A business ecosystem can be an abstract concept for some, with many different viewpoints on what it really means. However, we can all agree that at its core, there are different entities that connect, collaborate, and compete with each other. Within a business’s productivity ecosystem may be a set of third-party software, such as Microsoft Services, in which the innovation of Microsoft’s own team can impact your own organisation.
The more we understand how different entities affect one another, the more we realise a holistic approach is necessary. Not just third-party software, but different organisations and stakeholders. Designing such an ecosystem is all the more important in a business environment that is highly unpredictable (like we have seen with the pandemic).
The first step is to reflect on if you are really suited to a holistic business ecosystem because there are some limitations and drawbacks. For example, the more modular you are with many different connecting relationships and collaborations, the more coordination can struggle. This is fine in some industries, but it wouldn’t be responsible for something like aerospace. Designing a rocket, for example, takes an extraordinary amount of control and vision – something that cannot be fragmented without increasing the risk and failure of the end product.
Once deciding if an ecosystem is suited to your organisation, it’s then wise to assess the players and roles within it. What is important here is to remember that your core value proposition should remain at the core of these decisions. So, you could see it as the minimum number of relationships are that is required to achieve your core value proposition.
For Elon Musk, the core value proposition of Tesla isn’t just a self-driving car, but it’s one that doesn’t compromise on convenience when it comes to batteries. Elon decided that the current potential collaborators and competitors are yet to produce a battery that could satisfy this core value proposition, and thus taking full control over battery design and innovation became paramount.
However, with Mercedes overtaking Tesla when it comes to range milage, if this lead becomes exponentially larger then Elon’s core value proposition would become compromised, and may have to adapt his ecosystem accordingly.
It’s advised to draw up blueprints of the ecosystem in assessing roles and players, as there will need to be orchestrators at the firm who can design the ecosystem. Having too many relationships and a convoluted ecosystem could become counterproductive, like with the inefficiencies that can arise from having too many integrated software to depend on.
It’s often easier to adopt an existing ecosystem than to develop one yourself for this very reason. For example, Microsoft has an extensive amount of software that internally integrates seamlessly. However, if you are looking to go beyond this, consultancy services are advised in helping define your needs and requirements.
Business management software, such as Odoo, can be a great foundation – but its future integrations and adaptability are important to assess. Having developer access is a prerequisite unless the ecosystem is very simplistic, and of course, the programming languages should somewhat align with the current skill set of the IT personnel.