Business Ecosystems can unlock game-changing potential
We sometimes get sidetracked, caught up in the “weeds” of making step-by-step progress, seemingly against odds that are often resistant and unyielding to the notion of change or alternatives to what we are doing.
Today many businesses are floundering in low or no-growth environments and applying approaches that just are not equipped to deal with today’s complex challenges. We are facing market conditions caught up in volatility and ongoing disruptions.
We are equally in the age of harnessing collective intelligence to be in a better position to address these complex challenges. The combined power of Gen AI, humans and diversity of understanding need to be harnessed to open up entirely new realms of possibility. Enter the power of Business Ecosystems.
Integrated Blueprint Framework for Business Ecosystem Design and Thinking
So why do we need a Blueprint for thinking through the Business Ecosystem needs of future business? ​
A blueprint is needed to thrive and find solutions in the face of complexity and uncertainty. ​
Ecosystem thinking and design should be central to this blueprint, as it offers the potential for transformative power and new impact, value, and growth. ​
The integration of business ecosystems needs the interconnected parts, with each layer contributing to the whole. ​
The three main layers are Strategic, Operational and Crosscutting in design and building blocks
The need is to move towards a more comprehensive understanding of the values of synergies, interdependencies, and exponential value created when these layers are interconnected.
We need to appreciate the real business ecosystems we need, they are radically different than most of how we presently undertake Business.
What we first need to do is appreciate this significant difference of what are Business Ecosystems BEFORE we jump into chasing different growth, impact or business opportunity. It needs to recognize the most likely outcome is likely to be a new collaborative Business Model and ask “are we ready for that?”
The Yin and Yang of Business- opportunity and risk. Image Adobe
Are we seeing increasing complexity within the business world? The search for growth is having real impact from changing political realities, regulatory and market conditions. We are in a fractured and polarized world at present and we all have to adapt and change how we go about our business. There is more uncertainty and you judge this as either risk or opportunity. There is a strategic imperative to “open up” to alternatives to how you undertake business or accelerate it.
For me risk or opportunity are the same side of the coin, you can’t gain one without a level of the other playing its part. A business “yin and yang”, the opposite but interconnected and often complementary forces to drive our business forward by applying business ecosystem thinking and design opens up new competitive forces to build into your strategic thinking.
Is the level of “fear” seemingly rising and are our business organizations equipped or not, to draw upon the many alternatives that technology, Gen AI, platforms, networks, collaboration and co-creation opportunities that are offered to manage and rethink new opportunity and risk?
Providing the full building blocks of the Ecosystem Business Model
I share this outlined design frame here, clearly to advance Business Ecosystems and provide a framework that enables individuals, groups and (multiple) organizations to begin to organize their conversations into the building blocks to explain and build Ecosystem conversations.
Business ecosystems are complex and often chase down challenges that potentially offer levels of uniqueness and significant improvement on what is existing or known as the existing solutions within the market place but are highly complex in their nature.
In my recent post I provided an initial Ecosystem Business Model frame to introduce and build out a common language and then took that into nine building blocks to get to the point of validating the thinking behind this emerging concept to decide in a further evaluation in a structured way
Providing the full Ecosystem Business Model is the next step
Building the Ecosystem Business model is a paradigm shift
Building Business Ecosystems can be complex to build, let alone explain. I have been working on an evolving Ecosystem Business Model for some time.
So many people are unable to explain Business Ecosystems, especially to others and it holds its evolution back. Let me explain some of my thinking here
I visualized a starting point nearly all should be familiar with, of the Business Model Canvas, by Alexander Osterwalder, drawn from his PhD thesis, supervised by Yves Pigneur (2004), called a business model ontology.
This BMC become a phenomena to enable us to easily describe what building blocks need to be considered for building a business model. As a visual chart it enabled us all to build a picture. It allowed us to describe, design, challenge, invent, explain and eventually recognize where to pivot your business model.
That business model canvas tends to stay rooted (or designed) in the single entity in its intention and as Business Ecosystems involve multiple and diverse stakeholders it helps but, in my opinion, does not reflect the design needed for these Ecosystem models.
In my view “In today’s interconnected world, businesses are increasingly operating within complex ecosystems. Traditional business models often fail to capture the dynamics and interdependence of these ecosystems, leading to missed opportunities of significant competitive advantage and exposure to increased risks that others are recognizing changes and equally on the hunt for new Business Models”
We need to build an Ecosystem Business Model story
Heading towards 2025 on Innovation and Business Ecosystems integration thinking
Where I stand todaythat moves me to the future
Let me provide a really short round up of 2024 from my learning and explaining on innovation ecosystems and specifically integrated business ecosystems. Then I outline some of my plans for 2025 to build out the value of Ecosystems in business.
