchestration rather than control |
| Structured feedback relating to culture | Self-regulating mechanisms |
Success Metrics
| Traditional approaches | Ecosystem Distinctiveness |
| Individual firm performance | Network health metrics |
| Market share driven | Partner success measures |
| Product margin emphasis | Platform adoption / engagement rates |
| Asset utilization | Network effects measurements |
| Time to returns | Ecosystem value creation |
These comparisons highlight the difference between traditional thinking that is constrained in individual thinking compared to operating in an ecosystem context and illustrate why new operational frameworks are needed, otherwise there is a substantial risk of failures attempting ecosystems with existing thinking and approaches. Here are some building blocks to further consider
I recommend there is an essential need to undertake a detailed examination and assessments of what can constrain any potential in Ecosystem thinking and Design. This enables organization to recognize and then to extract the real benefits out of Ecosystem thinking and Design.
I would suggest “come talk to me” to gain a deeper understanding and different advice and mentoring..