What is true – is that we live in a world of ecosystems. An ecosystem is a series of relationships that work together to create balance. The thing is the theory of business ecosystems and systems thinking implies that you work together in balance to create something of good. If you truly apply systems thinking you need to take into account that the environment is part of your ecosystem.
No business ecosystem on earth is sustainable without two critical factors that live outside of your organisation- the people & the planet. In fact - that is all a business is - a collection of people providing value (services &/ goods) to another group of people who all have one thing in common – the environment they operate in.
The rise of the ecosystems buzzword has led us all to believe that we require a new way of thinking about our businesses — the ecosystems perspective. Whilst it may just be a buzzword that has recently come back into management circles – the heart of ecosystem thinking provides us with an opportunity to become much more relevant through sustainable strategies that in turn drive business resilience.
You can call your current structure a network, system or stakeholder strategy, but if you want to call it an ECOsystem, it involves a profound shift in perspective.
Can you take a step back & think about the system your business or product is a part of & how you are part of the greater system, what your role is within that system and how you are able to influence the system you operate in to create shared value for everyone in the value chain. This new perspective is critical if you want to shift from operating in an EGOsystem to an ECOsystem.
Let’s have a look at the essence of business ecosystems in relation to the origin of the thinking.
At its simplest level an ecosystem is a community or group of living organisms that live and interact with each other and the non-living elements of the environment in which they live. Natural ecosystems are balanced systems that ensure sustainability & survival – cultivating mutual benefit for all. All the members of the system are interconnected, so the loss or change of one factor can have large effects rippling through the entire ecosystem.
One of the key indicators of a healthy business ecosystem is that it should enable companies to evolve together, shifting the focus to co-creation rather than competition. Everyone in the ecosystem should be getting what they need and contributing what they have to create value that can be shared so that benefits are shared across the entire system.
In this definition market success would include benefit for your suppliers, producers, users, employees and everyone else involved in your business. Creating a business ecosystem with the right people or partners is critical to sustainability. These need to be authentic relationships driven by a common purpose or intention.
If we start to look at our competitors as co-creators within our category – what would innovation look like & how would our consumers benefit?
Similarly in the business world, there are a number of ecosystems that can be at play. An ecosystem doesn’t magically appear, it will come as part of a purposeful strategic planning process through a drive to create value across the chain for your customers.
Ecosystem thinking can be of huge value for a small business because it allows you the opportunity to access resources that you may never had had within your own business. Once you think outside of the vacuum of your business – there may be cross pollination opportunities that will form an integral drive for innovation & expansion in your offering.
Business ecosystem thinking & designing for a circular economy go hand in hand. There are incredible opportunities that exist for businesses if we start to look at how we can disrupt the current pattern of consumption from take-make-discard to mimicking the way matter & energy are conserved in a natural ecosystem.
What if you could repurpose, renew or remanufacture your products? How could your waste today become someone else’s innovation material tomorrow? Do people really need to own your products or is there an opportunity for leasing or sharing?
One of the key characteristics of a business ecosystem is that the achievement lies beyond the capabilities of any individual person, organisation, or a group. In a stable environment – ecosystems can provide a competitive edge as they are difficult to replicate. In a disruptive & unstable environment like we are all experiencing now, they can provide resilience. Robust relationships within a business ecosystem can provide the agility that is necessary to pivot & drive the innovation that will help you survive this change.
How to jumpstart ecosystem thinking in your business.
Locate yourself: Understand what value you are truly adding to your consumers & the environment you operate within. If you have not solidified your why – this is the time. Your why is crucial in identifying the businesses you want to align yourself with & how you can shift your business to drive innovation.
Be authentic: Do you really care about your stakeholders? Are you acting on your values?
Zoom out: Stop looking at the details. What does this ecosystem look like from above. Who are we to all of these players.How do we influence this environment? How do people interact or relate to people who are using our services or products? What can we learn about ourselves from outside our walls?
Be curious: Ask yourself what the world really needs – short term & long term. What are the megatrends. Do we have the skills to deliver or create value in line with these megatrends? If not how can we partner to deliver value to our clients? If you are delivering on your why, purpose or mission – any business shift will be credible to your audiences.
To close off in the words of management guru Peter Drucker - “The greatest danger in times of turbulence is not turbulence itself, but to act with yesterday’s logic”.
The time has come to shift our thinking.