Ecosystems for business have an absolute need to be integrated, they are heavily interconnected. This post of A New Way to Drive Value Through The Integrated Business Ecosystem Design provides handy visuals depicting the different ecosystems that make up (my) integrated business ecosystem framework.
I have spend time on measuring success, defining the different components, exploring and extending this out. I had a recent post showing some key developments in this thinking with reference posts, moving towards providing a compelling business ecosystem case
I sought out a AI generated view from Google NotebookNL research assistants discussing why Ecosystems are really different to consider, which I found encouraging and good, easy listening.
The work in 2024 will gather even more pace in 2025
Ecosystems in the business environment are taking on a growing importance to manage greater complexity and challenges in unique collaborations than the one single organization cannot handle themselves, so limiting their growth and value potential
We need a different framing of Ecosystems, in appreciating the whole as well as its parts. Often, we describe Ecosystems in far too simplistic terms and fail to recognize the interconnected value we need to bring together from multiple Ecosystems and Networks to extract the value potential that is possible in today’s connected world.
In constructing these Ecosystems I have here provided a short explainer of the Integrated Business Ecosystem Frame and then a summary page of each of its parts with specific definitions and key component parts outlined. These are Ecosystems specifically dealing with innovation, start-up and entrepreneurial, business, dynamism, business, enterprise and enterprise to enterprise (E2E)
Building Effective Business Governance has multiple challenges.
We must emphasise the importance of ecosystem governance, providing a comprehensive structure for designing a practical framework. The robustness and depth of Governance understanding make or break Business Ecosystems. Building a robust governance framework clarifies that managing business ecosystems is not for the faint-hearted or light-of-pocket in all the aspects that need to be considered.
Managing governance is challenging but essential if we recognize that business ecosystems offer immense potential for innovation, rapid scaling, and adaptability. Otherwise, Ecosystems can become expensive and often disruptive ventures. They need to be managed well.
Early research indicates that less than 15% of business ecosystems are sustainable in the long run, with the primary reason for failure lying in the governance model, according to MIT Sloan in How Business Ecosystems Rise and Often Fall, published in 2019.
We have made significant progress in the past few years due to a growing understanding of Governance needs across all parties and the appreciation of the real differences in thinking, designing, and operating in business ecosystems.
The growing recognition of the real power of ecosystems is in the diversity and knowledge sharing today. Also, the recognition that balancing collective interests, mitigating risks, enforcing compliance, and promoting long-term sustainability from kick-off.
The Dynamic Ecosystem within the Interconnected Business Ecosystems
Business Ecosystems are the growing force to galvanize change and build a more collaborative culture, where the partners’ diversity enables solutions to be solving more complex and challenging problems we seem to be facing today.
When thinking about and designing business ecosystems, you must recognize that different ecosystems contribute, evolve, and determine their part in a “bigger” scheme of things. Recognizing that innovation, business, dynamic, and enterprise ecosystems through the design to be interconnected has evolved into the Interconnected Business Ecosystem framework.
Below in this post, I have clarified where the Dynamic Ecosystem fits and its significant contribution, influence, and impact on the health, dynamism, and future solution orientation we strive for in any new solutions. The C-level pitch sums it up well.
I have written extensively about “the dynamics within a system,” especially an innovation one, arguing that adaptation and resilience are consequences of practising “dynamics.” I got caught up in the importance of studying and recommending the need tobuild dynamic capabilities. More recently, I have written about the critically crucial dynamic ecosystem that “sits” in the interconnected business ecosystems of innovation, business, dynamics, and enterprise.
Interdependence and Feedback Loops are pivotal to Interconnected Business Ecosystems
In any interconnected business ecosystem design, two pivotal components work in tandem to ensure the system’s overall health, adaptability, and success. The interdependence and feedback loops are intrinsically linked and mutually reinforcing. This recognition and emphasis on their importance are critical to building a robust business ecosystem.
The combination of interdependence and feedback loops creates a dynamic and self-regulating system. Interdependence highlights the need for coordinated action and shared awareness among ecosystem participants, while feedback loops provide the necessary information and insights to inform that coordinated action.
This post aims to break down the two and combine them in explanations and initial understanding. Examples of measuring them at operational and strategic levels and providing a more comprehensive and systematic approach are not discussed here. That is better at any designing and implementing stage.
