We are living in a “fast-changing world, a VUCA environment: Volatile, Uncertain, Complex, and Ambiguous. Companies who do not adequately prepare for this pace cannot build sustainable growth. Standing still has an expensive price tag. By identifying trends early, companies can increase their market share in a sustainable way and become more successful in the long term. Today, innovation is a top priority. Companies must therefore understand the dynamics of their market and their business environment. They must be on the cutting edge.
THE FUTURE BELONGS TO ECOSYSTEMS
– COOPERATION IS THE NEW COMPETITION
Today, competitive advantage is not determined by the resources that you manage, but by resources to which you have access. Ecosystems and platforms provide access to networks of technology, talent and information.
The future belongs to ecosystems. Companies, platform providers, government agencies, independent contractors, co-creating customers come together and contribute to achieve a common goal. Each individual organisation creates value for themselves and for the rest of the ecosystem. Each participant benefits from the collective intelligence and the holistic approach of their collective efforts.
Roche Diabetes Care uses DataScouts as a market intelligence platform to analyse and monitor companies around the world providing solutions for everything related to Diabetes. The platform is used to create transparency and increase information sharing across divisions and countries
Through an in-depth understanding of your ecosystem, you get to know your partners better. Ecosystem thinking goes beyond traditional partnership and beyond your own industry. Interconnection with the rest of the world becomes not only a nice-to-have but a necessity to survive and to thrive. Every organization exists in multiple business ecosystems.
This requires companies to create business strategies that capitalize on relationships to create maximum value in the market. A strategy to survive this faster environment is collaboration. The road to success brings you to the center of the network.
ING uses the banking of things umbrella initiative to connect and cross-pollinate value on a bigger scale, for example enabling easier payments at petrol stations by partnering with car manufacturer BMW.
Moreover, the shared knowledge forms an excellent barometer not only for the speed of technological changes but also the acceptance by consumers.
Apple, Fitbit and Garmin created an ecosystem focused on fitness and apps.
YOUR ROLE AS INNOVATION MANAGER
“It is hard to keep on top of industry trends and changes. It is even harder to transform market trends and innovations in the business ecosystem into specific actions to drive a company’s growth.”
As a company one sees the external changes that ecosystem thinking entails: opportunities and responsibilities have changed thanks to direct interactions with consumers. Internally, the company is being radically restructured into hundreds of entrepreneurial cells, all fueled by a common infrastructure platform.
ING uses DataScouts as an extension of their internal CRM system. DataScouts provides and an ad-hoc segmentation predicting growth based upon a wide range of data points and digital metrics.
As an innovation manager you get to process this internal information, from data, news articles and input from others. You want to be aware of what is happening in your business environment and identify trends on an early phase. Employees at all levels in your organization and in all steps of the customer’s value chain come across relevant information. It is not easy to transform this individual information into a common understanding and a joint action plan.
CIOs and IT leaders must shift and expand their mindset and approach to focus on their organization’s strategy and execution within their business ecosystems from an outside-in perspective. The challenge is deciding how your organization will survive and thrive in its ecosystem. Decide what role your organization will play in these ecosystems: leader, disruptor, niche player, orchestrator, or something else.
You are responsible for the technology that will enable the business ecosystem strategy now and in the future. Success will require a strategic integration of technology, information and business processes. If you don’t understand your business ecosystem, you risk to fall in a participatory role. Instead of just participating and enabling your partners or competitors to take a leadership role, you can define the rules for engagement in that ecosystem and take the leadership role yourself.
STRATEGY AND TACTICS
Before you take strategic decisions about how to participate or change tactics, consider the following elements.
The degree of openness within ecosystems is driven by strategies, shared interest and common goals. The openness of an ecosystem has two implications. The degree of change is dependent upon the possibility of new entrants and disruption to relationships and value. Secondly it will also define the nature of the relationships in the ecosystems, on how those relationships are formed and maintained. At last the degree of openness will define the nature of collaboration and competitions.
As an innovation manager, you need to know the diversity of the ecosystem and the engagement of the diverse participants. The roles of participants evolve depending on the situation, which has an influence on how solutions are defined and supported.
When BMW and Toyota need to develop key technologies, such as batteries, they may join together and then later go on to compete in the marketplace.
It’s important to understand the changing definition of “value” that ecosystems create. In addition to monetary-based value exchange ecosystems enable companies to exchange products and services for information or analytics.
Probably your organization will be involved in multiple ecosystems. The key is to understand how these ecosystems interact. Are there potential fractures or overlaps? Overlapping ecosystems can create a new ecosystem or will highlight redundancy.
STEPS TO TAKE
Build situational awareness by mapping and analysing your business ecosystem
For a holistic and future-oriented image, the analysis must combine statistics such as profitability and growth with more qualitative indicators such as competition intensity, economic interdependence and sustainability.
- Conduct research inside and outside your industry to explore for signals of disruption and opportunities for growth.
- Build an overview of key market trends and drivers for change.
- Map the innovation ecosphere for your industry, i.e. competitors, startups, partners, incubators & accelerators.
Take a leadership role in your business ecosystem:
- Reach out to collaborate with business counterparts on how and why to integrate ecosystems to improve the overall corporate strategy.
- Create value for the ecosystem on long term: ensure any customer-, partner-, employee- or supplier-focused applications or solutions being developed today are at least considering these future business ecosystems.
Take a leadership innovator role in your company: Make sure to set aside development budget every year for the next five years for applications, solutions and supporting infrastructure to enable change to reflect evolving ecosystem strategies. By automating the scouting and cracking of data, more time is left for the analysis and translation of the insights into concrete action.
- Automate the data collection process by systematically collecting structured and unstructured data about relevant companies, market trends and emerging technologies.
- Systematically monitor the actors that are relevant to your business, clustered into portfolios and scores against KPIs that matter to your business.
- Build ad-hoc analysis and visualization on one common database, the one version of the truth representing all relevant actors in your ecosystem.
- Implement a collaborative work flow to build an accurate overview of an innovation ecosystem. Invite team members to add personal notes and to complete individual score card per company.
About We Connect Data
We Connect Data helps organisations navigate today’s fast changing and thus less predictable business environment. Access to (f)actual information leads to smarter business decisions. We therefore encourage organisations to systematically collect data, to establish data-driven business processes and to embrace collaborative platforms.